Air Quality Minor Source Permitting Multi-State Comparison · 2021. 5. 10. · Will Backus ♦...

Air Quality Minor Source Permitting Multi-State Comparison Dallas, TX ♦ December 3, 2013

Will Backus ♦ Consultant Wbackus@trinityconsultants.com

Presentation Outline • Introduction to Minor Source Permitting • Methods and Assumptions • State Specific Requirements • Permitting Options Comparison • Timeline to Construct Comparison • Conclusions

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Introduction (1 of 3) – Comparison Overview

• Air quality minor permits can vary significantly by state • Scope: Eleven state air quality minor source permitting

programs were compared using multiple metrics for upstream Oil and Gas (O&G) facilities

• Goal: Evaluate the differing state permitting programs for streamlining and efficiency opportunities for industry

Introduction (2 of 3) – Minor Permits • Through the Clean Air Act (CAA) and EPA, authority for permitting O&G minor

sources is delegated to the states – State New Source Review (NSR) Permits are contained in the State Implementation Plan (SIP)

for projects which do not trigger major (federal) NSR review • Minor NSR permits apply to:

– Any new, relocated, modified, or reactivated source that is not otherwise exempt; or – Source emission increase greater than a certain threshold – Other factors including:

• Potential impact on nonattainment areas • Sources subject to any NSPS or NESHAP federal rule • Sources desiring a limit on “potential to emit”

• Generally, sources required to obtain a permit must do so prior to commencement of construction, modification, or operation

Introduction (3 of 3) – Goal of Air Permitting

• Balance protection of the environment and human health with jobs-producing economic development

• Ensure that the public has an opportunity to – Be informed of important government actions – Comment/participate/influence in the important

areas • Do so thoughtfully and cost- and time-efficiently

States Included in Review

StateOil

Production Rank (2012)

Gas Production

Rank (2011)Texas 1 1North Dakota 2 18Oklahoma 5 4New Mexico 6 7Louisiana 7 2Wyoming 8 3Colorado 9 5Montana 12 21Ohio 18 20Pennsylvannia 19 6West Virginia 22 10

Assumptions (1 of 2)

• Focus on upstream, specifically production facilities

• Onshore facility • Facility emissions

typically range from <10 tpy to ~40 tpy for criteria pollutants

Picture Source: npr.org

Assumptions (2 of 2)

• Typical Emission Sources at Production Facilities: – Compressor Engines – Storage Tanks – Pneumatic Controllers – Dehydrators – Flares – Equipment Leaks – Truck Loading

Methods • Analysis metrics evaluated include:

– Construction & Operation Permitting Options

– Exemptions and De Minimis Thresholds

– Timeline to Construct – State O&G Rules and Requirements – Dispersion Modeling Requirements – Public Notice Requirements

Common Permitting Pathways (1 of 6)

• There were 5 common permitting pathways that were analyzed: – Source and De Minimis Exemptions – Registration/ Notification – Permit by Rule (PBR) – General Permit (GP) – Source Specific State Minor Permit to Construct (PTC)/

Permit to Operate (PTO)

Common Permitting Pathways (2 of 6)

• Source and De Minimis Exemptions – O&G minor source production facilities may be

categorically exempt or may fall below state De Minimis permitting thresholds

– Recommended that Facility document their exempt status, and in some cases, report exempt status to state authority

– Careful! Many state level exemptions may go away (especially considering emissions reported by the industry on January 13, 2014, states may seriously re-think exemptions)

Common Permitting Pathways (3 of 6)

• Registration / Notification – One time submittal to the state agency – Registration programs allows a source to acknowledge

that it will comply with all federal and state requirements

• Must submit a short application prior to or following start-up – Cheapest “permitting” option due to short agency

processing times

Common Permitting Pathways (4 of 6)

• Permit by Rule (PBR) – Facilities that will not make a significant contribution of air contaminants to

the atmosphere if operated or constructed with certain restrictions – Adopted by a state when there are a sufficient number of facilities with very

similar operations, emissions, and activities that are subject to the same standards, limitations, and operating and monitoring requirements

– Functions in place of a permit to construct so long as a source meets qualifying criteria, including emission limitations, conditions for operation and requirements for recordkeeping and reporting

– Does not expire as long as the air pollution source continually meets all of the qualifying criteria

Common Permitting Pathways (5 of 6)

• General Permit (GP) – GP are similar to PBRs

• GPs are developed to streamline the permitting process for similar facilities

– Difference between GP and PBR • Recordkeeping and reporting requirements are lengthier for GP • A permit is issued which typically acts as both the construction

and operation permit • Source construction may commence upon receipt of the permit

application

Common Permitting Pathways (6 of 6)

˃ Source Specific State Minor Permit to Construct (PTC) / Permit to Operate (PTO) – Source specific state minor New Source Review (NSR)

permits require full-blown permit application • Typically, generalized permit forms or streamlined

requirements are not included – Source/Facility construction may only commence once

permit is in hand

State-Specific Permitting Overview

Picture Source: CNBC.com

When Considering Permitting Thresholds…

• When determining emissions, you may take “credit” for emission reductions using a vapor recovery unit (VRU) or other device if it is inherent to the process

• Watch out! Each state varies in what is considered an “inherent process”

Texas • Multiple permitting pathways • Permit application is dependent on

geography – Inside Barnett Shale vs. Outside the

Barnett Shale • PBR Thresholds:

– 250 tpy CO or NOX – 25 tpy VOC, SO2, or PM – 15 tpy PM10 – 10 tpy PM2.5

• Case-by-case permits for those that don’t meet Non-Rule Standard Permit or Standard Permit qualifying criteria

Texas – Barnett Shale Permitting • PBR

– Must submit pre-construction notification – Must submit application 90 – 180 days after operation

depending on level of emissions • Non-Rule Standard Permit (SP)

– Must submit pre-construction notification through STEERS (online e-permitting system)

– Must submit application 90 days after operation – Application is almost identical to PBR – BACT

Texas – Outside Barnett Shale Permitting

• PBR – Use individual PBRs for engines, flares, other O&G equipment – Sites can voluntarily submit Barnett Shale PBR application

• Standard Permit – Sites can voluntarily submit Barnett Shale Non-Rule Standard

Permit – Must evaluate additional emission limitations on speciated

VOCs for all units except those using natural gas (i.e., engines, heaters)

Colorado • Standard NSR permits and emission reporting have source-specific

thresholds for attainment and non-attainment areas • Source-specific General Permits, including:

– GP01 for Storage tanks less than 40 tpy VOC – GP02 for RICE with less than 40 tpy NOX – GP07 for truck load out (proposed) – GP08 for condensate, crude oil and produced water; threshold linked

to NSPS OOOO (proposed) • Permit in hand prior to construction • Significant rulemaking proposed in February 2014 will affect

permitting of oil and gas sources

Ohio • GP12 Finalized in February 2012. Notable

qualifying criteria: – Tank size thresholds – Toxic pollutant emission thresholds – HP restrictions on RICE – All RICE must meet NSPS JJJJ/NSPS IIII

requirements (even grandfathered engines) • BAT analysis required for every emission

unit regardless of permit type or PTE • Ohio EPA implemented expanded pre-

permit construction allowances for minor permits in 2006, allowing installation all the way up to final tie-ins

Pennsylvania • Exemption 38: Blanket exemption for drilling

phase/production sites replaced with a conditional exemption in 2013 – Limits on VOC emissions; control requirements – Annual Leak Detection and Repair (LDAR) provisions

• GP5 for Gas Production Facilities which do not fall within under the exemption qualifying criteria

• Best Available Technology (BAT) Requirements

West Virginia • Construction permit required:

– 6 lb/hr or 10 tpy of any regulated air pollutant; or – 144 lb/day any regulated air pollutant; or – 5 tpy aggregated HAP; or – State toxic air pollutant thresholds tripped; or – Subject to NSPS or NESHAP

• G-70A for Natural Gas Wells released in October 2013 • BAT requirements

Louisiana • Standard Oil and Gas Permit

– No longer issued – Existing standard permits are being converted to MSOG or site-specific minor source permit

• Minor Source Oil and Gas Permit (MSOG) – Questionnaire must be filled out to determine applicability; Emission thresholds including:

• 15 tpy PM10 • 20 tpy VOC

– Must convert to site-specific if no longer qualify for MSOG – Allows for facility modifications with notice if modified facility still covered under MSOG

• Site Specific Minor Source Permit – Regular LA minor source permit must be obtained if conditions of MSOG are not met – Not as flexible on modifications as MSOG

• Regulatory Permit for Emergency Engines – Current proposed rule to extend the regulatory permit to all engines – Must eventually be included in permit, but allows for quick approval for site-specific minor source permits and

Title V permits

New Mexico

NOINo Permit Part 72 NSR PSD

<10 tpy

10-25 tpy

>25 tpy>10 lb/hr

NSPS, NESHAP

100/250 tpy

• Notice of Intent (NOI) for sources less than 25 tpy criteria (100 tpy VOC)

• Construction permit application for sources greater than 25 tpy criteria (no construction permit required for VOC sources less than 100 tpy)

• General Construction Permits (GCPs) or New Source Review Permits

Oklahoma • Three oil and gas permitting alternatives exist

beyond a site-specific permit – General Permit for Oil & Gas Facilities – General Permit for Area Source & Small NSPS – Permit by Rule for Oil & Gas Facilities

Oklahoma – GP for Oil & Gas Facilities • Actual and PTE (after control) < “Major” • Notice of Intent (NOI) to Construct

– Forms to describe equipment and emissions – Site diagram/ map – DEQ letter authorization via permit # 2013-xxxx-NOI

• NOI to Operate – Describe any changes from NOI to Construct – DEQ issues permit # 2013-xxxx-0

• Notice of Modification for any changes • Quarterly engine emissions test • Covers all Federal Subparts

Oklahoma – General Permit for Area & Small NSPS

• Actual < 40 TPY and PTE (before control) < “Major” • Notice of Intent (NOI) to Construct

– Forms to describe equipment and emissions – Site diagram / map – DEQ letter authorization via Permit # 2013-xxxx-NOI

• Notice of Intent (NOI) to Operate – Describe any changes from NOI to Construct – DEQ issues Permit # 2013-xxxx-O

• Notice of Modification for any changes • NO quarterly engine emissions test • Covers all Federal Subparts

Oklahoma – New PBR for Oil & Gas • Can cover all Federal NSPS and NESHAP Subparts • Allows taking limits to avoid NSPS or NESHAP requirements

(e.g., can certify <6 tpy VOC for a storage tank to not be subject to NSPS Subpart OOOO)

• PBR Registration Specifics: – NO Notice of modification for changes – NO emission calculations (but keep records) – NO plot plan, map, or flow diagram – NO quarterly engine emissions test – Reduced emission inventory schedule (every 3 or 6 years)

Wyoming • Allows for startup or modification of upstream O&G facilities prior to

permitting provided certain emission control requirements are met. Does not apply to other facilities, where permit must be in hand.

• Presumptive Best Available Control Technology (PBACT) for new wellsites for tanks, dehydration units, pneumatics, and engines; standards are region specific (depending on basin) – PBACT requirements and guidance first published in 1999 – Sites with known emissions must obtain a pre-construction permit

• A complete permit application or waiver application must be filed within 60-90 days of date of first production (DOFP) depending on location; no de minimis thresholds.

• Waivers: – For small/insignificant sources of emissions (small engines, pumps, production

sites with low total emissions)

Montana • Any project which has the potential to emit more than 25 tpy of any

pollutant must obtain an air quality permit prior to construction • Registration program for production facilities (adopted in 2006)

– Registration application must be submitted no later than 60 days after DOFP

– PBACT including VOC control requirements for any unit with a potential to emit of 15 tpy or more; avoided prescriptive control requirements to allow flexibility in control options

– LDAR and additional recordkeeping requirements

North Dakota • State and Industry worked together to create Bakken-

specific guidance in May 2011 – Objective is to help ensure production facilities comply

with VOC emission regulations – Perform emission calculations, and within 60 days, install

additional controls as required – Submit a registration packet within 90 days of the DOFP – Registration package includes one form, gas analysis, and

summary pages for the North Dakota Department of Health Guidance Workbook

Summary of Alternative Permitting Pathways

Timeline to Construct • Important variable in any project involving air

permitting – Trinity examined possible permitting pathways for

O&G production facilities in each state in the study – Relied on previous Trinity permitting experience in

each state – The Timeline to Construct was plotted for every state

based on the two most likely permitting pathways in that state

Timeline to Construct

Reg.

PBR (Option1)

Exempt

Reg.

GP

Reg.

PBR

Waiver

GP

GP

GP

GP (Option 2)

GP

PTC

PTC

GP

GP

PTC

PTC

PTC

PTC

0 30 60 90 120 150 180 210

ND

OK

PA

MT

LA

NM

TX

WY

WV

OH

CO

Timeline to Construct based on Permit Options

Permit Option 2 (Days) Permit Option 1 (Days)

Permit Application Requirements: Modeling

• Modeling is typically a rare requirement since many upstream facilities are largely VOC emissions only

• Two most common pathways to dispersion modeling at production facilities are:

– Emergency generator emissions – Toxics modeling (H2S)

• TX: SCREEN3 modeling for engines (NO2) • OH: Significant Emission Rates (SERs) including

for toxics • CO, NM may require modeling for NSR permit

applications • WY may require modeling on larger case-by-

case projects

Permit Application Requirements: State BAT or BACT

• Best Available (Control) Technology Requirements can be an added step in the permitting process, or may be a presumptive step in order to begin well production

• BAT: Found in WV, PA, OH rules • Presumption BACT (PBACT): Found in

WY, MT, ND

Permit Application Requirements: Public Notice

• For permitting actions that trigger public review, a 30 day review and comment period is typical

• States in review where public notice is typically required for O&G production facilities include: • WV, OH, NM, LA

Conclusions (1 of 2)

• Many states are adopting streamlined permitting approaches for O&G production facilities in response to increased O&G production and federal requirements – Many states are in the process or will likely update rules in response to NSPS

OOOO/ NESHAP HH/HHH • Well registration programs combine sufficient guidelines with an industry

friendly permitting process • Regional similarities (EPA Regions/ Basin Regions)

– WY, MT, ND (Region 8) require PBACT and well registration or a waiver/permit application

– PA, WV (Region 3), OH (Region 5) require BAT and have General Permits for production facilities

– NM, TX, OK, LA (Region 6) do not show as many major similarities • However, Permit by Rule and General Permits are the norm

Conclusions (2 of 2)

• Tier 1 – “High likelihood of a quick permitting process, registration, or exemption”

• Tier 2 – “In many cases a production facility will fall under a streamlined permit’s qualifying criteria”

• Tier 3 – “Higher likelihood of full permit application along with less construction allowances prior to receiving permit”

Further Research Topics • Update state permitting comparison after

responses to NSPS OOOO • Include other O&G upstream facility types

(compressing, gathering, etc.) • Include permitting information on additional

states (CA, AK, etc.)

Questions?