Order 7 - Ocean State Power: Final Decision and Order

STATE OF RHODE ISLAND

ENERGY FACILITIES SITING BOARD

IN RE:

APPLICATION OF OCEAN STATE

POWER FILED JANUARY 13, 1987

TO SITE AND CONSTRUCT A MAJOR

ENERGY FACILITY

Docket Number S. B. 87-1

FINAL DECISION AND ORDER

TABLE OF CONTENTS

0215X

STATE OF RHODE ISLAND

ENERGY FACILITIES SITING BOARD

IN RE:

APPLICATION OF OCEAN STATE

POWER FILED JANUARY 13, 1987

TO SITE AND CONSTRUCT A MAJOR

ENERGY FACILITY

Docket Number S. B. 87-1

FINAL DECISION AND ORDER

I. INTRODUCTION

a. Application

On January 13, 1987 Ocean State Power (OSP or Applicant) applied to the Energy Facility Siting Board (EFSB or Board), for a license to site and construct a natural gas-fired, combined cycle, electric generating facility consisting of two 250 megawatt (MW) units in Burrillville, Rhode Island. [1 The original application called for two 235 MW units. The capacity of each unit was later increased to 250 MW.] Either unit is a "major energy facility" subject to Board jurisdiction since each unit has greater than 80 megawatt capacity. R.I. Gen. Laws Sec.42-98-3. OSP will use natural gas to be supplied under a 20-year contract with Canadian gas producers as the primary fuel. No. 2 fuel oil will be used as a backup fuel source. Natural gas will be transported by TransCanada Pipelines from western Canada to New York State. Thereafter an existing Tennesee Gas Transmission Company (Tenneco) pipline will transport the gas to Sutton, Massachusetts. A short pipeline from the existing Tenneco gas pipeline will be constructed to serve the proposed OSP site. A six inch oil pipeline will supply the backup fuel.

OSP's application to the Board only involves the generating facility itself, not the proposed pipeline connection, which is, at least in part, under Federal Energy Regulatory Commission (FERC) jurisdiction. Thus, the following decision only addresses the siting and construction of the two proposed 250 MW generating units.

The proposed OSP facility is to be located on a forty acre site located east of Sherman Farm Road next to a Blackstone Valley Electric Company switching station. The facility itself will occupy approximately fifteen acres, with the remaining area devoted to parking and buffer areas. The building will be approximately sixty feet high with two, one hundred fifty foot exhaust stacks and two, forty-three foot cooling towers. Existing 345 kilovolt transmission lines cross the site, so no new electric transmission lines will have to be built to support the OSP facility. An Algonquin Gas Company pipeline also crosses the site. A proposed pipeline from a pumping station to be located along the Blackstone River in Woonsocket will supply cooling water for the facility. The facility will recycle cooling water and has been designed for a zero-water discharge.

OSP will supply power to the Boston Edison Company, New England Power Company, Eastern Utilities Associates, and the Newport Electric Corporation through the New England Power Pool (NEPOOL). OSP projects service will begin approximately twenty-seven months after construction commences. OSP Exhibit 25 at 5.

The OSP application initially projected a cost in 1986 dollars of $160.8 million dollars for the first unit and a first-year cost of generation of 5.9 cents per KWH. At the estimated 20-year life of the initial unit, the levelized cost of generating, i.e. OSP's cost, was estimated at 6.4 cents per KWH. OSP Exhibit 1 at 23.

b. Energy Facility Siting Board

The Board is composed of the Chairman of the Public Utilities Commission, who serves as Chaiman of the Board, the Director of the Department of Environmental Management, and the Chief of the Office of Statewide Planning. Edward F. Burke chaired the Board through the initial phases of this application, but resigned as Chairman of the Public Utilities Commission and, therefore, the Board effective May 1, 1988. His successor as Chairman of the Public Utilities Commission, James J. Malachowski, recused himself from serving as Chairman of the Board for this application, because of his prior duties as state coordinator for the Ocean State Power Project Environmental Impact Statement (EIS), while Director of the Governor's Office of Intergovernmental Relations. Pursuant to 1988 Rhode Island Public Law, Chapter 39, Chairman Malachowski designated former Public Utilities Commissioner Mary N. Kilmarx, then Deputy Director of the Governor's Office of Energy Assistance, to serve as Chairperson for the remainder of hearings in this matter.

c. Travel

The preliminary hearing in this matter convened on April 13, 1987, and the Preliminary Decision was issued on May 22, 1987. Order No. 1. This decision was subsequently modified on September 23, 1987 to include consideration of both generation units. Order No. 2. Representatives of OSP, the Audubon Society of Rhode Island (Audubon), the Division of Public Utilities and Carriers, the Department of Environmental Management, and the Statewide Planning Program appeared at the preliminary hearing. Subsequently, the Town of Burrillville (Town) and the Concerned Citizens of Burrillville/Uxbridge (Concerned Citizens) intervened as parties. Order No. 4. [2 While the Concerned Citizens intervened, no attorney appeared to represent the organization and cross-examine or present witnesses at evidentiary hearings held at the Board's Providence offices. Members of Concerned Citizens did testify at the evening hearings held in Burrillville.]

The Preliminary Decision designated the following municipal and state agencies to act at the direction of the Board for the purpose of rendering advisory opinions regarding issues identified in the Preliminary Decision: 1) City of Woonsocket Zoning Board of Review, 2) City of Woonsocket Office of Building Inspector, 3) City of Woonsocket Department of Public Works, 4) Town of Burrillville Zoning Board of Review, 5) Town of Burrillville Office of Building Inspector, 6) Rhode Island Water Resources Board, 7) Rhode Island Department of Transportation, and 8) Rhode Island Department of Environmental Management (DEM). As required by statute, the Board also received separate advisory opinions from the State Planning Council as to socio-economic impact and conformance with the state guide plan, and the Public Utilities Commission as to need. R.I. Gen. Laws Sec.42-98-9(D), (E). At the request of the Board, DEM submitted an advisory opinion as to overall environmental impact. Preliminary Decision at 15.

On January 7, 1988, pursuant to statutory requirements, the Board convened the final hearing in this matter. Prior to this date, OSP had requested that the Board suspend final hearings until a draft environmental impact statement was prepared and published by the FERC. In its Preliminary Decision, the Board concluded that an EIS was essential to its deliberations. Id. at 5-7. Since FERC must approve the construction of the gas pipeline connector, which may have significant environmental impacts, an EIS is required under the National Environmental Policy Act, 42 U.S.C.A. Sec.4321 et seq., and such an EIS must encompass both the pipeline and generating facility. The Board granted permission to suspend, Order No. 3, and an additional suspension occurred on May 10, 1988. 5/10/88 Tr. 37.

FERC published the draft EIS in March 1988 and final hearings reconvened on May 23, 1988 at which time OSP and the Town presented testimony in support of the OSP application. The Board received public testimony at an evening public hearing in Burrillville on June 8, 1988 and suspended further hearings until after the publication of the final EIS. 6/8/88 Tr. 153. FERC published the final EIS on July 8, 1988 and hearings reconvened on August 2, 1988. A second evening hearing was held in Burrillville on August 16, 1988. Final testimony was received on September 2, 1988.

d. Legislative Charge

The Board was created to consider the need for energy facilities "in relation to the overall impact of such facilities upon public health and safety, the environment and the economy of the state", and to insure that such facilities are "planned for, considered and built in a timely and orderly fashion". R. I. Gen. Laws Sec.42-98-1(A); Sec.42-98-2(A). To accomplish that goal, the Board was designated as the "licensing and permitting authority for all licenses, permits, assents, or variances which, under any statute of the state or ordinance of any political subdivision of the state, would be required for siting, construction or alteration of a major energy facility in the state of Rhode Island". Id. Sec.42-98-7(A).

The Board's ability to comprehensively consider all aspects of the OSP application in a timely manner has been significantly complicated by the lateness in which the EIS was sought by OSP, the piecemeal manner in which information has been submitted to the Board and the statutory exemption from Board jurisdiction of most substantive DEM permits. Id. Notwithstanding that the proposed energy facility will impact the environment and must obtain federal approval for importation of gas and construction and siting of the gas pipeline from Sutton, Massachusetts, an EIS was not sought by the Applicant until spring of 1987, after filing of the initial application with the Board. Because statutorily mandated hearings had to convene prior to the promulgation of the EIS, the Board was compelled to suspend hearings on various occasions to comply with the statutory sixty day hearing limit. Id. Sec.42-98-11(A). Had the EIS been submitted prior to the commencement of final hearings, these proceedings could have been conducted more efficiently.

In addition, the Board now faces the task of ruling on the license prior to the final DEM decisions on air, water and wetlands permits. Thus, it has not been possible for the Board to comprehensively consider all environmental permits. This is not a criticism of DEM; applications for permits sought by OSP are necessarily complex and voluminous. This simply points out that the Board cannot achieve the comprehensive review intended by the General Assembly.

Finally, confusion has arisen over the Board's adjudicatory role. Because the Board has a discreet application before it, it must sit as an adjudicatory body ruling on that application. Certain parties to this hearing have sought to have the Board serve as a planning body. In particular, members of the public have requested that the Board determine the best possible site for an energy facility in Rhode Island, notwithstanding that a specific application, and not an energy plan, is before the Board.

e. The Board's Response

The Board's response to these difficulties is based on the Energy Facility Siting Act's (Act's) policy directive that the Board consider a comprehensive range of issues in a timely manner. Thus instead of dismissing the application or taking no action whatsoever until a final EIS was published, the Board chose to conduct hearings and continue the Board process while the EIS was developed. This decision to go forward, however, always assumed that hearings would not end until a final EIS was published and considered by the Board, the parties, and the public. By proceeding in this manner, the Board could respond promptly to the application, given the practicalities of this situation, while preserving the rights of the parties and the public's access to full information and participation in the process. In addition the Board on its own initiative sought information and supplemented the record, always subject to comment and challenge by the parties.

Given the strict statutory time frame for the conduct of final hearings, the Board suspended the conduct of the hearings on three different occasions without objection by the parties, so that the statutory time limit on final hearings would not be exceeded. In the Board's opinion this was the most practical way to balance timeliness with a comprehensive review of all issues.

The Act does mandate a planning process undertaken by the Statewide Planning Program to establish state energy plans, goals and policies. Id. Sec.42-98-2(E). In contrast to a planning body, the Board is mandated to consider applications and approve or disapprove licenses for specific energy facilities. Thus, the Board in the first instance is an adjudicatory body which must pass on the specific application presented to it. While the Board must consider planning documents and the relationship of a specific application to state and local plans, the Board has the power only to determine whether a specific application will be in accord with plans and programs and whether the impact of the facility is acceptable.

II. NEED

a. Regional Increase in Energy Demand

To obtain a Board license the Applicant must show that "construction of the proposed facility is necessary to meet the needs of the state and/or region for energy of the type to be produced by the proposed facility" and that "a proposed facility is cost-justified and can be expected to produce energy at the lowest reasonable cost to the consumer". Id. Sec.42-98-11(B); see also Preliminary Decision, Issue 1 and 6. The Board on its own initiative determined that alternative means of generation should also be investigated. Preliminary Decision, Issue 9.

Since the Act mandates that the Public Utilities Commission (Commission) conduct an investigation and render an advisory opinion as to the need for any proposed facility, R. I. Gen. Laws Sec.42-98-9(D), and since the EIS also did a separate need analysis, the Board did not undertake an independent investigation of the need for the OSP facility. The Commission's findings in its Docket No. 1889 Advisory Opinion, as shown below, are consistent with the conclusions made by the FERC staff in the final EIS and, in fact, generated little or no controversy during the Commission's Docket No. 1889 hearing and the final hearings before this Board. The major participants in the Board hearings, OSP and Audubon, participated in the Docket No. 1889 hearing.

Energy demand and peak power demand are growing in New England. A NEPOOL study forecasts that the annual energy growth is 1.7%, summer peak demand growth is 2.7% and winter peak is 1.5%. EIS at 2-6. Other studies reviewed in the EIS assume a 2.2% to 4.5% annual load growth. While estimates of future load growths may vary widely according to the assumptions on which the estimates are based, it is clear that peak demand in New England has actually been increasing faster than any of the forecasts. The system peak reached in January 1988 had been projected by NEPOOL for the winter of 1993-4. Absent NEPOOL's Operating Procedure 4, which curtailed the load by approximately 500 megawatts, it is estimated that the peak would have equaled the 1995-6 forecasted winter peak. Id. at 2-26. The Board has also taken notice that, since publication of the EIS, system peaks in July and August of 1988 also greatly exceeded the NEPOOL forecast.

No information was submitted to the Board which contradicts the conclusion that energy demand is growing in New England. One study, however, did challenge the need for additional generating capacity to meet that load growth. The New England Energy Policy Council in its Power to Spare report in 1987 concluded that, by increasing the efficiency in which energy is used, the need for additional generation could be reduced or eliminated for the foreseeable future. The New England Energy Policy Council raises important points regarding the role of energy conservation and efficient usage. The Rhode Island Public Utilities Commission and Governor's Office of Energy Assistance have long emphasized the importance of conservation and efficiency. NEPOOL demand projections have already been significantly reduced to reflect conservation and load management activities of its member utilities. Id. at 2-52. We believe, however, that to have so substantial an impact as to preclude the need for new generation, such policies would have to be adopted and implemented immediately on a region-wide basis to the full extent of their technical potential. To institute such policies on that basis would require considerable time before energy saving devices and policies could gain public acceptance and become widely used. Id. at 2-25. Thus, we do not believe that the New England Energy Policy Council Power to Spare report provides a basis to conclude that there is no need for OSP generation.

b. Public Utilities Commission Advisory Opinion

The Commission in its Docket No. 1889 advisory opinion examined in-state generating capacity, long-term need and short-term need. As to in-state capacity, the Commission concluded that, since the proposed units would almost double and triple, respectively, the current minimal in-state generating capacity of 267.25 megawatts, the proposed units are "needed from the standpoint of pure self-sufficiency". Exhibit OSP 3 at 8. The State Planning Council concurs. Exhibit OSP 4, Finding 1. Even if OSP is added to the generating capacity in Rhode Island, in-state generating capacity will be much less than the statewide demand for electric power. Id. at 2-23.

As to long-term need, the Commission considered, as did the EIS, the "NEPOOL Forecast of Capacity, Energy, Loads and Transmission, 1987-2002" (1987 CELT Report) which projected a need for the next unit of regional generation in 1995. Exhibit OSP 3 at 6. In addition the Board took notice of the 1988 CELT Report. Both reports are consistent with the EIS conclusion that "a need for power will occur in the mid to late 1990s." EIS at 2-25.

As to short-term need, the Commission considered the possibility of delay in obtaining energy from the Seabrook Nuclear Power Station and indeed the distinct possibility that no power will ever be generated by Seabrook and concluded that prudent planning dictated the short-term need for the proposed OSP units. Exhibit OSP 3 at 6-7.

In addition to need, the Act conditions the grant of a license on a finding that the energy produced by OSP will be cost-justified and can be expected to produce energy at the lowest reasonable cost. R. I. Gen. Laws Sec.42-98-11(B)(2). The projected busbar power cost from units 1 and 2 current and levelized over twenty years, is 8.8 cents and 9.07 cents per KWH respectively. EIS at 2-24. This compares favorably with potential oil and coal generation and rehabilitation of existing plants. Id. While domestic and Canadian hydro-power and PURPA avoided cost generation may potentially produce lower cost power, nothing in this docket has shown that there is a realistic potential that such low cost sources of power will be available by the mid-1990s in amounts that will obviate the need for the OSP units. New nuclear generation of course is too speculative to be considered as a reasonable alternative.

Based on the above, the Board concludes that the generating capacity from the proposed OSP units 1 and 2 will be necessary to meet the electric generation needs of the state and the region, since all scenarios project the need for additional energy by the mid-1990s and since the proposed units will substantially increase generation capacity in Rhode Island. Cost data show that projected OSP costs per kilowatt hour will be below alternative forms of generation, except hydro-power and PURPA avoided cost generation. Since there is no basis in the record to conclude that alternative forms of generation will obviate the need for OSP units 1 and 2 and since common sense dictates that a diverse mix of generation capacity is prudent, we conclude that proposed units 1 and 2 are cost-justified, will produce energy at the lowest reasonable cost and that alternative means of generation will not obviate the need for the units. See Preliminary Decision, Issues 1, 6 & 9.

III. LOCAL GOVERNMENT

While Board authority preempts local governmental authority over town licenses, etc., that would ordinarily be required for a major energy facility, town consideration of major energy facility impacts is essential to any Board finding regarding socio-economic impact. This Board has attached great weight to local governmental actions in this docket.

a. Building Permits and Other Technical Permits

In its Preliminary Decision, the Board requested advisory opinions from the Woonsocket and Burrillville Zoning Boards of Review respectively as to whether a variance or special exception should be granted for the proposed OSP Blackstone River intake structure and as to whether a variance or special exception should be granted for the OSP facility itself. Preliminary Decision at 13. In addition, the Board requested advisory opinions from the Woonsocket Office of Building Inspector, the Woonsocket Department of Public Works and the Burrillville Office of Building Inspector regarding compliance with building code provisions, etc. Id. The Board received advisory opinions from the Woonsocket and Burrillville Zoning Boards of Review. It did not receive advisory opinions from the Building Inspectors or Department of Public Works and the Board concludes that it would be impossible at this time for the Building Inspectors and Department of Public Works to comment regarding compliance with local building codes, since the specific design and final construction drawings necessary for a building code review are not available and undoubtedly will not be developed unless a Board license is granted for the OSP units. A similar problem has occurred regarding DEM review of the permit for OSP's waste water clarification system. 9/1/88 Tr. 112.

This situation presents a technical and not insignificant problem for the Applicant and the Board. The Board is the licensing and permitting authority for "all licenses, permits, assents or variances which under any statute of the state or ordinance of any political subdivision of the state would be required for siting, construction or alteration of a major energy facility." R.I. Gen. Laws Sec.42-98-7(A). As with any structure, a building permit is required for construction of an energy facility in Burrillville or Woonsocket. Thus, the Board has the authority and obligation to issue such permits.

But common sense dictates that such permits should not be issued until a thorough review of the design and final construction drawings and it is unreasonable to require the applicant for a major energy facility to complete detailed design and construction drawings prior to a decision regarding the Board license. If a license is granted such drawings can be developed. If a license is denied the applicant need not be burdened with the costs of detailed final design.

The most effective way to address this problem is to create a post licensure proceeding whereby permits of a technical nature, such as building permits, can be reviewed after the grant of a license to site a major energy facility. In this way the applicant can be assured of a prompt review of its final building design without having to commit to final design before a decision regarding the overall Board license. Such a procedure will protect the public, because final construction drawings will be reviewed for building code compliance.

In absence of express legislation the Board believes it has the power under Sec.42-98-7 and Sec.42-98-18 of the Act to establish such a post licensure proceeding by regulation and intends to proceed with the promulgation of such regulations.

b. The Advisory Opinions

i) Burrillville

While it would have been most helpful to the Board to have received a detailed written report from the zoning boards regarding the issues identified in the Preliminary Decision, such reports have not been provided. Instead the Board has considered the actions of the Zoning Boards, as summarized below, as advisory opinions.

The proposed site for the OSP facility is located in an F5, residential-agricultural zone. According to Burrillville Town officials the F5 designation was not intended to limit development in F5 zones to agricultural-residental usage, but simply was a designation for land outside of the developed core areas of the Town. Exhibit OSP 19 at 134; 8/16/88 Tr. 97. Other uses, such as sewage treatment plants and solid waste facilities are allowed by special exception in an F-5 zone. Zoning Ordinance Town of Burrillville, Appendix A, (1988).

William Flanagan, President of the Burrillville Town Council, testified that the Council believed OSP's economic contribution to the Town would be substantial, with little offsetting impact on infrastructure. Town Exhibit 13 at 4. Accordingly, the Town revised its zoning ordinances to allow for construction of the OSP facility.

On December 28, 1987 an electric generating facility was defined as a special exception for an F5 zone by unanimous vote of the Burrillville Town Council. Town Exhibit 2. This was preceded by the Planning Board's recommendation that an electric generating facility be allowed by special exception in F5 zones. Id.

On April 13, 1988 the Town signed a Tax Treaty and Agreement with OSP. Town Exhibit 1. Under the terms of the tax treaty, OSP will make payments in lieu of taxes of 2.5 million to 5 million dollars per year according to a scheduleset out in the agreement. Id. at 2. In addition, OSP has committed to a one-time $200,000 payment to the Town to fund property value relief. OSP Exhibit 8j; Town Exhibit 13 at 9. This fund will be administered by the Town under rules established by the Town for the benefit of property owners whose property values may be adversely impacted by the OSP facility. Finally OSP has agreed to a $100,000 annual payment for approximately 20 years to the Town, $70,000 of which must be used for educational scholarships. Id.

On April 19, 1988, the Burrillville Zoning Board by unanimous vote granted the special exception to site the facility the height variances for the building, exhaust stacks, and cooling towers. Exhibit OSP 19 at 205.

ii) Woonsocket

On December 14, 1987 the Woonsocket Zoning Board of Review by unanimous vote approved a variance for OSP to build a water intake structure on the bank of the Blackstone River in Woonsocket. Exhibit OSP 21. The structure will house pumps that will pump cooling water from the Blackstone River and transmit it via pipeline to the OSP site in Burrillville. The Zoning Board found that the flood plain of the River would not be affected by the structure and stipulated that the variance be subject to Department of Environmental Management regulations.

c. Conclusion

Based on the above actions of the Town of Burrillville and the City of Woonsocket, the Board concludes that the proposed OSP facility will meet the ordinances and requirements of local government. See Preliminary Decision, Issue 4.

IV. SOCIOECONOMIC IMPACT

a. The Issues

Before a license can be issued, the Act requires the Board to find that the proposed facility will "enhance the socio-economic fabric of the state." R.I. Gen. Laws Sec.42-98-11(B) (3). To make such a determination the Board considered three issues: the overall socio-economic impact of the facility on the state, its consistency with the state guide plan, and, because of local concern about traffic impacts, the impact of traffic on the local community during construction and operation. Preliminary Decision, Issues 2, 3 & 10. Consideration of social and economic issues of necessity overlap with environmental considerations, especially as to impacts on the local community. Thus some issues discussed below in this section will be addressed in the following section which addresses environmental impacts.

b. Consistency with State Guide Plan

While the State Planning Council (Council) found that the OSP project is consistent with most elements of the State Guide Plan, OSP Exhibit 4 at 4-6, its placement in, and impact on, a rural-residential area makes it inconsistent with the "general goals, policies, and land use map of the State Land Use Policies and Plan." Id. at 4. The Council, however, found that:

Because of the unique and statewide impact of power generating facilities; this project may be deemed consistent if it can be shown that its probable net negative impact to the natural resources, rural character and future development of the surrounding area, will be appreciably less significant than its positive contribution to the state's economic and energy resources, and that the same positive contribution to the state's economy and energy resources are not feasible in another location.

Id. at 4.

c. Socio-Economic Impact

The Council prepared an advisory opinion, as to socio-economic impact which considered energy, employment, social and economic impacts and which concluded that "the OSP proposal should on balance, be beneficial to the socio-economic fabric of the state." OSP Exhibit No. 4 at 2.

As to energy impacts the Council looked favorably on the proposed site's proximity to transmission lines and the additional generating capacity that would be available to Rhode Islanders. Id.

The employment impact of seventy-five workers during operation and approximately three hundred during construction was viewed favorably by the Council, but was not considered a major impact on Rhode Island, since employees would be drawn from Massachusetts and Connecticut as well as Rhode Island. Id.

Estimated revenues to the Town of $65,000,000 to $75,000,000 over twenty years far exceeded the $760,000 to $960,000 infrastructure cost to the Town over the same period. Id. at 3. In addition the Council found that the State would benefit from corporate and employment related taxes which would generate more benefits than costs to state government.

The Council came to no express conclusion regarding social impacts alone, but noted that the facility would be located on land zoned for residential and farming uses. The Council recommended that a "suitable mechanism should be considered to compensate the [neighboring] landowners." Id.

The Board held two evening public hearings in the Town to allow members of the local community to address the Board with their concerns. The first hearing was scheduled specifically at the request of Concerned Citizens. While this group of neighboring landowners formally intervened, they did not participate in the formal hearings at the Board offices and requested that the Board allow them to state their concerns as members of the public rather than formal intervenors.

A total of thirty-six people testified at the two evening public hearings, although many of the same individuals testified at both hearings. A number of representatives of local and state government testified in support of the project. The majority of individual landowners and representatives of Concerned Citizens opposed the project. The major concerns addressed by these individuals at both hearings focused on OSP's potential impacts on property values, the rural character of the Town and on traffic and noise impacts. Many sought guaranteed compensation for any future decrease in property values. The following will address land use and property value concerns and traffic impacts. Noise impacts will be addressed in the next section which deals with environmental issues.

d. Land Use

The location of the proposed facility in what is currently a residential area, has generated the most controversy in these proceedings. Individual homeowners' concerns about potential impacts on property values have been echoed by the FERC staff and in the comments by EPA as well as the Council. The FERC and neighbors of the proposed OSP facility have suggested that OSP be required to compensate neighboring land owners for adverse economic impacts. EIS at 5-14, 15. OSP proposes to create a $200,000 economic impact fund to be administered by the Town, but opposes mandatory compensation or buyout of neighboring residents.

Because the Board has been created to evaluate both local and statewide impacts of major energy facilities, but has no mandate to maintain economic status quo, the Board questions its authority to require this, or any, Applicant to purchase neighboring residential property or compensate neighboring residents, because of economic impact. Indeed, over the long run, the economic impacts of an energy facility may enhance the value of neighboring property. This is not to say that it would be unwise to purchase neighboring property in this case and the Board supports the creation of a fund to mitigate any adverse economic impacts. But, the major reason the Board will not order mandatory compensation or buyout is that such a solution does not focus on the real problem, i.e. OSP's potential impact on the rural character of the area and future development of the area.

Nor does the Board find the Applicant's position persuasive on this point. OSP claims that the Town's decision to grant a special exception to QSP should end the Board's inquiry regarding land use. The Town's grant of a special exception, however, is advisory only. The Board may accept, reject or modify the opinion. R.I. Gen. Laws Sec.42-98-11 (C).

The Council's advisory opinion, OSP Exhibit 4, identified the key land use issue before the Board, when it found that the project is inconsistent with the State Guide Plan, but may be deemed consistent if statewide benefits exceed local adverse impacts. There are obvious statewide benefits to the project, but since the Board must consider the socio-economic fabric of the entire State, R.I. Gen. Laws Sec.42-98-11(C), the Board must examine the OSP's impact on the rural character and future development of the surrounding area.

At the outset, it is important to note that although the land use in the area near the plant is largely single family residential, this is not the exclusive use in the area. The Blackstone Valley Electric switching station, power lines and natural gas pipelines are located in close proximity to the proposed OSP site. Nor is an F-5 zone in Burrillville exclusively residential or agricultural. Airports, heliports, sawmills and sewage treatment plants, incinerators and solid waste disposal facilities are allowed in F-5 zones by special exception in addition to electric generating facilities. Zoning Ordinance, Town of Burrillville, Appendix A (1988).

OSP's potential negative impacts on rural character and future development can best be mitigated by focusing on the transition area between land uses, i.e. in this case the transition between energy facility and residential land use. Sound planning dictates that there be a transition or buffer area between differing land uses, particularly where the change is abrupt.

The need for a buffer is particularly apparent to the north and south of the proposed site. It is in these areas that residential uses are closest to the proposed facility. To the west of the proposed facility, there is an existing switching station, Blackstone Valley Electric property and an electric transmission line right of way which provide a buffer. To the east, there is a large parcel of Blackstone Valley Electric property which, because of the existence of wetlands, has limited development potential. This land lies between the proposed site and the Rhode Island Black Hut Management area and, if left in its present state as the Board urges, should provide adequate protection for the management area.

It is difficult to quantify the size of a buffer area that will be necessary to mitigate impacts to the north and South of the site and any attempt to quantify such a buffer area is to some extent arbitrary. For certainty, however, some quantity must be specified. To that end, the Board observes that the Applicant, itself, has placed the proposed facility approximately 300 feet from its property line when it was able to do so, i.e. on the easterly side of OSP property. Even a 300 foot vegetated buffer between the energy facility and the less intense residential use would serve to lessen the opportunity to change neighboring land use to commercial and industrial and therefore would serve to maintain the rural character of the area.

The Board has authority to issue a license "on any condition the Board deems warranted by the record." R.I. Gen. Laws Sec.42-98-11(C). We conclude that a 300 foot buffer area is consistent with sound planning principles, with the enhancement of the socio-economic fabric of the State, with mitigation of unacceptable harm to the environment and is within the broad mandate of the Board's authority under the Act. We will, thus, require the Applicant to maintain approximately a 300-foot buffer between the operational part of the site and neighboring land uses. The boundary of the operational part of the site shall be the fence line enclosing the facilities. OSP Exhibit DR-9. If OSP does not currently own sufficient property to maintain a 300-foot buffer, as may be the case to the north and south of the site, OSP shall offer to purchase conservation easements or full title to property to establish such a permanent buffer zone and ensure that no future development takes place.

We recognize that, without condemnation powers, OSP may not be able to purchase such easements. Accordingly, we will only require that OSP make a good faith effort to acquire such property interest, where necessary, by making a timely offer to purchase appropriate title or easements at fair market value. Such offers need not be of indefinite duration and may be withdrawn, if unaccepted, one year after the date of this decision.

As suggested by the EIS and as agreed to by the Applicant, the Board will also require that a buffer zone be maintained between the facility and the family cemetery and Crow Hollow area at the Sherman Farm Road site. EIS at 5-15.

e. Traffic

The project is consistent with the transportation elements of the State Guide Plan, OSP Exhibit 4 at 5, but neighboring landowners have expressed concern about truck traffic during construction and, in particular, in the event that the gas supply is interrupted and pipeline oil supplies must be supplemented by truck delivery.

An oil pipeline will be extended to the site and, if the gas supply is totally interrupted, the pipeline will be able to supply on a continuous basis approximately thirty percent of the fuel requirements for both units over a ten day period. 9/1/88 Tr. 32. Six days fuel supply will be stored in tanks on site. Id. at 28. But if both generating units are to operate at full capacity while burning only oil, the pipeline oil supply will have to be supplemented by approximately one hundred truckloads of oil per day. EIS at 2-86, 87. It is the one hundred truckload per day projection that has caused most concern.

The need for oil truck deliveries to the site, however, is unlikely. OSP will have a twenty year contract for gas supply and if the gas supply is interrupted, because of accident or sabotage of the gas pipeline, economic considerations dictate that major efforts will be made to repair the line quickly.

The same economic considerations, along with environmental requirements, make it unlikely that the facility will operate for long periods with oil for a fuel. If the facility is burning oil, the economics of the NEPOOL Power Dispatching System are such that the plant would be dispatched as a "peaking" unit which would generate only during times of peak demand or twenty to thirty percent of the time. 9/1/88 Tr. 30. With gas as a fuel the units will be dispatched as base load units which will generate continuously. The air quality permit which must be obtained from DEM will have, if issued, emission limits that will effectively limit oil burning to about sixty days per year at full capacity. 9/1/88 Tr. 33. Finally, any impact caused by oil truck deliveries can be mitigated by dividing such traffic among the three approaches to the site, Aldrich Street, Sherman Farm Road and Douglas Pike.

Since the likelihood of continuous oil truck deliveries to the site is so remote, additional consideration of potential impacts from oil truck traffic is unnecessary.

Traffic during construction may cause temporary impacts. However, the majority of construction will take place during normal working hours, will not be different from the traffic associated with any other large construction project and will end after the construction is completed.

Traffic during operation of the site should not be a problem, since only approximately thirty-five staff will be present on site at any one time. OSP Exhibit 25 at 9. Thus we conclude that the foreseeable traffic impacts do not present an obstacle to granting a license for the facility. See Preliminary Decision, Issue 10.

f. Conclusion

We conclude that the statewide socio-economic impact of the proposed facility is substantially greater than the costs that will be incurred as a result of the facility. While there may be impacts on the rural character and future development of the Town, the Town has voluntarily submitted to those impacts and the required buffer area will mitigate such impacts. The extent of any impact on neighboring individuals is unknown, but the $200,000 fund established voluntarily by OSP will provide some relief if impacts are adverse.

Because we find below that the impact of the facility on natural resources is acceptable, to the extent that the Board has jurisdiction over such impacts, and that other alternative sites have been considered and rejected, we conclude that the project may be deemed consistent with the state guide plan. Id., Issue 3. We further find that the proposed facility will enhance the socio-economic fabric of the state. Id., Issue 2.

V. ENVIRONMENTAL

a. Board's Responsibility

The Board has the obligation to assure that the siting of any major energy facility will "produce the fewest possible adverse effects on the quality of the state's environment; most particularly, its land and its wildlife resources; the health and safety of its citizens, the purity of its air and water; its aquatic and marine life, and its aesthetic and recreational value to the public." R.I. Gen. Laws Sec.42-98-2(C). Before a Board license can be issued, the Board must make an express finding that "the proposed facility will not cause unacceptable harm to the environment." Id. at Sec.42-98-11 (B) (3).

At the outset of hearings regarding this application, the Board concluded that an overall environmental assessment of the proposed energy facility was needed. The Board's initial comments are worth restating:

An EIS is essential to the Board's deliberations. While the Board does not have jurisdiction over major environmental permits, e.g. permits required under the Clean Air Act, state policy requires that a major energy facility 'produce the fewest possible adverse effects on the quality of the state's environment' and the Board must implement that policy in its final decision. Thus, we conclude that the Board has both the responsibility and power to evaluate all individual and cumulative environmental impacts of the proposed facility before arriving at a final decision regarding the OSP application. Preparation of an EIS is the most efficient way of identifying those impacts for board review.

Preliminary Decision at 6.

The Applicant in this matter prepared a comprehensive and formidable environmental review of the estimated impacts of the proposed facilities and updated this review during the course of the hearings. This information has provided the foundation of the Board's review. There is, however, a need to analyze such information carefully and critically. The Board continues to believe that the best way in which to analyze environmental data is by the preparation of such data by an independent entity or, at a minimum, review of such data by an independent entity. The EIS prepared by the FERC and the advisory opinion prepared by DEM has immeasurably assisted the Board in its review of environmental data.

As will be shown below, the Board has relied on OSP information for the foundation environmental data and has used the EIS and DEM advisory opinion to critically evaluate this information. Comments by the public, Audubon, the Environmental Protection Agency (EPA) and the U.S. Fish and Wildlife Service (Fish and Wildlife) have likewise been used to evaluate critically these data and advisory opinions.

In the instant case, air, wetland, and major water permits are exempt from the Board's jurisdiction. R.I. Gen. Laws Sec.42-98-7(A). This has complicated the Board's review. Since the Board is under a strict statutory time frame to evaluate an application and render a decision, the Board has been unable to wait until major environmental permits have been finally issued or denied. Thus the Board's final decision has been rendered on the best available environmental data and is, of course, contingent upon the Applicant obtaining necessary permits from DEM.

Coastal Resources Management Council (CRMC) permits are also exempt from the Board's jurisdiction, id., but the CRMC determined that it would not take any action regarding the OSP application.

b. Potential Impacts

i) Water Quality

Cooling for both units of the OSP facility will require approximately 4.4 million gallons per day (mgd) of water. OSP initially indicated that cooling water would be obtained from the Scituate Reservoir via a pipeline that would extend from North Providence to Burrillville. See Generally OSP Exhibit 1A. Hence, the Board's designation of the Rhode Island Water Resources Board as an agency that would render an advisory opinion regarding the use of the Scituate Reservoir. OSP's later decision to utilize the Blackstone River as the exclusive source of water eliminated the need for a Water Resources Board advisory opinion.

DEM has independent authority over the two major water quality permits, the "401" permit for withdrawal of water from the Blackstone River and the permit for the onsite wastewater clarification system. As to the latter permit, DEM states that additional information must be submitted before a decision can be made regarding the wastewater clarification system. DEM Exhibit 1 at 10. Such information will probably not be available until the Board renders its decision, since it is unlikely that the Applicant will proceed with final design of the wastewater clarification system until the decision on a Board license has been made. Thus, the Board is unable to comment further on this particular aspect of the application, other than to conclude that no information has been submitted to question the feasibility of such system and the ability of OSP to design a system satisfactory to DEM.

Discharge of cooling water should not be a problem, since the facility has been designed as a closed-loop system, i.e. cooling water will be recycled and, in the event of plant failure, there is adequate capacity to impound cooling water on site. A potential problem could arise if the closed loop system failed such that continual operation of the plant would require a discharge of cooling water. Since the Applicant has not made provision for a water discharge, a license must be conditioned on plant shutdown in the event the closed loop cooling system fails.

Withdrawal of approximately 4.4 mgd of river water gives rise to the major environmental problem associated with the OSP facility and the Applicant presented studies regarding potential impacts on metals concentrations, aquatic life and dissolved oxygen (DO) levels in the river. A study addressing DO mitigation measures was also presented.

OSP's biological survey of the Blackstone River concluded that only minor reduction of down stream habitat would result from the withdrawal of cooling water and that, since fish populations in the immediate vicinity of the proposed intake structure are low, withdrawal of cooling water would have minimum impact on fish populations in the Blackstone River. OSP Exhibit 17 at 4-3, 4.

The metals study focused on two flow scenarios, 7Q10 and 1Q10. The 7Q10 scenario estimates the lowest weekly flow expected in ten years, is a commonly used low flow parameter and was the basis for evaluation of chronic toxicity impacts. According to OSP "water quality modeling and aquatic toxicity testing demonstrate that there will be only insignificant 'di minimus' impacts on the water quality of the Blackstone River as a result of the proposed withdrawal." OSP Exhibit 18 at v.

Potential impact on DO presents more significant problems. Under 7Q10 flow conditions, river flow will be approximately 102 CFS. OSP Exhibit 16 at 2-16. The minimum dissolved oxygen content set by present DEM water quality criterion is 5.0 milligrams per liter. OSP concludes that under most scenarios the withdrawal of cooling water will not lower the DO level in the river below 5.0 milligrams per liter and in extreme cases the withdrawal impact will be less than 0.3 milligrams per liter. Id. at 2; OSP Exhibit 8(f) at 20-23.

DEM by its July 19, 1988 Water Quality Certification Agreement with OSP has required OSP to implement DO mitigation measures whenever the cooling water withdrawal impact is greater than 0.5 milligrams per liter or when DO in the river is below 6 milligrams per liter. OSP Exhibit 31. The need for DO modification will be based on a matrix developed by DEM. Id. at Exhibit A.

OSP has developed an extensive list of alternatives to mitigate any impact on DO concentrations. The potential alternatives would increase aeration of river water by diversion of water over the Thundermist Dam, additional aeration at the Woonsocket Waste Water Treatment Plant by mechanical or passive means and aeration of the Blackstone River itself. OSP Exhibit 8(f) at 20-23.

While the DEM agreement deals with DO concentrations, it does not address other potential impacts, particularly impacts which might occur when river flow falls below the 7Q10 level. The FERC, EPA and Fish and Wildlife have expressed such concerns. FERC concludes that although the withdrawal of cooling water will have minimal impact on 7Q10, 102 CFS river flows, the 4.4 MGD withdrawal would constitute over 32% of the much lower minimum daily flow recorded on the river in Woonsocket. EIS at 4-7. EPA's comments on the final EIS have expressed concern about metals concentrations, aquatic habitat and the cumulative impact of this project with other "reasonably foreseeable proposals for water withdrawals from the Blackstone". Audubon Exhibit 4 at 2. Fish and Wildlife has expressed similar concerns. Audubon Exhibit 5. All three agencies recommend that OSP develop a backup water supply or be prohibited from withdrawing water when the river reaches a low flow of 7Q10 (i.e. 102 CFS) (FERC & EPA) or 208 CFS (Fish & Wildlife).

The Water Quality Certification Agreement does not end our inquiry into the potential impacts on the Blackstone River. While impacts at the low flow, 7Q10 level may be acceptable for short periods of time, there is, of course, no guarantee that river flow will not decrease below the 7Q10 level. Historic data has shown that at times the river flow dips well below the 7Q10 level and we do not accept the proposition that OSP should be allowed to withdraw water at low flow periods even if such periods coincide with an intense regional need for power. Thus, we conclude that a withdrawal of water should be conditioned on adequate river flow.

We note that the problem of water supply during periods of low river flows is one of the Applicant's own making. Suggestions have been made throughout these hearings that the Applicant obtain a backup water supply to utilize during periods of low river flow, but no alternative supplies have been suggested by the Applicant.

Practicality requires that a numerical limit be established to indicate when water withdrawal must terminate. Any such limit is to some extent arbitrary. Fish and Wildlife has suggested a 208 CFS level, however, we find no justification in the record for the 208 CFS level. In contrast, the 102 CFS 7Q10 level suggested by EPA and FERC is a commonly used low flow parameter which would indicate that the river is being stressed. We find that the 102 CFS 7Q10 level is the appropriate trigger for limitation on water withdrawal and prescribe the following limitations. If river flow at the proposed intake structure or the nearest gauging station in Woonsocket falls below 102 CFS for 24 hours, the Applicant will have 12 hours to take action to mitigate its impact on the river flow. If after an additional 12 hours (or 36 hours total) the river flow is still below 102 CFS, the Applicant shall reduce its water intake by 50% until such time that the river flow reaches 102 CFS. If after an additional 12 hours (or 48 hours in total) the river flow is still below 102 CFS, the Applicant will immediately cease all water withdrawal until the river flow is above 102 CFS.

To insure proper monitoring, the Applicant shall install a continuous real time flow gauge in the Blackstone River at or near the proposed intake structure to monitor river flow or shall make arrangements to use any existing continuous real time flow gauge located near the proposed intake structure. The data from such guage shall be continuously telemetered to OSP and DEM, if DEM so requests, and shall be made available to the public and state and federal government agencies.

We thus conclude that, conditioned on OSP's compliance with the DO limits and mitigation actions prescribed by DEM and the withdrawal limits ordered by the Board, water can be supplied to the proposed facility without unacceptable adverse impacts. See Preliminary Decision, Issue 7. We note that the above restriction on water withdrawal addresses DEM's concerns about alternative cooling systems and backup water supply. DEM Exhibit 1 at 23.

ii) Air

OSP must obtain a Prevention of Significant Deterioration (PSD) permit from DEM for the discharge of air emissions. The PSD permit is exempt from Board jurisdiction. R.I. Gen. Laws Sec.42-98-7(A). OSP submitted extensive environmental data regarding air emissions in its initial application, OSP Exhibit 1A, and subsequently submitted its entire PSD permit application. OSP Exhibit 10.

The principal emissions from the OSP facility will be nitrogen oxides and carbon monoxide. EIS at 4-20. Much lower levels of volatile organic compounds and particulate matter will also be emitted. Id. Oil burning, if this back-up fuel must be used, will increase the emission levels for nitrogen oxides, carbon monoxides and volatile organic compounds and will also produce significant levels of sulfur dioxide. Id. DEM, however, will restrict oil burnng operation under the PSD permit to 1300 hours or 54 days per unit. DEM Exhibit 1 at 18. Thus air emissions associated with oil burning will have significant limits.

The OSP facility will obviously have an impact on air quality, but the EIS has concluded that emissions will be below National Ambient Air Quality Standards:

"all predicted concentrations are well below the ambient standards, and there is no reason to expect that any standard would be threatened or exceeded at any location as a result of the operation of the OSP facility."

EIS at 4-24.

The only controversy regarding air emissions is the selection of the best available control technology which is a requirement of the PSD permit and which is entirely within DEM jurisdiction. While the selection of control technology may affect the economics of the OSP facility, the Board is unable to consider this impact since its decision must be issued before the DEM will issue its final permit in November 1988. DEM Exhibit 1 at 6. The information now before the Board shows that the OSP facility will comply with air quality standards and based on this information, the Board concludes that the OSP facility will comply with state and federal air quality standards.

iii) Noise

Along with water quality concerns, the concern about noise impacts caused the most controversy in these hearings. Audubon, FERC staff, DEM and numerous residents expressed great concern about construction noise levels and, in particular, operational noise levels. Forty-five to fifty residences may be impacted by noise from the operation of the facility. The nearest residence is located 1200 feet from the site and approximately fifteen other existing residences are located between 1200 and 2000 feet of the proposed site. Another thirty to thirty-five residences are located within 3000 feet of the site. OSP Exhibit 8(c) at 16, 23.

There are no Rhode Island regulations or guidelines regarding the regulation of noise. FERC recommends that the day/night sound level at the nearest residence be limited to 55 dbA.[3 "dbA" is a weighted measure of sound intensity and frequency and is used to measure sound impacts on the human ear. EIS at E-2.] EIS at 4-40. Massachusetts does not have noise regulations, but has established guidelines which limit noise impacts to 10 dbA above existing background ambient sound levels. Id.

The Applicant conducted the only noise studies at the site and there is some inconsistency between the two studies conducted by the Applicant. One study showed equivalent sound levels[4 Equivalent sound levels represent the weighted average sound energy over a specific time period. For a constant source of noise the instantaneous sound level is the same as the equivalent sound level. The day/night sound level is the weighted average sound level over 24 hours with additional weighting to reflect the quieter evening hours. EIS at E-2; OSP Exhibit 8c at 19.] as low as 29 to 33 dbA with an average equivalent sound level of 36 to 41 dbA. Id. Another study by the Applicant showed equivalent sound levels of 44 to 45 dbA and a day/night sound level of 48 to 49 dbA. OSP Exhibit 8(c) at 29. The EIS concludes that projected operational sound levels at the nearest residences in Massachusetts would nearly meet the Massachusett's guidelines during quiet hours and would comply with the guidelines in all other periods. EIS at 4-41. At the closest residence in Rhode Island the projected sound level would exceed the Massachusett's guidelines by 6 to 10 dbA. Id.

At the next to last hearing day on September 1, 1988, OSP offered to guarantee an equivalent sound level of 43 dbA at the nearest residential property, 9/1/88 Tr. 16, which is a four dbA improvement over initial projections. OSP Exhibit 8c at 23. (Equivalent sound levels and day/night sound levels were initially projected at 47 and 53 dbA respectively at the nearest residence. Id. at 28.) OSP has a guarantee from the equipment supplier of an equivalent sound level of 55 dbA at its property line, but OSP will design for 50 dbA at the property line and spend an additional $2 million dollars to attenuate noise. 9/1/88 Tr. 15, 16; OSP Exhibit DR-15. If an equivalent sound level of 43 dbA is exceeded at an existing residence occupied by current residents, OSP will offer to purchase the property at fair market value. Id.

We believe that the OSP proposal to in effect guarantee no more than an equivalent 43 dbA sound level at the nearest residence provides substantial protection to neighboring property owners. The corresponding day/night sound level will be below the FERC recommended 55 dbA level and will substantially comply with the Massachusett's guidelines, even though these guidelines have not been adopted by Rhode Island.

A protocol will have to be developed to particularize the method of measurement and the measurement time period. OSP should undertake to develop such a protocol in cooperation with the Town and the neighboring residents. If an impasse develops over development of the protocol, the matter can be referred to the Board for final resolution.

iv) Wetlands

Construction activity at the Sherman Farm Road site will result in the clearing of approximately 20 acres and the filling of about one-half acre of wetland area. OSP Exhibit 1A at 4-15; EIS at 4-43. The EIS concludes that the wetland area is too small to fall under DEM jurisdiction, id., and although DEM has not yet issued a wetlands permit, it anticipated in its advisory opinion that OSP would be able to conform with the requirements of the Rhode Island Wetlands Act. DEM Exhibit 1 at 7.

As to the oil and water pipeline construction, DEM concludes that locating these pipelines along existing highway rights-of-way will result in insignificant alterations to wetlands. Id. at 6. For this reason, DEM has opposed the FERC recommendation that the oil and water pipelines be located in off-road easements.

The DEM advisory opinion is consistent with the FERC's conclusion that alterations to wetlands will be insignificant. Even the EPA and Fish and Wildlife do not disagree with the FERC conclusion, although both argue that another site should be chosen for the OSP facility, in part because of wetland impacts. Both the EPA and Fish and Wildlife base their objections to the Sherman Farm Road site on their conclusions that better alternative sites exist, not on significant impacts on wetland areas at the Sherman Farm Road site. Audubon Exhibit 4 at 3; Audubon Exhibit 5 at 8.

Although wetland regulation is exempt from the Board's jurisdiction, R.I. Gen. Laws Sec.42-98-7(A), our review of the record indicates that wetlands impacts at the Sherman Farm Road site and along the oil and water pipeline will be insignificant, if the pipelines are located along existing highway rights-of-way.

v) Cooling Tower Emissions

The Applicant introduced three studies regarding the potential impacts from the two cooling towers: Potential Impacts of Cooling Tower Emissions on Vegetation and Wildlife, Human Health Risk Assessment Associated with Ocean State Power Cooling Tower Emissions, and Cooling Tower Environmental Impact Assessment. OSP Exhibits 10 (d), (e) and (h). All studies concluded that cooling tower emission impacts on vegetation, human health and road safety would be minimal. The EIS concurred. EIS at 4-27, 4-44 to 46.

Audubon presented Dr. Keith Killingbeck, a plant ecologist, who made three "observations" regarding the studies, but did not contradict the ultimate conclusions reached by the studies and the EIS. Dr. Killingbeck argued only that more study was required.

The only evidence before the Board overwhelmingly shows that any impacts associated with cooling tower emissions will be minimal, if detectable at all. We disagree that additional studies regarding cooling tower emissions are necessary before a Board license can be issued. This matter has been adequately examined.

vi) Visual

The one hundred fifty foot emission stacks, the forty-three foot cooling towers and the sixty foot main building structure will, of course, be visible from the surronding area. This impact is unavoidable and will occur at any site. The Applicant should make every effort to preserve the existing forest for a visual buffer and enhance this buffer where possible. Maintenance and enhancement of the three hundred foot buffer will be a specific requirement of the Board license.

vii) Air Cooling

EPA, Fish and Wildlife, DEM and Audubon have urged that OSP reduce or eliminate its need for Blackstone River water by using air cooling instead of water cooling. Evidence regarding the potential use of air cooling shows that such use would increase the size of the facility, be noisier, reduce the available energy output and increase project costs. 9/2/88 Tr. 9.

The use of air cooling has been proposed primarily to eliminate impacts on the Blackstone River and to obviate concern about potential malfunctions of the zero discharge cooling system. By our decision to limit water withdrawal during periods of low flows we have addressed the concern about impacts on the Blackstone River. Since we have required the facility to shut down if the zero discharge cooling system fails, we have addressed concerns about potential water discharges from the site, itself. Since these requirements address the concerns raised about water cooling and since air cooling will cause other environmental impacts, there is no need to require air cooling or further studies.

viii) Down Stream Hydro-power Generators

Withdrawal of water from the Blackstone River during periods of low flow could potentially have an impact on downstream hydro-electric generators by reducing the amount of water available for generation. No evidence was submitted regarding the potential for and extent of such an impact, but OSP agreed to compensate any downstream hydro-electric generator for losses resulting from OSP's withdrawal of cooling water. 9/1/88 Tr. 85.

ix) Non-exempt Permits

While the majority of DEM permits are exempt from Board review, DEM permits issued for fuel oil storage, oil spill prevention and countermeasure plans and individual sewage disposal systems fall under Board authority. Preliminary Decision at 14. At the time the DEM advisory opinion was submitted in August 1988, the substance of OSP's application for fuel oil storage and the spill prevention and countermeasure plan had been reviewed and approved by DEM. DEM Exhibit 1 at 4. Only the designation of individuals for notification purposes remained to be completed before DEM recommended final approval. Id.

An opinion regarding an individual sewage disposal system became unnecessary, when OSP decided that the on-site waste water clarification system would treat sanitary waste from the facility. Id.

x) Oil and Water Pipelines

A six inch oil pipeline and water pipeline will carry cooling water and oil for backup fuel to the site. Both pipelines will be constructed in the same trench for the majority of their routing and the route plan proposed by OSP will confine the pipelines to the shoulder of Victory Highway, Douglas Pike and West Ironstone Road for the majority of the pipelines' length. OSP Exhibit 1A at Fig. 2-6. The water pipeline will also have to traverse Woonsocket city streets. The Town has required that the oil pipeline be double-walled for its entire length within the Town to prevent possible groundwater contamination resulting from potential leakage. OSP Exhibit 19 at 203-204.

FERC has concluded that "to the extent technically and environmentally feasible" OSP should reroute the oil and water pipelines along Providence and Worcester Railroad spur lines, an abandoned rail line and along an existing 345 kilovolt (kv) transmission line so as to avoid impacts during construction on neighboring residents. EIS at 5-14 and 2-110. DEM disagrees and recommends that, due to the increased impact on wetland areas, if the pipelines are located outside highway rights-of-way, the pipelines should be constructed in highway rights-of-way. DEM Exhibit 1 at 20. The Department of Transportation in its June 1988 advisory opinion indicates that an acceptably designed pipeline can be constructed in state highway rights-of-way, provided that design and construction standards are met. Nor did the location of the pipelines present any controversy during the hearings on this application.

We agree with DEM that the Applicant's proposed routing is preferable to the FERC proposed routing. We do not believe that the EIS adequately addresses wetlands impacts associated with the rerouting of the oil and water pipelines. Any impact on neighboring residents, a concern noted in the EIS, will be temporary in nature, while impacts on wetlands due to construction disturbance have the potential to be permanent. We will thus approve the Applicant's proposed routing of the oil and water pipelines. OSP Exhibit 1A at Fig. 2-6.

OSP has argued to the Board that double-walled pipeline for the entire length through the Town of Burrillville is unnecessary. The only necessity should be protection where the pipeline traverses groundwater aquifers. We agree and will require that the oil pipeline be double-walled only in such areas.

C. Conclusion

Based on economic considerations and the limits of the air emissions permit which OSP must obtain, the Board concludes that it is unlikely that oil will be burned by the OSP facility for any extended time period and that the burning of oil will not cause unacceptable adverse impacts. See Preliminary Decision, Issue 8. Based on the above review of state permits that are required by DEM and that would be required by other agencies absent Board jurisdiction, the Board concludes that the OSP facility will meet the requirements of state laws, rules and regulations and will not, indirectly or directly, cause unacceptable harm to the environment. Id., Issues 4, 5.

VI ALTERNATIVE SITES

In the initial application the Applicant identified three geographic areas located in western Massachusetts, eastern Massachusetts and northwest Rhode Island and one specific site, the Buck Hill site in northwestern Rhode Island, as potential alternative sites for its facility. OSP Exhibit 1A at 5-9. The FERC alternative site analysis was far more comprehensive. It began with 82 possible sites, identified by FERC staff, interested parties, and the Applicant, EIS at 2-97, and ended with the identification and comparison of two primary alternative sites, the Bryant College site and the Ironstone site, with the Applicant's proposed Sherman Farm Road site. Id. at 128. The Board did not undertake an independent search for alternative sites. See Preliminary Decision at 10.

The Applicant's analysis and rejection of its alternative Buck Hill site was based entirely on the Sherman Farm Road site's ownership and accessibility to gas and electric transmission lines. The western and eastern Massachusetts regions were rejected because of difficulties with connecting to the bulk electric transmission grid. OSP Exhibit 1A at 5-10. The Buck Hill site, which is also located in Burrillville, was rejected because it did not have an electric transmission substation on site and, because the land is owned by Algonquin Gas Transmission Company, which is not involved in the OSP project and indeed is a competitor of Tenneco. The EIS considered the Buck Hill site, but ranked it below the Bryant College and Ironstone sites. EIS at 2-124 to 129.

The Bryant College site is located in Smithfield, Rhode Island, southeast of the Sherman Farm Road site. Oil, water and gas supply pipelines for this site would be similar to those planned for the Sherman Farm Road site. A new electric transmission switching station, however, would have to be constructed to allow the interconnection of a generating facility with the bulk power grid. Location at this site would have less impact on neighboring residents even though the nearest residents are approximately 1200 feet from the site. EIS at 2-128.

The Ironstone site is located in Uxbridge, Massachusetts to the east of the Sherman Farm Road site near the Rhode Island border. This site would have to be rezoned for electric generation usage. Water, gas and oil supply lines would be similar to those designed for the Sherman Farm Road site, but water supply would be complicated if water from the Blackstone River in Rhode Island was pumped to the Massachusetts site, since a Rhode Island permit to take water out of Rhode Island would be needed. As with the Bryant College site, a new switching station would have to be constructed to allow interconnection with the bulk power grid.

The EIS concludes that the Sherman Farm Road, Bryant College and Ironstone site "are all considered to be feasible for the development of the proposed power plant and ancillary facilities." Id. at 2-147. FERC concludes that the greatest environmental impact would occur at the Bryant College site, but that the impact on neighboring residences would be less at the Bryant College and Ironstone sites than at the Sherman Farm Road site. FERC concludes that the Ironstone site is the most favorable followed by the Sherman Farm Road site and the Bryant College site. Id. at 2-148.

EPA and members of the public, have urged the Board to consider the Ironstone site as the preferable site for the OSP facility. The Chairman of the Uxbridge Board of Selectmen has urged that the Board consider new alternatives and that OSP begin discussions with Uxbridge representatives about the use of the Ironstone site. 8/16/88 Tr. 46. The Board, however, has no jurisdiction over a Massachusetts site and we find the the Uxbridge Chairman's comment disingenuous. The comment came on the last day of public testimony in spite of the fact that OSP's application and its intent to construct at the Sherman Farm Road has been well publicized for at least two years. Nor has the Town of Uxbridge rezoned the site for industrial usage or expressed interest in locating the OSP facility in Uxbridge. Thus, the Board is hard-pressed to seriously consider Uxbridge's belated request that the Board require, even if the Board had authority to do so, further discussion regarding the Ironstone site.

Audubon has urged, through the testimony of Dr. Oliker, that the Bryant College site is preferable, because of the possibility of piping hot water to Providence for urban district heating. Audubon Exhibit 1. Use of excess heat for urban district heating is an admirable goal, but the possible transport of hot water from Smithfield to Providence is far too speculative to be considered realistic in 1988 or the foreseeable future.

There is no statutory requirement to find the best possible location for a major energy facility. Indeed, within the context of an adjudicatory hearing on a specific application to the Board, it is impossible to require siting at the best possible alternative site, if such an alternative can be realistically identified, since the Board has the duty under the Act to fairly and in a timely manner respond to all applications. The designation of a best possible site or a ranking of possible sites must be left to the planning process required by Section 2(A) of the Act. The Board's responsibility regarding this application, similar to the analysis conducted by the FERC in the EIS, is to determine whether the proposed siting of a major energy facility is acceptable or whether there is a major factor which must prohibit the use of the particular site for that energy facility.

As to the OSP facility, we find, as did the FERC, that the Sherman Farm Road site is a reasonable and acceptable location for a major energy facility. See Preliminary Decision, Issue 11. Its primary drawback is the proximity of the site to neighboring residences and its potential impact on the rural character and development of the Town. The mitigation measures described below will lessen these impacts and, as stated above, the statewide benefits of such a facility far outweigh the local impacts. While alternative sites may exist that appear, absent detailed analysis, to be equally acceptable, the existence of such sites, even in Rhode Island where the Board has jurisdiction, does not provide a basis to reject the Sherman Farm Road site.

VII MITIGATION/CONDITIONS

Based on the above discussion, the Board will place the following conditions on the siting and construction of the OSP facility:

1) If the flow in the Blackstone River at the cooling water intake structure or the nearest gauging station in Woonsocket falls below 102 CFS for a 24 hour period, the Applicant shall take action to mitigate its impact on the river flow. If after another 12 hours (36 hours total) the flow remains below 102 CFS, the Applicant shall reduce its cooling water withdrawal by 50% until such time that the flow in the river reaches 102 CFS. If after an additional 12 hours (48 hours total) the flow in the Blackstone River remains below 102 CFS, the Applicant shall cease its cooling water withdrawal until such time that the flow in the river reaches 102 CFS.

2) A real time flow gauge must be installed in the Blackstone River at or near the proposed location of the intake structure. Flow gauge readings must be continuously telemetered to OSP and, if requested to DEM, and made available for inspection by state and federal agency personnel and the public.

3) There shall be compliance with all DEM requirements regarding dissolved oxygen mitigation measures.

4) If the waste water clarification system or any part of the zero discharge water system fails, the facility must be shut down until such time that the zero discharge system becomes functional.

5) Should noise levels at any existing residence, occupied by current residents, exceed 43 dbA, equivalent noise level, the Applicant shall offer to purchase that residential property at fair market value. The Applicant shall develop a protocol in consultation with the Town and neighboring residents which will particularize the method of measurement and the measurement time period.

6) A buffer of approximately 300 feet from the fence line enclosing the operational part of the site shall be maintained. If 300 feet extends beyond OSP's property line, OSP shall offer to purchase a conservation easement or the title to property to maintain a 300 foot buffer. OSP shall maintain the buffer area in its natural forested state and shall enhance the existing vegetation with plant species selected to maximize visual screening and noise attenuation.

7) The oil pipeline shall be constructed with double walls within the limits of any groundwater aquifer zone.

8) The following pipeline construction requirements shall be observed:

i) pipeline construction work will be performed under the direction of a registered professional engineer.

ii) any work which damages roadway shoulders will require replacement of the entire shoulder.

iii) roadway pavement repair will be in accord with Rhode Island Department of Transportation specifications and directions.

iv) any pavement markings which are lost as a result of pipeline construction work will be replaced in kind.

v) the details of bridge crossings must have prior approval of the Rhode Island Department of Transportation.

9) A buffer zone shall be maintained between construction work and the family cemetery and Crow Hollow area on the OSP property.

10) Except where necessary to avoid unreasonable delay, episodic noise events, such as blasting and steam blowdowns, shall be scheduled and notice shall be given so as to cause minimal interference with neighboring residental and business activities.

11) To the extent possible construction traffic approaching the site shall be confined to Sherman Farm Road.

12) Architectural plans for the pumphouse at the Blackstone River shall be reviewed with the Blackstone Valley National Heritage Corridor Commission and the DEM Divison of Planning and Development.

13) Construction activities shall be confined to normal working hours so as to cause minimal interference with neighboring residental and business activities unless work outside normal hours is necessay to avoid unreasonable delay.

14) The Applicant shall apply for and obtain all state and local building and construction permits which would be required absent the Board's review of this project.

15) The Applicant shall provide DEM with all necessary designation of individuals and other required information regarding the oil spill prevention and countermeasure plan.

While the Board can issue cease and desist orders and conduct show cause hearings when evidence of non-compliance is presented, EFSB Board Rule of Practice and Procedure No. 1.14 (b), the Board has no permanent staff and no current means of monitoring compliance with the above conditions. The authority to enforce compliance is an empty vessel, unless regular monitoring occurs during construction. To ensure compliance with these conditions, the Board intends to hire a qualified engineer or construction manager, independent of the Applicant, to monitor compliance with the terms of this Decision and Order for the Board. Such engineer or construction manager will be staff of the Board for the purposes of this application and the expenses associated with the engineer or construction manager shall be borne by the Applicant. R.I. Gen. Laws Sec.42-98-17 (B). Therefore as a final condition of the Board license:

16) The Applicant shall pay for all costs incurred by the Board to retain an engineer or construction manager to monitor the Applicant's compliance with the conditions of this Board license during construction.

VIII. CONCLUSION

The Board finds that there is a regional and state need for the electric energy that OSP will produce, that such electric energy is cost-justified and will be produced at the lowest reasonable cost, that the facility will comply with all laws, regulations and ordinances, that the project will enhance the socio-economic fabric of the state and that the enviromental impacts of the project are acceptable. Thus subject to the conditions set out above, the Board grants a license to site and construct the two 250 MW generation units described in the OSP application.

This Board license constitutes approval of:

(i) a fuel oil storage permit and a spill prevention and countermeasure plan which, absent the Board's jurisdiction, would be under Department of Enviromental Management's jurisdiction,

(ii) a special exception for the siting of the OSP facility in Burrillville and height variances for the OSP building and emission stacks, which, absent the Board's jurisdiction, would be under the Burrillville Zoning Board of Review's jurisdiction, and

(iii) a variance for the siting of the pumphouse and intake structure in Woonsocket, which absent the Board's jurisdiction, would be under the Woonsocket Zoning Board of Review's jurisdiction.

This Board license does not approve and the Applicant must still obtain when necessary:

(i) Rhode Island Department of Transportation utility and construction permits for the design and construction of oil and water pipelines,

(ii) Woonsocket Office of Building Inspector and Department of Public Works building and construction permits for the design and construction of water intake and pumphouse structures and oil and water pipelines,

(iii) Burrillville Office of Building Inspector building and construction permits for the design and construction of the OSP structures and oil and water pipelines,

(iv) all other necessary state and local building and construction permits and

(v) all necessary DEM permits.

The Applicant may apply to the Board for approval of any of the above building and construction permits if the appropriate local or state authority does not issue such a required permit in a timely manner, improperly refuses to issue such a permit or places improper or unnecessary conditions on the grant of such a permit.

Accordingly it is hereby

(7) ORDERED:

Ocean State Power is granted a license to site and construct two 250 MW combined cycle generating units at the Sherman Farm Road site in Burrillville, Rhode Island together with appurtenant facilities and oil and water pipelines in Burrillville and Woonsocket, Rhode Island, as described in its January 13, 1987 application as modified during the hearings, and subject to the following conditions:

1) If the flow in the Blackstone River at the cooling water intake structure or the nearest gauging station in Woonsocket falls below 102 CFS for a 24 hour period, the Applicant shall take action to mitigate its impact on the river flow. If after another 12 hours (36 hours total) the flow remains below 102 CFS, the Applicant shall reduce its cooling water withdrawal by 50% until such time that the flow in the river reaches 102 CFS. If after an additional 12 hours (48 hours total) the flow in the Blackstone River remains below 102 CFS, the Applicant shall cease its cooling water withdrawal until such time that the flow in the river reaches 102 CFS.

2) A real time flow gauge must be installed in the Blackstone River at or near the proposed location of the intake structure. Flow gauge readings must be continuously telemetered to Ocean State Power and, if requested, to the Department of Environmental Management and shall be made available for inspection by state and federal agency personnel and the public.

3) There shall be compliance with all Department of Environmental Management requirements regarding dissolved oxygen mitigation measures.

4) If the waste water clarification system or any part of the zero discharge water system fails, the facility must be shut down until such time that the zero discharge system becomes functional.

5) Should noise levels at any existing residence, occupied by current residents, exceed 43 dbA, equivalent noise level, Ocean State Power shall offer to purchase that residential property at fair market value. Ocean State Power shall develop a protocol, in consultation with the Town of Burrillville and the neighboring residents, to particularize the method of measurement and the measurement time period.

6) A buffer of approximately 300 feet from the fence line enclosing the operational part of the site shall be maintained. If 300 feet extends beyond its property line, Ocean State Power shall offer to purchase a conservation easement or the title to property to maintain a 300 foot buffer. Ocean State Power shall make every effort to maintain the buffer area in its natural forested state and shall enhance the existing vegetation with plant species selected to maximize visual screening and noise attenuation.

7) The oil pipeline shall be constructed with double walls within the limits of any groundwater aquifer zone.

8) The following pipeline construction requirements shall be observed:

i) pipeline construction work will be performed under the direction of a registered professional engineer.

ii) any work which damages roadway shoulders will require replacement of the entire shoulder.

iii) roadway pavement repair will be in accord with Rhode Island Department of Transportation specifications and directions.

iv) any pavement markings which are lost as a result of pipeline construction work will be replaced in kind.

v) the details of bridge crossings must have prior approval of the Rhode Island Department of Transportation.

9) A buffer zone shall be maintained between construction work and the family cemetery and Crow Hollow area on the OSP property.

10) Except where necessary to avoid unreasonable delay, episodic noise events, such as blasting and steam blowdowns shall be scheduled and notice shall be given so as to cause minimal interference with neighboring residental and business activities.

11) To the extent possible construction traffic approaching the site shall be confined to Sherman Farm Road.

12) Architectural plans for the pumphouse at the Blackstone River shall be reviewed with the Blackstone Valley National Heritage Corridor Commission and the Department of Environmental Management Divison of Planning and Development.

13) Construction activities shall be confined to normal working hours so as to cause minimal interference with neighboring residental and business activities unless work outside normal working hours is necessary to avoid unreasonable delay.

14) Ocean State Power shall apply for and obtain all state and local building and construction permits which would be required absent the Board's review of this project.

15) Ocean State Power shall provide to the Department of Environmental Management all necessary designation of individuals and other required information regarding the oil spill prevention and countermeasure plan.

16) Ocean State Power shall pay for all costs incurred by the Energy Facilities Siting Board to retain an engineer or construction manager to monitor the Ocean State Power's compliance with the conditions of this Energy Facilities Siting Board license during construction.

DATED AND EFFECTIVE AT PROVIDENCE, RHODE ISLAND THIS 25th DAY OF OCTOBER, 1988.

Mary N. Kilmarx

Chairperson

Daniel W. Varin

Associate Director of Administration for Planning

Robert L. Bendick, Jr.

Director, Department of Environmental Management

0180m

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