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5/18/2006
U.S. Environmental Protection Agency
Comments on APGI Agreement in Principle (dated May 5, 2006)
A) Proiect Reservoir Operations - Reservoir Operating Guides, High Rock
Proposal: APGI proposes to pass through the guide curve as needed to maintain downstream
minimum flows or as provided under the LIP or HPMEP. Whenever the reservoir water levels
falls below the guide, APGI will reduce its generation at High Rock to the daily average flow
equivalent of the minimum flow requirement at Falls plus up to 25%.
Comments: Reservoir levels should be established as compliance minimums. The only
excursion below these levels should come as a result of initiation of the LIP or HPMEP
situations. Does the OASIS modeling show instances where it is necessary to drawdown lake
levels to meet minimum flows in situations other than an LIP or HPMEP? Unless this is
demonstrated, EPA does not support this proposal. If APGI needs a "buffer" to allow for
operational flexibility, EPA recommends that APGI establish "target" lake levels higher than
4/10 for High Rock Lake, with the ability to draw down to 4/10, as necessary to meet
downstream flows.
B) Proiect Instream Flows - Minimum Flow
Proposal: APGI proposes to file the Flow Monitoring Plan within 24 months of the effective
date of the new license.
Comments: EPA recommends filing of the Flow Monitoring Plan within 12 months with FERC
and DWQ. Obviously, APGI has a number of "plans" to file with FERC and other agencies after
the new license is issued. It appears that most are scheduled to be filed within 24 months. EPA
recommends acceleration of the filing of the Flow Monitoring Plan and DO Monitoring Plan (see
comments below), given the magnitude of current violations of water quality standards below the
dams.
D) Water Quality - Tailwater Dissolved Oxyi!en Improvement Measures
Proposal: APGI proposes to determine whether additional DO enhancement measures are
needed to further improve DO conditions in the Falls and Tuckertown tailwaters after installation
of aeration technology is completed at Narrows and High Rock, and after DO conditions in the
tailwaters have been monitored and studied for a period of two years.
Comments: EPA has concerns over the current proposal because it does not include
commitments to complete DO enhancement measures at Tuckertown and Falls. The overall
improvement schedule should include contingency timeframes for making additional station
modifications at Tuckertown and Falls if the proposed improvements at High Rock and Narrows
or operations protocols are not successful in meeting water quality standards below the dams. It
would seem advantageous to build these contingencies into the new license, as opposed to
relying on securing improvements via reopener clauses and potential license amendments.
D) Water Ouality - Water Quality Operations
Proposal/Comments: 2nd sentence, EPA recommends deleting "endeavor to" to read, "(as
described above), APGI will operate the refurbished/upgraded units..." EPA also has concerns
about the last sentence in this section, "Generally it is anticipated that the period of aeration
operations will begin no later than May 1 of each year and will continue through November 30
of each year, unless tailwater DO monitoring indicates that water temperatures and DO
conditions are such that no aeration is required." It is unclear what is meant by the last phrase in
t
5/18/2006
this sentence. Low DO events do not necessarily occur in isolation; rather, during warm summer
months, DO may sink below the standard for a short period (hours or days), rise back above
briefly, decline again, and so on. In this instance, monitoring would show that tailrace
discharges are above the standard, only to fall back below at some point in the future. It is
unclear how the hydro operators will be able to react to such a dynamic condition without better
definition of the linkage between the continuous monitoring results and the operations protocol.
This should be qualitatively addressed in the AIP or RSA, with greater clarity occurring in the
401 certification application or the DO Monitoring Plan.
D) Water Ouality - Dissolved Oxygen Monitoring Plan and Reports
Proposal: APGI proposes to file the Flow Monitoring Plan within 12 months of the effective
date of the new license.
Comments: EPA recommends acceleration of the filing of the DO Monitoring Plan within 6
months with FERC and DWQ. Development and submittal of this plan should be one of the first
priorities under the new license, given the magnitude of current violations of water quality
standards below the dams. In addition, it is anticipated that much of the information needed to
complete this plan will be included in the 401 certification application to the State of NC, which
would seem to make it easier to file this plan more quickly.
Attachment 4 - Yadkin Proiect Proposed Unit Refurbishment/Upmde and DO
Enhancement Schedule
Comments: As mentioned in our comments on the DLA, EPA is very interested in ensuring an
expedited improvement schedule that includes completion of DO enhancements at High Rock
and Narrows by 2011 (instead of 2012, as currently proposed). Here are a number of comments
to address this issue, based on the timeline proposed in Attachment 4:
1) Is it possible to expedite the schedule for improvement to Narrows Unit #2, which is
already approved under the existing license? Completion in CY 2007 or earlier in CY
2008 would hopefully allow for initiation of refurbishment of Unit #1 in 2008 after the
new license is issued, with the ability to expedite the subsequent schedule for future
improvements. At a minimum, can the improvement schedules be timed to complete
construction in the summer, instead of at the end of the year, to allow for testing of the
unit's aeration effectiveness during the same low DO period (late summer/early fall).
This would also allow for earlier completion of some of the effectiveness testing.
2) Based on the current schedule, what is precluding APGI from operating both Units 2 and
4 during the Summer of 2008 (if Unit 2 is scheduled for completion by 3/31/08)? EPA
recommends including a commitment to operate these two units starting in 2008.
3) EPA recommends initiation of the High Rock improvements in 2009 to allow for
completion by 2011. Expedition of the Narrows improvements should allow for earlier
initiation of the improvements at High Rock. Based on the results of the studies
conducted to-date, it appears that achieving standards below Tuckertown could be
problematic, relying exclusively on aeration at High Rock. This places more emphasis
on completing the work at High Rock sooner so any needed improvements at Tuckertown
do not extend unnecessarily in the distant future.
4) EPA recommends shortening the time-frame proposed to develop the DO enhancement
action plan. It shouldn't require a year to develop an action plan for DO enhancement at
either Falls or Tuckertown
i
Major Settlement Points for Alcoa FERC Relicensing
1. Reservoir Operating Guide Curves
a. Contention centered on High Rock proposal of 4'/10'; other reservoirs
acceptable.
b. Lake levels related to daily average discharges, and LIP or HPMEP
requirements.
c. LIP (attempts to match low inflow conditions to outflow by restricting
generation releases and lake level drawdowns) and HPMEP conditions
agreeable to all.
d. Seasonal component considers reservoir stabilization for fish spawning
e. Seasonal component allows H.R. to continue to operate as storage.
2. Instream (Downstream) Flows
a. Flows agreed upon by all including Progress, SC DNR and DHEC.
b. Flow naturalization period from Feb. - May to enhance downstream fish
spawning agreed upon by all.
3. Water Quality
a. Tailwater DO improvement schedule not yet agreed upon by DWQ.
b. DO monitoring plan and reporting will be written into 401 and will not
likely pose issues for DWQ.
c. QAPP not yet developed, but they are reported to be compiling it for
submittal prior to 401 submittal.
4. Recreation Plan
a. 1400 acres to be made available for purchase to State for Morrow
Mountain S.P. expansion.
b. Lots of additional recreation facility improvements and access points in
addition to the historic 26 public recreation sites operated and
maintained by Alcoa. These new sites to be taken on by county, muni or
WRC.
c. Still talking w/ DENR and USFS on additional acres on H.R. inflow and
Uwharrie Nation Forest expansion; also potential rail line conveyance.
5. Shoreline Management Plan
a. New SMP aligns more with state buffer rules related to exemptions and
allowable uses, but still very strong; same 100' width requirement;
applies to all reservoirs.
b. Continues no private access on Tuckertown and Blewett Falls.
6. Fish Passage, Invasive Species and RTE Species Protection Plans
a. Alcoa working on these plans with USFWS and WRC, DWR and NHP.
7. License Term - will define this based on negotiations outcome.

8. Sedimentation/Flooding Mitigation
a. Added this from May 5 version - commiting to paying into mitigation
fund for Salisbury of amount to be determined. Fund can be used for
flood-proofing, facility relocation, sediment removal, etc. Will pay
"amount equal to the present value of the cost of implementing the
Mitigation".
b. Salisbury not likely to accept this offer.
9. TMDL Process
a. Although not stated specifically in the AIP, Alcoa committed $50K total
or $25K/two year study to support DWQ's TMDL development.
City of Salisbury Issues - Flooding, Sedimentation, land donation, water rights, lake
level data. In my opinion, Alcoa has tried to address each of these, but Salisbury
will likely say they fell way too short.

Major Settlement Points for
Progress Energy FERC Relicensing
1. Filed Draft License Application in November 2005 - DWQ filed
comments. Final license application will require additional review.
2. January 2006 - Progress met with DWQ to present DO Enhancement
Program Update. DWQ provided comments in writing in February. PE
agreed to address most comments. Revised plan not submitted to DWQ
and no further specific discussions on this plan.
3. March - minimum flows determined per DWR and mitigation needs
identified. DWR, Progress and John worked this up.
4. April - PE agrees with instantaneous flows and downstream stakeholders
are satisfied; this led to agreement with Alcoa on flows and helped define
the remaining issues on Alcoa agreement. Other issues agreed upon.
Secretary Ross pushed Progress management on additional lands and
conditions.
5. May 17 revision of Comprehensive Agreement Trial Balloon - DWQ filed
comments on continuous monitoring component. Progress agreed to alter
trial balloon to reflect concerns.
6. Progress developed a turbine venting and enhancement plan and
submitted to DWQ for comments. DWQ still needs to review and
comment.
7. QAPP was submitted over two years ago. What is status of review?
8. Other state and federal agencies are generally satisfied with the trial
balloon.

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Duke Power - FERC Relicensing Update
Process Updates
• Agreement in Principle (AIP) was signed in April. DWQ indicated a support
level of 3 in a scale of 1-5. 3 indicates we have (relatively) minor concerns,
but generally support the AIP
• Final Agreement (FA) is being drafted for distribution in June and signature
(Sec. Ross) on 8-1-06.
• Duke filed a Draft License Application (DLA) with FERC in April. DWQ
provided minimal comments because most of our interests were negotiated in
the AIP development process. The AIP will become part of Duke's Final
License Application (FLA). C. ,xr
• Duke intends to start the 401 process in 2007, after FERC gives OK.
w
Negotiation Products
• Water Quality Enhacements
o Assurance DO standards will be met at all hydrostations - Retrofit or
operational changes.
o Water Quality Monitoring Program
o Substantial Conservation Easements
o Cash for conservation.
• Improved flows for Aquatic life and recreation.
o Substantially higher minimum flow requirements
o Restored flows to several bypass reaches.
o Fishing and Boating flows
• Water User Support - (municipal)
o Conservation Fund
o Low Inflow Protocol
• Drought Management Advisory Council
• More stable lake levels, optimized for fish habitat and recreation uses
• Public Information System
• Cultural Preservation
• Public Recreation Facilities in almost every county
• T&E species protection plans
• Shoreline Management Plan
Outstanding Issues
• Flow and Water Quality Implementation Plan
• Water Quality Compliance Plan & QAPP
• Model refinements.
• Conservation Easement Language - Public access (Ross)
• Public dissatisfaction with mitigation package. Some reject out-of-kind
mitigation.