Pending wastewater discharge permits for Pacific Gas & Electric?s Diablo Canyon nuclear plant and Duke Energy?s Morro Bay project were sent back to the drawing board because they may not meet new federal rules. Early this week, the Central Coast Regional Water Quality Board canceled its April 2 hearing on Duke?s draft permit. The board announced that the controversial permits for Duke and PG&E—required by the federal Clean Water Act—would be overhauled to comply with the U.S. Environmental Protection Agency?s new rules requiring water-cooled plants to significantly reduce the harm to aquatic resources (see <i>Energy Circuit<\/i>, Feb. 20, 2004). Dynegy and NRG were asked by the California Energy Commission to take a second look at mitigation technologies for the water-cooled El Segundo project in Santa Monica Bay. ?We need to reconsider the permits to see if they meet the new standards,? said Michael Thomas, environmental engineer with the Central Coast water board. The EPA released overhauled Clean Water Act regulations for power plants with existing intakes February 17. The complex 400-page rule is chock full of ?caveats, ifs, and options? and ?we don?t know if the permits are in line with the [new] language,? Thomas said. ?We recognize that it is an important issue,? said Pat Mullen, Duke spokesperson. A decision on the national pollutant discharge permit has been put off by the regional board before. The energy commission has said repeatedly it won?t vote on the 1,200 MW replacement facility?s certification until the water board issues a permit. PG&E was accused of violating its wastewater discharge permit, and a settlement has been in the works for a few years. The water board rejected the tentative deal, telling its staff to evaluate the benefits of what were deemed habitat-friendly projects included in the proposal. ?Now we will have to look at how the new rules affect the proposed settlement,? Thomas said. PG&E spokesperson Jeff Lewis said the utility was reviewing the new rule, adding it includes ?exceptions and accommodates studies that have been previously done.? NRG?s El Segundo plant has a wastewater discharge permit and is in the final stages of certification at the energy commission. On February 23, ?the commission asked us to engage in a review of mitigation technologies to see if there are greater mitigation measures we can undertake,? said Jesus Arrendondo, NRG director of regulatory and governmental affairs. The new EPA rules require that the destruction to marine life be mitigated between 60 percent and 90 percent in accordance with yet unknown site-specific performance standards. A key issue will be the baseline used to measure cost-effective mitigation. Until recently, the EPA had advised water boards not to apply the draft rules to permits in the works but to follow the guidance set out in the Clean Water Act rules from the 1970s because the fate of the updated rules was uncertain.