RE: Variance Request #2 - Allow for a two-spread construction scenario for the SFPP Carson to Norwalk Pipeline Project.

Dear Mr. Cornman:

We have reviewed the above-referenced variance request, and approve your request based on the following factors:

• The purpose of Variance Request #2 is to expedite project completion and reduce the potential for construction activities to disrupt local jurisdictions beyond July 1, 1999. Kinder Morgan Energy Partners (KMEP) anticipates that the one-spread scenario (as considered in the FEIR) could not complete project construction by this date, and as a result, construction would be extended until September 1999 or later.

• As part of Variance Request #2, the daily and quarterly construction emissions were recalculated for the project in consideration of the additional mainline construction spread. In doing so, KMEP revised the construction assumptions used in the FEIR (i.e., number and types of construction equipment, operating hours per day, operating usage factors for equipment) to reflect a better understanding of the actual equipment needed and construction schedule developed for this requested change. These refinements were developed in consultation with the Applicant’s construction contractor. Table 1 (attached) provides the incremental increase or decrease in emission levels associated with the refined equipment and schedule needs.

• Based on the revised analysis performed, the project air quality impacts remain significant (as evaluated in the FEIR) for daily and quarterly NOx, as well as daily PM₁₀ emissions. However, as presented in the FEIR and summarized in Table 1 (attached), PM₁₀ emissions would be reduced to an insignificant level with the implementation of required measures (listed in the FEIR and below), whereas NOx emissions would remain significant even with mitigation, both under the one- and two-spread scenarios. However, the daily and quarterly NOx emissions would be reduced by 36% and 17%, respectively, under the two-spread scenario which is based on more accurate construction equipment and scheduling requirements.

• The daily CO emission levels would change from non-significant to significant under the two-spread scenario. However, the Applicant has proposed additional mitigation (above what is required by the FEIR) to reduce this impact to an insignificant level. Proposed mitigation includes the purchase of sufficient Emission Reduction Credits (ERCs) and spacing of construction spreads (see complete mitigation measures below). CO ERCs would be obtained from a local source near the pipeline route. These ERCs would be secured prior to start-up of the second construction spread.

• The measures noted below shall be implemented:

- All applicable mitigation measures shall be implemented during construction.

- As proposed, construction spreads shall be located no closer than 2 miles in distance to reduce the potential localized air quality impacts from cumulative PM₁₀ and CO emission levels created from two construction spreads operating adjacent to each other.

- In order to further reduce any potential impacts from fugitive PM₁₀ emissions during material haul trips, the contractor shall lightly spray (no runoff shall be allowed) the top of the spoil material in each truck before covering the loaded truck and exiting the project site for disposal.

- As proposed, in order to reduce the amount of fugitive PM₁₀ emissions generated during trenching operations (or material handling operations), the contractor shall restrict (to the extent feasible) the trench width to a maximum width of 30 inches.

- As proposed, the Applicant shall offset the incremental increase in CO emissions by purchasing ERCs from local emission sources. The Applicant shall purchase ERCs in the amount that is equivalent to the incremental increase in emissions that are above the SCAQMD’s CO significance threshold (550 lbs/day). Verification of the ERC purchase shall be conducted by CPUC prior to the start-up of the second construction spread. No sale of ERCs shall occur during the duration of project construction.

- Implementation of this variance in accordance with the provisions noted above shall be verified on a random basis by a CPUC Environmental Monitor.

Sincerely,

Moises Chavez

Project Manager

cc: V. Strong, Aspen

      S. Lee, Aspen