LUZ ENGINEERING COMPANY (LUZ) VIOLATED SEVERAL NEW SOURCE PERFORMANCE STANDARDS (NSPS) REQUIREMENTS INCLUDING FAILURE TO INSTALL CONTINOUS EMISSION MONITORING SYSTEMS (CEMS), FAILURE TO PROVIDE PROPER NOTIFICATION OF TESTING, FAILURE TO PROVIDE NOTIFICATION OF COMMENCEMENT OF CONSTRUCTION AND START-UP, AND FAILURE TO CONDUCT PROPER TESTING AT LUZ'S SOLAR ENERGY GENERATION STATIONS (SEGS) II - V. THE VIO- LATION (FOV) TO LUZ DATED NOVEMBER 10, 1987. THE FOV LISTED THE VIOLATIONS OF THE NSPS REGULATIONS THAT OCCURRED AT SEGS II. LUZ REQUESTED NEGOTIATIONS TO RESOLVE THE DISPUTE IN ORDER TO SECURE FINANCING FOR A NEW UNIT. NEGOTIATIONS BEGAN IN DECEMBER 1987. EPA AND LUZ HAVE ENTERED INTO A LETTER AGREEMENT (ATTACH- MENT A) PROPOSING RESOLUTION OF MANY OF THE VIOLATIONS. THE LETTER AGREEMENT WAS SIGNED BY EPA REGION 9, BUT WAS APPROVED BEFOREHAND BY STAFF AT EPA OFFICE OF ENFORCEMENT AND COMPLIANCE MONITORING. THE DEPARTMENT OF JUSTICE WAS KEPT INFORMED OF THE NEGOTIATIONS. UNDER THE AGREEMENT LUZ AND EPA HAVE 180 DAYS FROM FEBRUARY 24, 1988 TO REACH AGREEMENT ON A CONSENT DECREE TO RESOLVE THE CASE. IF AN AGREEMENT IS NOT REACHED BY THE DEADLINES (ROUGHLY AUGUST 24, 1988), THE COMPLAINT SHOULD BE FILED.