Cabinet
Affairs |
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2 T H E C A B I N E T
3 S T A T E O F F L O R I D A
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Representing:
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STATE BOARD OF ADMINISTRATION
6 DEPARTMENT OF HIGHWAY SAFETY
AND MOTOR VEHICLES
7 STATE BOARD OF EDUCATION
ADMINISTRATION COMMISSION
8 BOARD OF TRUSTEES OF THE INTERNAL
IMPROVEMENT TRUST FUND
9 DEPARTMENT OF ENVIRONMENTAL PROTECTION
10
The above agencies came to be heard before
11 THE FLORIDA CABINET, Honorable Governor Chiles
presiding, in the Cabinet Meeting Room, LL-03,
12 The Capitol, Tallahassee, Florida, on Tuesday,
April 23, 1996, commencing at approximately
13 11:15 a.m.
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17 Reported by:
18 LAURIE L. GILBERT
Registered Professional Reporter
19 Certified Court Reporter
Notary Public in and for
20 the State of Florida at Large
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23 ACCURATE STENOTYPE REPORTERS, INC.
100 SALEM COURT
24 TALLAHASSEE, FLORIDA 32301
904/878-2221
25 1-800/934-9090
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1 APPEARANCES:
2 Representing the Florida Cabinet:
3 LAWTON CHILES
Governor
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BOB CRAWFORD
5 Commissioner of Agriculture
6 BOB MILLIGAN
Comptroller
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SANDRA B. MORTHAM
8 Secretary of State
9 BOB BUTTERWORTH
Attorney General
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BILL NELSON
11 Treasurer
12 FRANK T. BROGAN
Commissioner of Education
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ACCURATE STENOTYPE REPORTERS, INC.
April 23, 1996
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1 I N D E X
2 ITEM ACTION PAGE
3 STATE BOARD OF ADMINISTRATION:
(Presented by John W. (Jack) Madden,
4 Chief Administrative Officer)
5 1 Approved 5
2 Approved 5
6 3 Approved 6
4 Approved 6
7 5 Approved 6
8 DEPARTMENT OF HIGHWAY SAFETY AND MOTOR VEHICLES:
(Presented by Fred O. Dickinson, III,
9 Executive Director)
10 1 Approved 7
2 Approved 7
11 3 Approved 8
12 STATE BOARD OF EDUCATION:
(Presented by Robert L. Bedford, Ph.D.,
13 Deputy Commissioner)
14 1 Approved 9
2 Approved 9
15 3 Approved 10
4 Approved 10
16 5 Approved 11
6 Approved 11
17 7 Approved 11
8 Approved 11
18 9 Approved 12
19 ADMINISTRATION COMMISSION:
(Presented by Gale Sittig,
20 Deputy Director)
21 1 Approved 13
2 Approved 13
22 3 Approved 14
4 Approved 14
23 5 Approved 14
6 Approved 14
24 7 Approved 15
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ACCURATE STENOTYPE REPORTERS, INC.
April 23, 1996
4
1 I N D E X
(Continued)
2
ITEM ACTION PAGE
3
BOARD OF TRUSTEES,
4 INTERNAL IMPROVEMENT
TRUST FUND:
5 (Presented by Kirby B. Green, III,
Deputy Secretary)
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1 Approved 16
7 2 Approved 16
3 Withdrawn 16
8 4 Approved 16
5 Approved 17
9 6 Approved 17
7 Approved 17
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DEPARTMENT OF ENVIRONMENTAL PROTECTION:
11 (Presented by Kirby B. Green, III,
Deputy Secretary)
12
1 Approved 18
13 2 Denied 250
14 CERTIFICATE OF REPORTER 251
15 *
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ACCURATE STENOTYPE REPORTERS, INC.
STATE BOARD OF ADMINISTRATION
April 23, 1996
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1 P R O C E E D I N G S
2 (The agenda items commenced at 11:55 a.m.)
3 GOVERNOR CHILES: And we'll go to our
4 agenda now with the State Board of
5 Administration.
6 MR. MADDEN: Good morning, Governor. I'm
7 Jack Madden --
8 GOVERNOR CHILES: Good morning.
9 MR. MADDEN: -- I'll be handling the agenda
10 for Mr. Williams in his absence.
11 Item 1 is the approval of the minutes.
12 GOVERNOR CHILES: Is there a motion?
13 COMPTROLLER MILLIGAN: Move it.
14 TREASURER NELSON: Motion.
15 GOVERNOR CHILES: Moved and seconded.
16 Without objection, the minutes are
17 approved.
18 MR. MADDEN: Item 2 is an interest rate
19 exception for the Village Center Community
20 Development District.
21 TREASURER NELSON: Move it.
22 COMPTROLLER MILLIGAN: And second.
23 GOVERNOR CHILES: Moved and seconded.
24 Without objection, the item is approved.
25 MR. MADDEN: Item 3 is an interest rate
ACCURATE STENOTYPE REPORTERS, INC.
STATE BOARD OF ADMINISTRATION
April 23, 1996
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1 exception for the Housing Finance Authority of
2 Broward County.
3 TREASURER NELSON: I move it.
4 COMPTROLLER MILLIGAN: And I second.
5 GOVERNOR CHILES: Moved and seconded.
6 Without objection, it's approved.
7 MR. MADDEN: Item 4 is the adoption of
8 revisions to Rule 19, dash, 18.010; and the
9 adoption of new rule 19-8.011 for the Florida
10 Hurricane Catastrophe Fund.
11 TREASURER NELSON: And I move it.
12 COMPTROLLER MILLIGAN: And I second.
13 GOVERNOR CHILES: Moved and seconded.
14 Without objection, that's approved.
15 MR. MADDEN: Item 5 is the report of the
16 Executive Director.
17 TREASURER NELSON: Move it.
18 COMPTROLLER MILLIGAN: Second.
19 GOVERNOR CHILES: Moved and seconded.
20 Without objection, Item 5 is approved.
21 MR. MADDEN: That concludes the agenda,
22 Governor.
23 GOVERNOR CHILES: Thank you, sir.
24 (The State Board of Administration Agenda
25 was concluded.)
ACCURATE STENOTYPE REPORTERS, INC.
DEPARTMENT OF HIGHWAY SAFETY/MOTOR VEHICLES
April 23, 1996
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1 GOVERNOR CHILES:
2 Department of Highway Safety and Motor Vehicles.
3 MR. DICKINSON: Governor, Item 1 is
4 approval of minutes from the March 12th Cabinet
5 meeting.
6 SECRETARY MORTHAM: Move approval.
7 COMMISSIONER BROGAN: So move.
8 GOVERNOR CHILES: Moved and seconded.
9 Without objection, they're approved.
10 MR. DICKINSON: Second item is a request
11 for authority to enter into a contract with a
12 "Uniface" software development company for
13 training and software.
14 This is part of our ongoing quality program
15 out at the Department.
16 COMMISSIONER CRAWFORD: Motion.
17 GOVERNOR CHILES: There's a motion on that.
18 COMPTROLLER MILLIGAN: Second.
19 GOVERNOR CHILES: And a second.
20 Without objection, that's approved.
21 MR. DICKINSON: Item number 3 is a request
22 to contract with Florida State University for
23 the design, development, and installation of a
24 centralized database to track our DUI clients.
25 This is a grant that we secured through
ACCURATE STENOTYPE REPORTERS, INC.
DEPARTMENT OF HIGHWAY SAFETY/MOTOR VEHICLES
April 23, 1996
8
1 the Department of Transportation.
2 COMMISSIONER CRAWFORD: Motion.
3 GOVERNOR CHILES: Motion.
4 COMPTROLLER MILLIGAN: Second.
5 COMMISSIONER BROGAN: Second.
6 GOVERNOR CHILES: Second.
7 Without objection, that's approved.
8 MR. DICKINSON: That concludes our agenda.
9 GOVERNOR CHILES: Thank you, sir.
10 (The Department of Highway Safety and Motor
11 Vehicles Agenda was concluded.)
12 *
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ACCURATE STENOTYPE REPORTERS, INC.
STATE BOARD OF EDUCATION
April 23, 1996
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1 GOVERNOR CHILES: State Board of Education.
2 DR. BEDFORD: Good morning,
3 Governor Chiles, members of the State Board of
4 Education.
5 Item 1, request for approval of a contract
6 with addendum to enter into services with
7 Educational Clearinghouse.
8 COMMISSIONER BROGAN: Move approval.
9 COMMISSIONER CRAWFORD: Second.
10 GOVERNOR CHILES: Moved and seconded.
11 Without objection, that's approved.
12 DR. BEDFORD: Item 2, Rule 6A, dash,
13 1.09412, amendment to the Course Curriculum
14 Frameworks, Grades 6 through 12, Basic and Adult
15 Secondary Programs.
16 COMMISSIONER BROGAN: Move approval.
17 SECRETARY MORTHAM: Second.
18 GOVERNOR CHILES: Moved and seconded.
19 Without objection, it's approved.
20 DR. BEDFORD: Items 3 through 8 I will take
21 separately. But I would like to take a moment
22 to commend the State University System for the
23 screening they have done in the chapters.
24 They've completed all 21 chapters of their
25 rules. When we conclude today, we will have
ACCURATE STENOTYPE REPORTERS, INC.
STATE BOARD OF EDUCATION
April 23, 1996
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1 presented them to you.
2 They have repealed one-third of their
3 rules, they have amended one-third of their
4 rules, and one-third of their rules were
5 statutory requirements, and are, therefore, on
6 the books.
7 And I really appreciate the work they've
8 done.
9 Item 3, 6C, dash, 9.001, repeal.
10 COMMISSIONER BROGAN: Move it.
11 COMMISSIONER CRAWFORD: Second.
12 GOVERNOR CHILES: Moved and seconded.
13 Without objection, that's approved.
14 DR. BEDFORD: Item 4, Chapter 6C, dash, 14,
15 repeals and revisions to administration of
16 construction program.
17 COMMISSIONER BROGAN: Move approval.
18 COMMISSIONER CRAWFORD: Second.
19 GOVERNOR CHILES: Moved and seconded.
20 Without objection, that's approved.
21 DR. BEDFORD: Item 5, Chapter 6C, dash, 15,
22 repeals administration of surplus property.
23 (Attorney General Butterworth exited the
24 room.)
25 COMMISSIONER BROGAN: Move approval.
ACCURATE STENOTYPE REPORTERS, INC.
STATE BOARD OF EDUCATION
April 23, 1996
11
1 COMMISSIONER CRAWFORD: Second.
2 GOVERNOR CHILES: Moved and seconded.
3 Without objection, that's approved.
4 DR. BEDFORD: Item 6, Chapter 6C, dash, 16,
5 repeals administration of motor pool.
6 COMMISSIONER BROGAN: Move it.
7 COMMISSIONER CRAWFORD: Second.
8 GOVERNOR CHILES: Moved and seconded.
9 Without objection, that's approved.
10 DR. BEDFORD: Item 7, Chapter 6C, dash, 17,
11 repeals and revisions to the administration of
12 leasing program.
13 COMMISSIONER BROGAN: Move approval.
14 SECRETARY MORTHAM: Second.
15 GOVERNOR CHILES: Moved and seconded.
16 Without objection, that's approved.
17 DR. BEDFORD: Item 8, Chapter 6C, dash, 18,
18 repeals and revision to administration of
19 purchasing program.
20 COMMISSIONER BROGAN: Move approval.
21 SECRETARY MORTHAM: Second.
22 GOVERNOR CHILES: There's a motion and
23 second.
24 Item 8 is approved.
25 DR. BEDFORD: Item 9, request by the
ACCURATE STENOTYPE REPORTERS, INC.
STATE BOARD OF EDUCATION
April 23, 1996
12
1 Florida Board of Regents on behalf of the
2 Florida Solar Energy Center for final release of
3 the United States property previously occupied
4 by the Florida Solar Energy Center.
5 COMMISSIONER BROGAN: Move approval.
6 SECRETARY MORTHAM: Second.
7 GOVERNOR CHILES: Moved and seconded.
8 Without objection, that is approved.
9 DR. BEDFORD: That concludes the agenda.
10 GOVERNOR CHILES: Thank you, sir.
11 (The State Board of Education Agenda was
12 concluded.)
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ACCURATE STENOTYPE REPORTERS, INC.
ADMINISTRATION COMMISSION
April 23, 1996
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1 GOVERNOR CHILES: The
2 Administrative Commission --
3 Administration Commission.
4 MS. SITTIG: Item 1, recommend approval of
5 the minutes of the meeting held March 28th,
6 1996.
7 COMMISSIONER BROGAN: Move approval.
8 SECRETARY MORTHAM: Move approval.
9 GOVERNOR CHILES: Moved and seconded.
10 Without objection, they're approved.
11 MS. SITTIG: Item 2, recommend the transfer
12 of general revenue appropriations to the Agency
13 for Health Care Administration.
14 (Attorney General Butterworth entered the
15 room.)
16 SECRETARY MORTHAM: Move approval.
17 COMMISSIONER BROGAN: Second.
18 GOVERNOR CHILES: Moved and seconded.
19 Without objection, that's approved.
20 MS. SITTIG: Item 3, recommend the transfer
21 of general revenue appropriations in the
22 Department of Education.
23 SECRETARY MORTHAM: Move approval.
24 COMMISSIONER BROGAN: Second.
25 GOVERNOR CHILES: Moved and seconded.
ACCURATE STENOTYPE REPORTERS, INC.
ADMINISTRATION COMMISSION
April 23, 1996
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1 Without objection, that's approved.
2 MS. SITTIG: Item 4, recommend the transfer
3 of general revenue appropriations in the Justice
4 Administration Commission.
5 SECRETARY MORTHAM: Move approval.
6 COMMISSIONER BROGAN: Second.
7 GOVERNOR CHILES: Motion and second.
8 Without objection, Item 4 is approved.
9 MS. SITTIG: Item 5, recommend the transfer
10 of general revenue appropriations in the
11 Department of Juvenile Justice.
12 SECRETARY MORTHAM: Move approval.
13 COMMISSIONER BROGAN: Second.
14 GOVERNOR CHILES: Moved and seconded.
15 Without objection, Item 5 is approved.
16 MS. SITTIG: Item 6, recommend the transfer
17 of general revenue appropriations in the
18 Department of Management Services.
19 SECRETARY MORTHAM: Move approval.
20 COMMISSIONER BROGAN: Second.
21 GOVERNOR CHILES: Moved and seconded.
22 Without objection, that's approved.
23 MS. SITTIG: And lastly, Item 7, recommend
24 the transfer of the general revenue
25 appropriations in the Department of State.
ACCURATE STENOTYPE REPORTERS, INC.
ADMINISTRATION COMMISSION
April 23, 1996
15
1 COMMISSIONER BROGAN: Move approval.
2 SECRETARY MORTHAM: Second.
3 COMPTROLLER MILLIGAN: Second.
4 GOVERNOR CHILES: Moved and seconded.
5 Without objection, that's approved.
6 MS. SITTIG: Thank you.
7 (The Administration Commission Agenda was
8 concluded.)
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ACCURATE STENOTYPE REPORTERS, INC.
TRUSTEES/INTERNAL IMPROVEMENT TRUST FUND
April 23, 1996
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1 GOVERNOR CHILES: Trustees of Internal
2 Improvement Fund.
3 MR. GREEN: Item 1, approval of March 12th
4 minutes.
5 COMMISSIONER BROGAN: Move it.
6 SECRETARY MORTHAM: Second.
7 GOVERNOR CHILES: Moved and seconded.
8 Without objection, they're approved.
9 MR. GREEN: Item 2, request by the
10 Department of Agriculture to sell a parcel of
11 real property, and request by the Department to
12 convey that parcel.
13 COMMISSIONER BROGAN: Move approval.
14 SECRETARY MORTHAM: Move approval.
15 COMMISSIONER CRAWFORD: Second.
16 GOVERNOR CHILES: Moved and seconded.
17 Without objection, that's approved.
18 MR. GREEN: Withdraw Item 3, request
19 withdrawal.
20 GOVERNOR CHILES: Item 3 is withdrawn.
21 MR. GREEN: Item 4, an option agreement.
22 SECRETARY MORTHAM: Move approval.
23 COMMISSIONER BROGAN: Second.
24 GOVERNOR CHILES: Moved and seconded.
25 Without objection, that's approved.
ACCURATE STENOTYPE REPORTERS, INC.
TRUSTEES/INTERNAL IMPROVEMENT TRUST FUND
April 23, 1996
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1 MR. GREEN: Item 5, an option agreement.
2 SECRETARY MORTHAM: Move approval.
3 COMMISSIONER BROGAN: Second.
4 GOVERNOR CHILES: Without objection, Item 5
5 is approved.
6 Moved and seconded.
7 MR. GREEN: Item 6, two purchase
8 agreements.
9 SECRETARY MORTHAM: Move approval.
10 COMMISSIONER BROGAN: Second.
11 GOVERNOR CHILES: Motion and seconded.
12 Without objection, Item 6 is approved.
13 MR. GREEN: Item 7, three purchase
14 agreements.
15 SECRETARY MORTHAM: Move approval.
16 COMMISSIONER BROGAN: Move approval.
17 ATTORNEY GENERAL BUTTERWORTH: Second.
18 GOVERNOR CHILES: Moved and seconded.
19 Without objection, Item 7.
20 (The Board of Trustees of the Internal
21 Improvement Trust Fund Agenda was concluded.)
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ACCURATE STENOTYPE REPORTERS, INC.
DEPARTMENT OF ENVIRONMENTAL PROTECTION
April 23, 1996
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1 GOVERNOR CHILES:
2 Department of Environmental Protection.
3 MR. GREEN: Item 1, approval of minutes.
4 SECRETARY MORTHAM: So move.
5 ATTORNEY GENERAL BUTTERWORTH: Second.
6 GOVERNOR CHILES: Moved and seconded.
7 Without objection, they're approved.
8 MR. GREEN: Item 2, consideration of a
9 final order recommending that the Siting Board
10 grant certification to the Florida Power & Light
11 Company.
12 This item comes before you as your role as
13 the Power Plant Siting Board as required by
14 Part II of Chapter 403 of the Florida Statutes.
15 FP&L began this process of changing the
16 fuel at Manatee Power Plant to burn orimulsion
17 in 1990 with a request to conduct experimental
18 burns of orimulsion at the Sanford Power plant.
19 The purpose of that experiment was to allow
20 FP&L and DEP to determine the actual results of
21 burning orimulsion.
22 Almost four years later, in May of '94,
23 FP&L requested and held a pre-application
24 meeting with the Department to advise the Agency
25 of their plan to request the fuel change to
ACCURATE STENOTYPE REPORTERS, INC.
DEPARTMENT OF ENVIRONMENTAL PROTECTION
April 23, 1996
19
1 allow them to burn orimulsion at the Manatee
2 plant.
3 FP&L then took their request to the
4 Public Service Commission. The
5 Public Service Commission, it's role in this
6 issue, was to ensure that the fuel would be
7 readily available and consistently applied. And
8 to determine the impact of the fuel change on
9 rates.
10 In this case, the amount of savings to rate
11 payors that would result from the conversion to
12 orimulsion.
13 In September of '94, FP&L filed a formal
14 application with DEP, as staff to the
15 Siting Board, for approval to burn orimulsion at
16 the Manatee plant.
17 In October of '94, the application was
18 considered complete, and was sent to all
19 required parties for review. The siting law
20 directs that it is the collective responsibility
21 of the impacted state and local agencies to
22 review the application, not just DEP.
23 In this case, those agencies included the
24 Public Service Commission, the Department of
25 Community Affairs, the Game and Fresh Water Fish
ACCURATE STENOTYPE REPORTERS, INC.
DEPARTMENT OF ENVIRONMENTAL PROTECTION
April 23, 1996
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1 Commission, South Florida Water Management
2 District, the Tampa Bay Regional Planning
3 Council --
4 (Attorney General Butterworth exited the
5 room.)
6 MR. GREEN: -- Manatee County, the Division
7 of Forestry, the Department of Transportation,
8 HRS, and the Department of State.
9 The application was also sent to local
10 government jurisdictions in the immediate
11 vicinity of the plant. Those were
12 Hillsborough County and Pinellas County.
13 Review was also requested by federal
14 agencies such as United States Coast Guard.
15 EPA also reviewed the application as part
16 of the United States Corps of Engineer permit
17 review process, and the prevention of
18 significant deterioration permit.
19 You have a copy of the EPA letter
20 indicating compliance with their requirements
21 and their guidelines in your backup.
22 In total, 15 governmental agencies reviewed
23 the application, 63 of DEP's professional staff
24 reviewed the scientific and technical areas of
25 the application.
ACCURATE STENOTYPE REPORTERS, INC.
DEPARTMENT OF ENVIRONMENTAL PROTECTION
April 23, 1996
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1 This review consisted of a series of
2 questions asked by -- asked of FP&L by the
3 agencies for clarification of the application
4 and the impacts of burning orimulsion. This
5 portion of the review was completed in May of
6 '95 with the application being deemed -- deemed
7 sufficient for final review.
8 From the information gathered, this -- in
9 this review process, the Agency developed final
10 comments and recommendations on the
11 application. The final review occurred from
12 July to September of '95.
13 The comments received from the -- from the
14 agencies created the basis on which the FPL
15 application would go on to the hearing officer
16 as step precedent to it coming to you for your
17 review today.
18 As part of the process --
19 (Attorney General Butterworth entered the
20 room.)
21 MR. GREEN: -- it's DEP's responsibility to
22 work with the affected agencies and local
23 governments to develop objections and concerns
24 that must be addressed by FP&L through
25 modification of their application resolving --
ACCURATE STENOTYPE REPORTERS, INC.
DEPARTMENT OF ENVIRONMENTAL PROTECTION
April 23, 1996
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1 to resolve those objections and concerns.
2 This process continued --
3 (Secretary Mortham exited the room.)
4 MR. GREEN: -- up through, and in some
5 cases, during the beginning of the formal DOAH
6 hearing.
7 The formal hearing was conducted in
8 Manatee County from November 28th through
9 December 13th of '95.
10 In February of '96, the hearing officer
11 issued his recommended order, which is before
12 you today.
13 The recommended order present -- represents
14 your staff's best professional judgment on those
15 issues that were before them. We have
16 recommended conditions that would reduce the
17 annual emissions of S2O, NOx, and particulate
18 matter below those levels currently set in the
19 plant's operating permit.
20 In addition, we have imposed transportation
21 standards on ships bringing orimulsion to port
22 to ensure the safe delivery of the fuel with the
23 minimum probability of spill.
24 This -- this completes the technical phase
25 of the review of the process, and begins the
ACCURATE STENOTYPE REPORTERS, INC.
DEPARTMENT OF ENVIRONMENTAL PROTECTION
April 23, 1996
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1 public policy phase of the process.
2 The application is technically acceptable.
3 If the Siting Board believes that it is good
4 public policy to allow FPL to burn orimulsion,
5 it can -- it can permit it under the conditions
6 set out in the final order.
7 All of the local, state, and federal
8 agencies involved in the process have resolved
9 their technical concerns with the conditions
10 attached to the application.
11 However, this is a new fuel. And there are
12 many groups and individuals who do not believe
13 it's in the public interest to burn the fuel at
14 Manatee plant. Many of them will address you
15 today on that policy issue.
16 Before they begin --
17 (Secretary Mortham entered the room.)
18 MR. GREEN: -- we wish to set the stage for
19 your deliberations by briefly going over the
20 technical issues that were involved in the
21 application.
22 Buck Oven of the Department staff will
23 summarize for you the technical and scientific
24 results of that investigation. Herb Rhodes will
25 summarize the air quality issues involved in
ACCURATE STENOTYPE REPORTERS, INC.
DEPARTMENT OF ENVIRONMENTAL PROTECTION
April 23, 1996
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1 the -- in the fuel. And Mimi Drew will be here
2 for questions on water quality if you have them.
3 Buck.
4 MR. COLLETTO: My education did not prepare
5 me for this. So I don't know how that lowers.
6 MR. GREEN: Just do it without.
7 MR. COLLETTO: Do it without. All right.
8 MR. OVEN: Okay.
9 MR. COLLETTO: Sorry.
10 MR. OVEN: Governor, members of the
11 Siting Board, my name is Buck Oven. I'm
12 Administrator of the Siting Coordination Office
13 for the Department of Environmental Protection.
14 I have been working with the Power Plant
15 Siting Program of the State Environmental Agency
16 since 1973.
17 This particular project is coming to you
18 under a special section of the Power Plant
19 Siting Act. This project has received the most
20 detailed scrutiny of any application to date.
21 We've had more people from our technical staff
22 looking at it, we've had more people from the
23 technical staff of other agencies looking at
24 it.
25 When this project first arrived in
ACCURATE STENOTYPE REPORTERS, INC.
DEPARTMENT OF ENVIRONMENTAL PROTECTION
April 23, 1996
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1 September of 1994, there were a number of
2 provisions of it that we did not like. As it
3 first came to us, we would not have recommended
4 approval.
5 But going through the process of questions
6 and answering and questioning and challenging
7 Florida Power & Light, we came up with a better
8 way of doing things.
9 We have looked at the overall impacts that
10 would occur of this new revised plant versus the
11 currently operating plant. And we see that
12 there are environmental advantages, and other
13 advantages to utilizing a revised plant with
14 this fuel orimulsion.
15 Now, 403.5175 addresses the certification
16 of an existing power plant. That's the
17 power plant that was existing on the day that
18 the Power Plant Siting Act took effect.
19 It's a recent addition to the Act. It
20 allows us to do a comprehensive, almost like an
21 ecosystem analysis, of a revision to an existing
22 power plant.
23 The statute lays out four basic criteria
24 that you all are supposed to consider. We, and
25 the hearing officer, have looked at these
ACCURATE STENOTYPE REPORTERS, INC.
DEPARTMENT OF ENVIRONMENTAL PROTECTION
April 23, 1996
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1 things, and the hearing officer has found, and
2 we agree, that if this project is approved, with
3 the Conditions of Certification that are
4 included, it will comply with the nonprocedural
5 requirements of agencies such as DEP, Southwest
6 Florida Water Management District, Game and
7 Fresh Water Fish Commission, Department of
8 Community Affairs, Tampa Bay Regional Planning
9 Council, and Manatee County.
10 Manatee County found that if you adopt
11 their Conditions of Certification, which also
12 includes the granting of variances to two
13 ordinances concerning both landscaping and
14 wetlands, it would comply with their basic
15 policies.
16 Second thing, result in environmental or
17 other benefits compared the current utilization
18 of the site. The hearing officer and DEP staff
19 find that there will be a reduction in overall
20 emissions of air pollutants; a reduction in
21 health risks from air pollutants; a reduction in
22 allowable withdrawals from Little Manatee River;
23 enhancement and preservation of wetland areas;
24 reduction in risk of fuel spills; potential
25 savings to rate payors, anywhere from
ACCURATE STENOTYPE REPORTERS, INC.
DEPARTMENT OF ENVIRONMENTAL PROTECTION
April 23, 1996
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1 655 million to up to 6 billion over 20 years; an
2 increase in governmental revenues that could
3 benefit the economy.
4 There are procedures here which would help
5 maintain and protect the ecosystem of the Little
6 Manatee River. There are, of course, new
7 construction jobs. There's going to be increase
8 in sales taxes.
9 The third area to be looked at is efforts
10 to minimize adverse impacts. We have the
11 installation of --
12 (Treasurer Nelson exited the room.)
13 MR. OVEN: -- new technology on air
14 pollution. This existing power plant has almost
15 no air pollution control equipment on it. It
16 operates by using low sulfur fuel oil, and some
17 good combustion practices.
18 The installation of electrostatic
19 precipitators, scrubbers, low NOx burners, and a
20 reburn technology are a help to reduce air
21 emissions.
22 This design of this project now allows for
23 zero discharge of wastewater from the facility.
24 Not even the gate tests are to be discharged.
25 They're going to cap or reduce the current
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1 withdrawal levels to Little Manatee River,
2 regulating the withdrawals based on river flow,
3 setting a minimal level when they can't withdraw
4 level.
5 We see that the water uses are being
6 prioritized by use of lowest quality of water
7 first.
8 There'll be a sale of by-products from the
9 air pollution control system. This removes
10 solid waste that might be a source of
11 groundwater pollution to the environment.
12 And there is increased shipping, unloading,
13 and spill control measures to be applied to this
14 particular fuel. And the use of that technology
15 and management systems is going to reduce the
16 risk of a spill in Tampa Bay over existing
17 conditions.
18 All of these things lead to the last issue,
19 which is your unique province, that of the
20 public interest.
21 There will be a lower cost of electricity.
22 There'll be increased fuel diversity, increase
23 in jobs, increase in ad valorem tax base,
24 reduction in air pollutant locally and
25 statewide, and protection of biodiversity of the
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1 Little Manatee River.
2 This is a quick nutshell of the findings of
3 the hearing officer and the findings of the
4 Department staff and the recommendations of all
5 the agencies that were involved in this
6 particular process.
7 Although they were not directly a part of
8 the power plant siting process, both
9 Hillsborough County and Pinellas County got
10 involved in air pollution aspects of this
11 facility. And through their efforts, we were
12 able to get FPL to do a better job of air
13 pollution control.
14 That leads us to our next speaker, which is
15 Howard Rhodes, the Director of Division of Air
16 Resources Management. Myself and other members
17 of the DEP staff are available here to answer
18 any questions you may have.
19 Mr. Rhodes.
20 MR. RHODES: Good morning, Governor,
21 members of the Siting Board. My name is
22 Howard Rhodes. I'm the Director of Air Resource
23 Management Division within DEP.
24 Today I plan on presenting three overhead
25 charts, and I'm glad to see this down.
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1 The first is a depiction -- as soon as it
2 comes on. There we go.
3 Focus.
4 There we go.
5 As we get this overhead adjusted, what --
6 what it is is a depiction of the hourly
7 emissions from the Manatee Power Plant. It
8 compares three different parameters for air
9 pollution: SO2, NOx, and PM, for oil permitted,
10 oil actual, and orimulsion permitted.
11 Now, the terms SO2, NOx, and PM are
12 chemical terms relating to sulfur dioxide,
13 nitrogen oxide, and particulate matter. These
14 are the primary pollutants we look at from
15 power plants.
16 As you can see for the first item for SO2,
17 the permitted amount for orimulsion is about
18 seventy-- is 19 percent of that for oil.
19 The next item over is NOx. It's roughly
20 71 percent of that for oil.
21 And the PM is 22 percent of that for
22 corresponding oil.
23 The second chart that I have is in --
24 annual emissions as opposed to the actual hourly
25 emissions of the previous chart.
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1 This second chart is for the Manatee
2 Power Plant for oil and orimulsion also. For
3 the permitted SO2, orimulsion emissions are
4 51 percent of that for oil on an annualized
5 business.
6 For NOx, it's 180 percent of that for oil;
7 and for PM, it's approximately the same.
8 The third chart that I'll show you is a
9 comparison of this plant with one of the best
10 coal powered plants in the country, which
11 happens to be in Orlando called the Stanton
12 plant. And also a natural gas plant.
13 This is the coal plant right here. Oil,
14 orimulsion, and the one on the far right is the
15 numbers for natural gas.
16 As you can see, the coal powered plant and
17 the orimulsion are about the same. Oil is much
18 higher on an annualized basis, and natural gas
19 is much better for SO2.
20 For NOx, the numbers are approximately the
21 same. Some are fluctuating, oil being the
22 highest. And, of course, in this case, with the
23 best plant, the coal fired plant will be the
24 best.
25 On the last item over is a particulate
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1 matter. Particulate matter is pretty close to
2 the same, except for the oil powered plant.
3 That is the permitted section that we -- that's
4 been proposed by the hearing officer and in the
5 Department's permit for which we propose
6 approval.
7 That concludes my presentation.
8 I'll turn it back to Mr. Green.
9 MR. GREEN: The Southwest Water
10 Management District would like to make just a
11 very brief statement of their input into this.
12 And then the Manatee County Attorney would
13 like to make a statement. And then we'll get
14 into the public testimony.
15 MR. TSCHANTZ: Good morning, Governor,
16 members of the Siting Board. Richard Tschantz,
17 representing the Southwest Florida Water
18 Management District.
19 We have been asked to speak just briefly as
20 to how the Water Management District fits into
21 the review -- the puzzle here.
22 Primarily our responsibility is to review
23 the amount of water that would be necessary to
24 operate this plant under an increased capacity,
25 and that would be regardless of what fuel is
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1 used, whether it's orimulsion or fuel oil, or
2 even natural gas. If you're going to increase
3 the capacity of this plant, you're going to have
4 to increase the amount of water that it takes to
5 operate the plant.
6 Where that increased amount of water's
7 going to come from is what we take a strong look
8 at.
9 When this application was first submitted
10 to the Water Management District, the plan by
11 Florida Power & Light was to go to the Little
12 Manatee River, increasing the usage of
13 withdrawals from that river from roughly
14 7 million gallons a day up to 16 million gallons
15 a day. And a 23-year old permit agreement was
16 in place that probably would have allowed that.
17 The Water Management District though, in
18 spite of that agreement, was opposed to that
19 amount of water coming out of the Little
20 Manatee River because of what we thought the
21 impacts of that river would be.
22 So at the request of the
23 Water Management District, we asked
24 Florida Power & Light to go back -- you know, or
25 face our opposition, go back and revise the
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1 water plan.
2 And the current plan today calls for a
3 large majority of the water to increase -- to
4 operate this increased capacity plant, coming
5 from reclaimed water or effluent.
6 Secondly, from previously authorized
7 groundwater usage, because the groundwater --
8 new permitted quantities of groundwater are not
9 allowed by the Water Management Districts in
10 this area. So previously authorized water is
11 chosen to be used in the next order of priority.
12 And lastly, the balance of the water needed
13 to operate the plant would come from the Little
14 Manatee River, but in no amounts over what has
15 been historically used over the past 20 years to
16 operate the plant at even a lower capacity.
17 So extensive studies of this river has
18 shown that under these withdrawals that have
19 currently -- ongoing, that the Little
20 Manatee River remains healthy.
21 So in that order of priority is how the
22 water would be used. And that is exactly the
23 type of mix -- mixed sources that the
24 Water Management District today is encouraging,
25 so you don't rely strictly on groundwater,
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1 strictly on surface water. And reuse was never
2 used before in this mix, and it is now.
3 We also have in place as part of the
4 conditions a hydrobiological monitoring program
5 for a period of ten years in which the
6 Water Management District can keep an eye on the
7 river, and if we do see any impacts, we can go
8 back in and seek some changes.
9 The bottom line from the Water Management
10 District perspective is that the Little
11 Manatee River is better off under the plan that
12 is before you today than it is under the old,
13 outdated water use plan.
14 Also, as an added benefit, if the source of
15 this reuse water is going to be the Manatee
16 Agricultural Reuse Supply, which is a program
17 that was cosponsored by the Water Management
18 District, if that is going to be the water where
19 the reclaimed water comes from, then there's an
20 added benefit because Florida Power & Light can
21 take -- in wet weather time periods, can take
22 this reclaimed water and store it when the
23 farmers can't use it, and it would normally have
24 been discharged into the bay. So there's an
25 added benefit here.
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1 Again, from the Water Management District
2 perspective, this project meets all of our
3 rules -- criteria, and it also protects the
4 Little Manatee River.
5 And I'm available for any questions if you
6 have any. We also have John Heuer from our
7 Tampa Permitting -- our Tampa Permitting
8 Director available for questions from the
9 technical end.
10 GOVERNOR CHILES: Question.
11 TREASURER NELSON: You said that there was
12 a great deal, or high percentage, or -- I can't
13 remember your exact words -- of reused water
14 that we're going to --
15 Can you tell us what percentage? Do you
16 have an approximate percentage of the total
17 water consumption, how much of it is going to be
18 from reused water?
19 MR. TSCHANTZ: Rather than percentages, I
20 can give you the exact in million gallons a
21 day.
22 Out of the reclaimed water, 7.7 million
23 gallons a day would be used. And out of the
24 groundwater, previously authorized groundwater,
25 4.3 million gallons a day.
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1 And the remainder of the water, which would
2 be historically out of the river, was 7 million
3 gallons a day. And that represents less than
4 10 percent of the flow of the Little
5 Manatee River, which is part of our rule
6 criteria.
7 TREASURER NELSON: All right. Now, how do
8 you define -- you've got two different -- you've
9 got 7.7 from reused water. Define reused water.
10 And then 4.3 from I think you said
11 groundwater?
12 MR. TSCHANTZ: Yes, sir.
13 TREASURER NELSON: All right. And define
14 that for me.
15 MR. TSCHANTZ: The reused water would be
16 reclaimed water. Or any other alternative
17 source of water, could be storm water. I don't
18 think that that exact source is in place yet.
19 Of course, this -- this plant could not go
20 into effect until that is identified. But from
21 some source of alternative water, either water
22 that is highly treated by -- by Manatee County,
23 or storm water that is treated, or any other
24 alternative source. But not fresh drinking
25 water out of the ground.
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1 TREASURER NELSON: All right. This is the
2 water then -- what you're defining as reused
3 water, this is the water that would otherwise
4 have high nitrous oxide content that would flow
5 into the surrounding waters.
6 MR. TSCHANTZ: If it would not be able to
7 be used, it's sewer water. If it couldn't be
8 used, either by agriculture or Florida Power &
9 Light, it would have to be discharged into the
10 bay.
11 TREASURER NELSON: All right. Now, define
12 the 4.3.
13 MR. TSCHANTZ: The 4.3 million gallons a
14 day of groundwater is water that adjoining --
15 there's an adjoining corporation or Turner Food
16 Corporation that has previously, through
17 history, been authorized to pump water from the
18 ground.
19 And Florida Power & Light had also been
20 authorized by a certain amount of wells to pump
21 water from the ground. But in their mix, they
22 need --
23 (Commissioner Crawford exited the room.)
24 MR. TSCHANTZ: -- to have some fresh
25 water. So that previously authorized water
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1 would come to Florida Power & Light -- sort of
2 what you would call a transfer. And to make up
3 for the groundwater from Turner Foods, that
4 reclaimed water could then go to them, to --
5 And so we're -- we're taking some water out
6 of the ground for Florida Power to use in its
7 cooling pond to get the mix.
8 TREASURER NELSON: So groundwater is well
9 water.
10 MR. TSCHANTZ: Yes, it is.
11 TREASURER NELSON: Okay. So -- so
12 4.3 million gallons of well water, and 7 million
13 gallons out of the Manatee River.
14 MR. TSCHANTZ: Roughly, yes.
15 TREASURER NELSON: From the Little Manatee.
16 MR. TSCHANTZ: Yes.
17 TREASURER NELSON: So 11.3 million of what
18 we would consider basically fresh water.
19 Now, my -- my question then is: From your
20 standpoint, can you replace that fresh water
21 with used water in this mix, and thereby
22 lowering the nitrous oxide that's going into
23 Tampa Bay.
24 MR. TSCHANTZ: You're asking me whether we
25 can go further --
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1 TREASURER NELSON: Can you --
2 MR. TSCHANTZ: -- further use any more --
3 TREASURER NELSON: -- can you raise the
4 7.7 million gallons a day?
5 MR. TSCHANTZ: My understanding is -- is
6 that to get that mix right, no, the answer is
7 no.
8 TREASURER NELSON: Now, why is that?
9 MR. TSCHANTZ: Because -- and I'm really
10 not the best person, and I could --
11 (Commissioner Crawford entered the room.)
12 MR. TSCHANTZ: -- ask someone from
13 Florida Power & Light to address that, or
14 possibly John Heuer, the technical person from
15 the Water Management District. But -- if -- if
16 you're not satisfied with my answer.
17 All I can say to that is is that there has
18 to be a certain mix of the reuse water and the
19 fresh water to have the right quality to be used
20 at the plant.
21 TREASURER NELSON: Okay. I'll get into
22 that later.
23 MR. TSCHANTZ: And we maximized -- from my
24 understanding, we maximized the use of the reuse
25 water that we could possibly use.
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1 TREASURER NELSON: Well, this question you
2 could answer: Is there additional reused water
3 available that if you could get the right mix,
4 is that available from your perspective as the
5 Water Management District?
6 MR. TSCHANTZ: It may be. I -- again, I --
7 I don't know fully the answer to that,
8 because -- I would say probably, yes. There --
9 there are probably other sources that could
10 be -- could be found.
11 TREASURER NELSON: Okay. Thank you.
12 Thank you, Governor.
13 GOVERNOR CHILES: Thank you, sir.
14 MR. TSCHANTZ: Thank you.
15 MR. RICE: Governor Chiles, and members of
16 the Siting Board, I am Hamilton Rice, the
17 Manatee County Attorney. I'm accompanied by
18 Senior Assistant County Attorney Mark Barnebey
19 for the purposes of this proceeding.
20 Under the provisions of Chapter 403 of the
21 Florida Statutes, it was the duty of the
22 Manatee County Board of County Commissioners to
23 determine and file a report with the Department
24 of Environmental Protection stating whether or
25 not the application under consideration today
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1 was consistent with Manatee County's
2 Comprehensive Plan, Land Development Code, and
3 other local ordinances.
4 The Board of County Commissioners
5 specifically found that the proposed project, if
6 constructed, operated, and maintained as
7 described in the application, as supplemented;
8 and subject to 53 conditions attached, which
9 were stipulated to by Florida Power & Light,
10 that the project would be consistent with the
11 nonprocedural aspects of all local ordinances,
12 regulations, standards, or criteria that applied
13 to the project, as well as the -- any applicable
14 local environmental or other local regulations.
15 Inferences to the contrary notwithstanding,
16 whether in writing or spoken in these
17 proceedings, the Manatee County Board of County
18 Commissioners neither approved the project nor
19 opposed it.
20 It neither supports nor objects to the
21 application, as there is no statutory
22 requirement nor authority for the
23 County Commission to do so.
24 The recommendatory duties are those of the
25 DEP and the hearing officer. The decision is
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1 made by you, the Governor and Cabinet sitting as
2 the Power Plant Siting Board.
3 Mr. Barnebey is prepared to answer any
4 detailed questions you may have with respect to
5 the 53 conditions that were arrived at between
6 the County and Florida Power & Light.
7 There are also other county officials
8 present from whom you may hear this morning who
9 will be able to respond to your questions
10 concerning those conditions.
11 GOVERNOR CHILES: Thank you, sir.
12 MR. RICE: Thank you, sir.
13 MR. GREEN: Governor, we have approximately
14 50 speakers. Because of the way it breaks down
15 in proponents and opponents, I would recommend
16 that we set aside an hour for the proponents of
17 the discussion, and an hour-and-a-half for the
18 opponents of the discussion. If that's --
19 GOVERNOR CHILES: Then the proponents --
20 MR. GREEN: -- okay with you.
21 GOVERNOR CHILES: -- and the opponents are
22 going to get together as to how they will
23 utilize that time?
24 MR. GREEN: What we were going to do was
25 call the proponents first, and let them manage
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1 their time. We'll have a timer that we'll keep
2 an accumulative time on them. And we'll let
3 them know.
4 And then the opponents, we'll do the same.
5 GOVERNOR CHILES: Very well.
6 MR. GREEN: We have Peter Cunningham
7 representing the FP&L.
8 MR. CUNNINGHAM: Thank you, Mr. Green.
9 Good afternoon, Governor, members of the
10 Cabinet. I am Peter Cunningham with the law
11 firm of Hopping, Green, Sams & Smith, here today
12 representing Florida Power & Light Company.
13 Perhaps first a procedural matter that I
14 just wanted to get clear, which is if we're to
15 be given an hour for the proponents, I would
16 like to request that I could reserve 10 minutes
17 of that time to come back at the end if, indeed,
18 the procedure is for all the proponents to speak
19 first, and then the opponents.
20 Would that be satisfactory?
21 GOVERNOR CHILES: That'd be fine.
22 MR. CUNNINGHAM: Thank you, sir.
23 We've got a lot of people here today who
24 are knowledgeable about the orimulsion project
25 from FPL; from Bitor, which is the fuel
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1 supplier; from Pure Air, which is the pollution
2 control equipment supplier; as well as a number
3 of scientists and experts who have been
4 analyzing various aspects of the project over
5 the last -- past two or three years.
6 Given the limited time we have today, only
7 a few of this large number of people will be
8 speaking to you.
9 We'll try to hit the high points, and
10 certainly, we'd like to answer any questions
11 that you might have.
12 I would first like to introduce
13 Mr. C.O. Woody. Mr. Woody is the
14 Senior Vice-President of Florida Power & Light
15 Company.
16 He's the senior officer responsible for the
17 planning, construction, licensing, and operation
18 of all of FPL's nonnuclear generation.
19 GOVERNOR CHILES: Mr. Woody.
20 MR. WOODY: Good afternoon, Governor, and
21 members of the Cabinet.
22 GOVERNOR CHILES: Good afternoon.
23 MR. WOODY: It's a pleasure for me to speak
24 on behalf of the orimulsion project.
25 I've been involved in power generation
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1 40 years with Florida Power & Light Company, and
2 have been responsible for construction and
3 oversight of virtually every type of generation
4 that we operate in the state of Florida.
5 I'm pleased that the members of the
6 Department of Environmental Protection have
7 shared with you the extensive review that has
8 taken place to move the project to your
9 consideration.
10 This is a very complex issue, one that has
11 involved a lot of -- of the agencies and the
12 public. We never resisted the involvement in
13 that. And I can assure you that our attitude
14 from the first was, let's find resolutions to
15 those issues that appear to be troubling either
16 the agencies or the general public.
17 Let me share just a little background of
18 Florida Power & Light to set the importance of
19 this project.
20 We are the largest investor-owned utility
21 in the state of Florida, serving about half of
22 the residents of our state. Seven thousand
23 Floridians are served by Florida Power & Light,
24 principally on the east coast, around the
25 southern tip, and up to about Bradenton on the
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1 west coast.
2 We have 14 generating stations located
3 throughout the state, including the west coast,
4 and one power generating station up in
5 mid-Georgia.
6 They are fueled by a variety of fuels.
7 There are two of those stations that are nuclear
8 powered. The balance are fueled with what's
9 called fossil fuels, a combination of residual
10 fuel oil, natural gas, some coal, and we do
11 purchase energy.
12 Let me give you the mix as represented in
13 the hearing. The data that we had at the time
14 of the hearing was for the complete year of
15 1994.
16 Thirty-one percent of the energy delivered
17 to our customers was by residual fuel oil,
18 20 percent by natural gas, 26 percent by nuclear
19 power, 6 percent by coal, and 17 percent by
20 purchased power.
21 The history of our company is that we have
22 had a high dependency on residual fuel oil since
23 the company was chartered 70 years ago. Because
24 of the volatility of the price of fuel oil,
25 particularly after the '70s, we embarked on a
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1 program to decrease our dependency on fuel oil.
2 It consummated during the '70s and '80s
3 with the completion of the nuclear program with
4 four units, putting in place additional
5 transmission circuits into Florida so that we
6 could bring coal power from Georgia, demand site
7 management programs, increasing the availability
8 and volume of natural gas into our state. And
9 all of those things have worked toward our
10 having a fuel mix that is, indeed, better than
11 it was in the early '70s, but still is in need
12 of additional work.
13 We embarked on an alternative fuel program
14 in about 1980. The objective of that program
15 was, of course, to continue to reduce our
16 dependency on oil, and to prevent rate shock to
17 our customers.
18 Commensurate with that program, we began a
19 test at our Sanford plant that's been described
20 by Mr. Green. This test was conducted in 1991.
21 We used orimulsion fuel, we burned 1.2 million
22 barrels of this fuel through a cooperative test
23 with the Department of Environmental Protection,
24 the U.S. Government Environmental
25 Protection Agency.
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1 We characterized and quantified all the
2 constituents of stack emission during that
3 test.
4 We concluded after that test that this fuel
5 is a viable alternative to fuel oil. It handles
6 like oil, it burns like oil, there were no
7 significant surprises in either handling the
8 fuel or in the emissions from the stack.
9 We then embarked on a program of how we
10 might use that in Florida Power & Light. We
11 pride ourself on historically having a very high
12 sensitivity to the environment, the stewardship
13 for the environment.
14 We've been recognized nationwide as one of
15 the leading utilities. Environmentally we're a
16 clean utility. So this project obviously had a
17 lot of scrubbing at the management before we
18 were ready to take it forward for consideration
19 by the agencies.
20 And I want to assure you, in our decision
21 to move forward, in no way did our policy of
22 going beyond the letter of the law
23 environmentally, no way did we violate that
24 policy.
25 And I have strong personal convictions that
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1 this project is environmentally the right thing
2 to do, as well as economically the right thing
3 to do.
4 I would like to share three important
5 features of the project. First of all, it
6 represents a cost reduction, an economic benefit
7 for our customers, as well as for the state of
8 Florida. It offers environmental improvements,
9 and it offers overall economic gains for our
10 state.
11 Concerning the cost. We are still
12 dependent on residual fuel oil for a large part
13 of our generation. We burned 45 million barrels
14 of residual fuel oil in 1994.
15 We have seen, for example, the price of
16 residual fuel oil just in six months of -- the
17 last six months. From November of 1995, we were
18 paying $14.50 a barrel for the fuel oil that we
19 were burning. Today we're paying $20.20 a
20 barrel.
21 The drivers of this increase are beyond our
22 control, they are basically weather driven, and
23 perhaps even influenced by world -- world
24 political issues that we have no control over.
25 But suffice it to say, throughout the
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1 history, we have seen cycles of time when our
2 customers were disadvantaged by the fact that
3 fuel oil particularly, and to a lesser degree,
4 natural gas, has been cyclic and variable in
5 price.
6 This is unacceptable to us, even today, or
7 moving forward in the future, because there are
8 acceptable and reasonable alternatives to being
9 in that position where our customers are
10 disadvantaged.
11 We believe that in burning orimulsion in
12 our Manatee plant, and the arrangement that
13 we've been able to -- to gain with the fuel
14 supplier, that over the life of the plant, given
15 the fuel forecasts that we believe to be very
16 reasonable -- and, in fact, is less than this
17 recent pertubation that we've seen -- that the
18 savings in that 20-year fuel contract period
19 would be in the neighborhood of 4.4 billion
20 dollars. The savings, of course, is a factor of
21 what you believe the future price of fuel oil
22 will be.
23 But everyone who has looked at this, and
24 particularly the Public Service Commission, has
25 concluded that the economic benefits are
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1 remarkable for our customers.
2 In addition to the economic benefits,
3 of course, is the question of fuel diversity.
4 The 31 percent that I mentioned earlier in 1994
5 that was on residual fuel oil would drop down to
6 9 percent with the conversion of our Manatee
7 plant to orimulsion.
8 That would leave us with about -- with a
9 mix in 1999 of 26 percent natural gas;
10 25 percent nuclear; 11 percent orimulsion;
11 9 percent oil; 7 percent coal; and 21 percent
12 purchased power, which is principally coal
13 power.
14 Let me take a moment to speak to the
15 environmental improvements that have already
16 been mentioned. But before I do that, let me
17 just clear up an issue that I think has caused
18 some confusion, and that is the utilization
19 factor of our Manatee plant.
20 Because the Manatee plant is currently
21 fueled only with low sulfur fuel oil, it turns
22 out being one of the highest cost production
23 plants that we have in the Florida Power & Light
24 system.
25 As a consequence, it does not run a great
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1 deal. About 30 percent of the time that it
2 could run, it runs. The way we do that in the
3 state of Florida is our customers are served by
4 the next highest cost megawatt in the state.
5 And because we have a variable demand on
6 electricity and it cannot be stored, we
7 obviously have plants that have to run certain
8 periods of the year, but do not run the entire
9 period of the year. Manatee has been one of
10 those plants that's often referred to as a
11 peaking plant because of its fuel costs.
12 Now, all of our fossil plants, as Mr. Oven
13 has indicated, are -- are licensed without the
14 new pollution control things like scrubbers and
15 electric-- electrostatic precipitators. These
16 plants currently operate well below the licensed
17 emission rate.
18 But with the converse at Manatee with the
19 pollution control equipment that we're
20 proposing, that plant will have a remarkably
21 lower rate of emission than even our existing
22 oil plants that it will displace in this process
23 of running the next most economical plant.
24 Which translates to say that Manatee will
25 run approximately 85 or 90 percent of the time,
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1 and it will -- it will take plants that are
2 currently running in the 50 and 60 percent
3 capacity factor, and relegate them down to a
4 lower capacity factor.
5 The offsets in our state result in an
6 environmental improvement. And I will just
7 quantify those for you. In terms of sulfur
8 dioxide, one of the higher concerns of the EPA
9 and the DEP, the overall state reduction in SO2
10 will be 33 percent, the overall state reduction
11 in nitrogen oxide will be 14 percent, and the
12 overall state reduction in particulates will be
13 18 percent.
14 In addition to the improved air quality, on
15 a local and system-wide basis, this conversion
16 will reduce the risk of fuel spills in Tampa Bay
17 and throughout the state of Florida.
18 Extraordinary measures will be implemented to
19 ensure the safe transport of orimulsion through
20 Tampa Bay.
21 With the Manatee plant generating a much
22 larger portion of the energy in Florida Power
23 & Light, less oil will be moved in plants like
24 Fort Lauderdale; West Palm Beach;
25 Cape Canaveral; Miami; and Fort Myers, which,
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1 of course, uses Boca Grande.
2 It would be unfair to neglect the economic
3 benefits of this fuel. There will be an overall
4 5 percent reduction in the price of energy to
5 all of our customers.
6 While everything else is increasing in our
7 world, it's encouraging to believe that by
8 technology we can find a way to lower the price
9 of electricity to our customers.
10 It improves the competitive position,
11 particularly of our large industrial and
12 commercial customers. It creates jobs, and
13 growth, and taxes in our state.
14 And incidentally, all of these benefits,
15 all of these benefits are passed along to our
16 customers. None of them go to our shareholders.
17 We calculate that all of our customers will
18 benefit. The residential customer will save
19 about $42 a year, while our larger industrial
20 customers will save as much as a million dollars
21 a year on their energy bill.
22 We also calculate that for government and
23 tax supported customers, including the schools,
24 that they will save 12.9 million dollars a year
25 with this lower electricity rate in our state.
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1 There are local benefits. Three hundred
2 and forty-seven construction jobs, forty new
3 permanent jobs, sixty-nine new indirect jobs; an
4 increased payroll in the Manatee County area of
5 3 million dollars; a million-and-a-half dollars
6 in increased port fees; and about $700,000 in
7 property taxes, incremental property taxes.
8 Statewide, more of those dollars will be
9 spent, and we believe will result in what might
10 be called leveraging this benefit for jobs and
11 revenue in our state.
12 This project is extremely important to our
13 state and to our company. We've studied it
14 six years, we've performed experiments and
15 tests, we've involved the very best minds, we
16 have covered all the bases and worked out the
17 technical detail.
18 We're asking that the evidence of fact that
19 has been presented and studied by the many
20 agencies, and that the demonstrated compliance
21 that will be assured through the monitoring is
22 recognized, and that this Siting Board in your
23 wisdom grant us the right to convert and operate
24 our plant at Manatee with orimulsion fuel.
25 If there was any doubt about this, I
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1 wouldn't stand and ask for your permission to do
2 it. Florida Power & Light has historically had
3 a high sensitivity to the environment and its
4 customers. That philosophy has not changed.
5 And I assure you that the commitments that
6 we've made will be honored, both in the local
7 level, and to our customers and the citizens of
8 Manatee County.
9 We urge you to see these benefits, and have
10 the steadfast resolve to allow the licensing and
11 monitoring to work as designed.
12 Thank you for allowing me to present these
13 comments on this very important project.
14 GOVERNOR CHILES: Thank you, sir.
15 Question.
16 TREASURER NELSON: Yes. Mr. Woody --
17 (Governor Chiles exited the room.)
18 TREASURER NELSON: -- tell me something
19 about your mathematical calculations on savings
20 of 4.4 billion dollars. And you said that
21 translates to a 5 percent reduction in the
22 bills.
23 Walk us through that. Over what period of
24 time, when does that kick in, et cetera,
25 et cetera.
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1 MR. WOODY: It would begin with the initial
2 operation, which according to the schedule that
3 we have, would be the first unit completed at
4 the end of 1997, and the second unit in the
5 spring of 1998.
6 So it would be at that time frame before we
7 would recognize the fuel cost reduction. In
8 Florida we have a fuel clause that passes
9 through the cost of the fuel to our customers.
10 And if we look at the most recent fuel
11 forecast of what we will be paying for residual
12 fuel oil, and we compare that to what we will be
13 paying for orimulsion, and we calculate that
14 over the 20-year period, the contract life of
15 this fuel supply contract, it translates to
16 4.4 billion dollars.
17 We have all of that detailed, it's been
18 extensively reviewed by the Public
19 Service Commission. But that's generally the
20 methodology.
21 TREASURER NELSON: Now, the flipside of
22 that, if there were any unexpected losses, is
23 there any hold harmless that the customers are
24 not going to be penalized from any unexpected
25 losses?
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1 MR. WOODY: If, for example, for -- for
2 technical reasons, we could not burn orimulsion,
3 our contract holds our customers harmless in
4 that our fuel supply company would have to
5 supply high sulfur -- high sulfur residual fuel
6 oil for a period of time to offset the expense
7 that we would have invested in the pollution
8 control equipment, which, incidentally, is about
9 250 million dollars.
10 TREASURER NELSON: All right. And just to
11 recapitulate, you said that the 5 percent kicks
12 in when?
13 MR. WOODY: At the time when we're able to
14 start burning the fuel, which we would get a
15 small part of it in the last part of '97, but
16 we'd recognize the entire benefit after the
17 first quarter of '98.
18 TREASURER NELSON: Okay.
19 (Governor Chiles entered the room.)
20 TREASURER NELSON: Now, let me ask you
21 about some of the emissions, the nitrogen oxide.
22 In essence, with what is your actual oil
23 use now in the plant, you're going to basically
24 cut the sulfur dioxide in half. And what is now
25 compared to the actual oil consumption at the
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1 plant, you're going to virtually double the
2 nitrogen oxide.
3 Now, the -- I would be curious -- now,
4 picking up on my question of the gentleman from
5 the SWFWMD, since you're doubling the tons per
6 year of nitrogen oxides that are basically going
7 into Tampa Bay by virtue of the increased use of
8 the plant and this new fuel, can you not offset
9 that by the use of reused water, which otherwise
10 would end up in Tampa Bay, and, therefore, you
11 could lower to the end result, which is
12 Tampa Bay, the amount of nitrogen oxides.
13 Tell us about that.
14 MR. WOODY: I will not profess to be an
15 expert here. But let me give you at least a
16 management answer.
17 We believe that we can offset the nitrogen
18 deposition into Tampa Bay. There's really two
19 issues here. There's the nitrous oxides that
20 comes out of the stack, and then there's the
21 calculated nitrogen deposition into Tampa Bay.
22 And we have been working with -- with the
23 various agencies to quantify the benefit of
24 taking the reused water that now goes into
25 Tampa Bay, and using that water at the plant,
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1 and thus reducing the nitrogen deposition into
2 Tampa Bay.
3 We are doing that, and we're prepared to
4 proceed with that. Perhaps others can give more
5 detail on that if you will allow me to defer
6 that more detailed answer to them.
7 TREASURER NELSON: Can you offset it by
8 100 percent of your increase of
9 nitrogen oxides?
10 MR. WOODY: I -- I do not know that.
11 Perhaps there's someone here in the room that
12 does know it. But if we can, we will -- we have
13 no problem making that commitment if we jointly
14 believe that we can do that.
15 Let me clear one other thing, Mr. Nelson.
16 It is true that we will be doubling --
17 approximately doubling the NOx out of the
18 Manatee plant, because we'll be running it three
19 times more.
20 But on a statewide basis -- and I think
21 this is extremely important to this
22 Siting Board -- on a statewide basis, we'll be
23 lowering the NOx in our state by 10,000 tons,
24 which is an overall improvement in the state,
25 of course.
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1 TREASURER NELSON: But over time, that
2 lowering wouldn't be permanent, because over
3 time, you're going to increase the use of those
4 oil plants elsewhere in the state.
5 MR. WOODY: We've looked -- we've looked at
6 that over the period of the 20 years. And
7 it's -- it averages out 10,000 tons over the
8 20-year period.
9 It does diminish slightly in the outreach
10 years, but it never falls below seven or
11 eight thousand improvement.
12 TREASURER NELSON: All right. If -- if you
13 could, somewhere in the course of your
14 presentation, answer the question. If you can
15 offset the nitrogen oxides by 100 percent of
16 what ends up in Tampa Bay, I would appreciate an
17 answer to that.
18 MR. WOODY: We will have you an answer.
19 TREASURER NELSON: Thank you.
20 Thank you, Governor.
21 MR. WOODY: Thank you very much.
22 MR. CUNNINGHAM: Treasurer Nelson, I can
23 I think answer your question.
24 I think it is possible, by a number of
25 different ways to offset, if you will, the
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1 additional nitrogen that would go into Tampa Bay
2 due to the increased NOx emissions.
3 Again, as Mr. Woody explained, you have two
4 things, you have nitrogen oxides being emitted
5 into the air, some relatively small percentage
6 of that falls on the ground or falls on the
7 water and ultimately gets into the bay.
8 In this case, about 18 metric tons of
9 nitrogen into the bay above that which has been
10 happening historically due to the operation of
11 this plant.
12 If the question is: Would it be possible
13 to offset in some manner that 18 metric tons? I
14 have to believe the answer would be yes. There
15 would be a number of ways you could do it. One
16 of them has been mentioned. I think it started
17 you on this question originally.
18 It had to do with the use of reclaimed
19 water from wastewater treatment plants, some of
20 which in this part of the state, are still
21 discharging directly into rivers, and quickly
22 that nitrogen gets into Tampa Bay.
23 We'll try to move it along here.
24 The next person I'd like to introduce is
25 with Bitor, the fuel supplier, which is a
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1 company with offices in Boca Raton, but
2 ultimately is a Venezuelan company and part of
3 the Venezuelan national petroleum company called
4 Petroleos de Venezuela, which is, I believe, the
5 second or third largest energy company in the
6 world.
7 I'd like to introduce you to
8 Mr. Nelson Garcia. He's Vice President for
9 Operations and Environmental Affairs for
10 Bitor America.
11 MR. GARCIA: Good morning.
12 As Peter Cunningham just said, my name is
13 Nelson Garcia. I am the Vice President of
14 Operations and Environmental Affairs for
15 Bitor America Corporation, which is the fuel
16 supplier for this project.
17 Bitor is one of the companies, members of
18 the PDVSA group of companies,
19 Petroleos de Venezuela, which is the state owned
20 oil company of Venezuela.
21 We are not only the state owned company of
22 Venezuela. As Peter said, we are the second
23 largest energy supplier in the world, and we are
24 the first supplier of fuel and oil to the
25 United States.
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1 Venezuela has been supplying oil to the
2 United States for the last 80 years with an
3 excellent record of reliability. We've supplied
4 oil and fuel, no matter what the political
5 situation in our country and in the world has
6 been.
7 We supplied oil and -- and fuel to the
8 United States during World War II, during the
9 Korean War, during the Viet Nam War, during the
10 embargo of the '70s from the Arabian countries,
11 and recently through the Gulf War in Kuwait.
12 We do this because oil and energy is very
13 important to our country. It's our main source
14 of income.
15 Bitor, the supplier of fuel, has put a
16 great effort in putting together a safe plan --
17 a safety plan for the transportation of
18 orimulsion through international waters, through
19 U.S. waters, and through Tampa Bay.
20 We have received endorsement from the
21 Coast Guard for the excellent measures that
22 we've taken in order to guarantee the low
23 probability of a spill in these -- the areas
24 I've just mentioned.
25 Lastly, I would like to emphasize the
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1 commitment from Petroleos of Venezuela and from
2 Bitor to maintain a long established record of
3 reliable supply of fuel to the United States,
4 and the commitment of Petroleos of Venezuela and
5 Bitor to implement all the safety conditions
6 that have been approved in order to bring
7 orimulsion safely into Tampa Bay for the next
8 20 years.
9 Governor Chiles, members of the Board of
10 Siting -- Siting Board, we ask you to consider
11 our excellent record in supply, and our
12 excellent record in safety. And we urge you to
13 approve this project.
14 Thank you very much.
15 GOVERNOR CHILES: Thank you, sir.
16 MR. CUNNINGHAM: I would next like to
17 introduce to you Mr. Bob Conley. Mr. Conley is
18 the president of Pure Air.
19 MR. CONLEY: Governor Chiles, members of
20 the Cabinet. In the interest of time, I'll try
21 to keep my comments brief. But I'd be happy to
22 respond to any questions you have.
23 Pure Air is an Air Products company.
24 Air Products will own and operate this facility
25 through Pure Air. Air Products may be known to
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1 some of you, but maybe not quite as well as our
2 partner in this project, FPL. And I'd just like
3 to provide a little background on our company.
4 We're a 4 billion dollar corporation. We
5 have 15,000 employees around the world. We
6 operate in 30 countries with hundreds of plants
7 in the industrial, gas chemicals, and energy,
8 and environmental area.
9 We're very active in Florida. We've been a
10 member of this community for -- for over
11 40 years. We currently operate ten facilities
12 here, have 400 employees.
13 Some of the customers that we serve here
14 are NASA, with hydrogen for the space shuttle
15 program. We provide power to -- to Disney World
16 through a cogeneration facility we built. And
17 we have a very strong base of operation and
18 customer base here.
19 We, I think like FPL, as a corporation have
20 a very strong commitment to stewardships of the
21 environment and our communities. And if I
22 could, I'd like to focus just a second on the
23 issue of community.
24 We as part of this process have agreed to
25 many conditions involved in the project in doing
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1 what we could to respond to issues and concerns
2 raised by the community.
3 But I'd like to provide the assurance that
4 our commitment to being a good citizen in the
5 community, if this project's approved, won't
6 stop with this process.
7 Our employees, our company, are extremely
8 active in supporting education and in donating
9 computers and books and needed supplies to
10 schools in the communities where we operate
11 facilities.
12 We lead programs to donate food and repair
13 housing and shelters for the needy in the area.
14 And I could spend time pointing out hundreds of
15 programs that our company's involved in. That's
16 part of the opportunity we'll hope -- we hope
17 we'll have with this project.
18 I think the other point I'd like to
19 emphasize is the fact that -- that there are
20 some questions because orimulsion is new,
21 sometimes the word experimental is used in
22 refer -- in reference that orimulsion is a
23 fuel.
24 But the facts are that orimulsion has been
25 burned commercially for over four years now in
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1 various countries around the world. Today it is
2 currently operating in six facilities.
3 We visited every one of those facilities
4 and met with the companies that operate the
5 orimulsion facilities to make sure we understand
6 all the issues associated with designing and
7 operating the air pollution control systems for
8 the plant.
9 Through our partnership with Mitsubishi
10 Heavy Industries, whose technology we're using
11 for this project to clean up the SO2 emissions
12 and particulate emissions, we have specific
13 experience with four orimulsion projects in
14 Japan.
15 So we are not only confident to stand up
16 and say that we will meet all the permit
17 conditions that are required for the air
18 emissions, but we've guaranteed that, not just
19 initially, but for the full life of our contract
20 of 20 years or more with FPL.
21 So I think we say that based upon
22 experience and knowledge of the operating
23 systems, the use of a technology that has over a
24 30-year track record of treating flue gas from
25 similar plants that are burning coal and pepco
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1 fuel oil, other fuel oils that have similar flue
2 gas characteristics.
3 In closing, I'd like to say that -- that
4 our company would very much like the opportunity
5 to invest almost 200 million dollars in air
6 pollution control systems to improve the economy
7 and the environment in Florida.
8 We'd like the opportunity to create jobs in
9 the area, and we'd like an opportunity to expand
10 our role as a good citizen in the communities
11 where this plant will reside.
12 And I sincerely hope you'll give us that
13 opportunity.
14 Thank you.
15 GOVERNOR CHILES: Thank you, sir.
16 MR. CUNNINGHAM: Members of the Board, I --
17 we have a number of people here who are experts
18 in one field or another.
19 But one I had hoped you would listen to
20 briefly -- or actually two, have to do with an
21 issue which was somewhat unique through this
22 project and had to do with the fuel
23 transportation, potential for a spill of this
24 fuel, which is a different fuel from any that's
25 coming into Florida at this time.
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1 Now, for that reason, let me first
2 introduce to you Dr. Jerry Ault. He's Assistant
3 Professor of Marine Biology and Fisheries with
4 University of Miami, Rosenstiel School of Marine
5 and Atmospheric Sciences.
6 DR. AULT: Afternoon, Governor, and
7 Cabinet.
8 Like to have a few brief remarks this
9 afternoon. I was codirector of the study COSAP,
10 which was Comparative Oil Orimulsion Spill
11 Assessment Program.
12 The principal conclusion of that study was
13 in terms of ecological risks to Tampa Bay
14 system, the regional system. The risks are
15 essentially comparable between a spill of fuel
16 oil, Number 6, or -- and orimulsion.
17 That conclusion was not reached lightly.
18 There was a significant study which involved
19 basically a 1.5-year peer re-- scientific peer
20 reviewed study, which was multi-university,
21 multi-collaborator involved.
22 Essentially FPL stated the objective of the
23 study, but the universities themselves were able
24 to go out and independently assess what was
25 needed in terms of scope, requirements, and
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1 conclusions for the study.
2 The study itself is indexed in a
3 multi-volume report, which is part of the court
4 record. And I'm happy to answer questions about
5 it, but I'd like to briefly overview what was
6 involved in that study and how we reached our
7 conclusions itself.
8 In essence, we conducted a state of the art
9 comparative ecological risk assessment which
10 articulated the physical, chemical, and
11 biological dynamics of Tampa Bay.
12 The study itself was to look at the
13 relative risks of exposure, because the fuels
14 themselves differed in the way that they -- they
15 enter the environment, they react with the
16 environment, and react with organisms in the
17 systems.
18 In essence, the study involved three major
19 components. There was a very sophisticated
20 hydrodynamic model, which was three
21 dimensions -- actually four. Three physical
22 dimensions in time, which gave good
23 recapitulation of the physical dynamics of
24 Tampa Bay, and, in fact, was validated by
25 independent methods using -- in fact, acoustic
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1 doppler current profiles, and others.
2 Secondly, part and parcel of that system
3 was a fate and transport model, which
4 essentially looked at the physical, chemical,
5 and weathering characteristics of the fuel
6 itself, and could estimate the -- the
7 trajectories of the fuel.
8 That combined modeling system itself was
9 validated as a function that actually gave a
10 good hindcast, excellent hindcast of the 1993
11 fuel oil spill in Tampa Bay. So we had
12 reasonably good confidence in its performance.
13 We also had, because of Tampa Bay's
14 extensive hi
