Regulatory Update New Source Review Permitting Case Studies & Regulatory Updates August 26, 2009 ARIPPA Technical Symposium trinityconsultants.com

Regulatory Update

New Source Review Permitting Case Studies & Regulatory Updates

August 26, 2009ARIPPA Technical Symposium

trinityconsultants.com

Agenda PM2.5 NSR

Review of PM2.5 NAAQS and key elements of the Final PM2.5 NSR Rule

Update on Condensables Measurement

Three Case Studies in Permitting PM2.5 Projects

CAIR Update Proposed NO2 NAAQS Revision

© 2009, Trinity Consultants, All rights reserved.

PM2.5 Particles

“Primary” particles: Emitted directly into the air as a solid or

liquid particle Examples: elemental carbon from diesel

engines or fire activities, condensable organic particles from gasoline engines

“Secondary” particles: Form in the atmosphere as a result various

chemical reactions involving gas phase precursors

PM2.5 Precursors: SO2, NOx, VOCs and ammonia.


PM2.5 NAAQS Annual average: 15 μg/m3

3-yr average of annual mean, averaged spatially

Remand issued by U.S. Court of Appeals in Feb. 2009

24-hour average: 35 μg/m3* 3-yr average of 98th percentile at

each monitor

* 24-Hours Standard was originally 65 ug/m3 (in 1997) – revised standard promulgated on 12/18/06.


PM2.5 Nonattainment in Pennsylvania (1997 Standard)


Region 3 Final 24-Hour PM2.5 Nonattainment Areas (2006 Standard)

Counties previously considered attainment: Lehigh Northampton


http://www.epa.gov/pmdesignations/2006standards/final/region3.htm

PM2.5 Nonattainment Timeline


Table in part from http://www.epa.gov/oar/particlepollution/naaqsrev2006.html

New Source Review 101 Federal pre-construction air permitting program

designed to: Ensure ambient air quality standards

continue to be met in “clean air” (attainment) areas Prevention of Significant Deterioration

(PSD) Ensure state-of-the-art pollution controls are

installed on new or existing facilities undergoing major modifications Nonattainment New Source Review

(NA NSR)


PM2.5 Implementation Rule

Federal Register Notice May 16, 2008 (effective July 15, 2008)

Finalized NSR Provisions Applicability of NSR to PM2.5 Precursors Major Source Thresholds Significant Emission Rates Offset Ratios for PM2.5

Interpollutant Trading for Offsets Note: Rule did not address PSD modeling

requirements.© 2009, Trinity Consultants, All rights reserved.

PM2.5 Implementation Rule Treatment of PM2.5 Precursors

SO2 – “Mandatory Precursor” NOx – “Presumptive Precursor”

Unless a state can demonstrate that NOx is not a significant contributor to PM2.5 formation

VOCs and NH3 – “Candidate Precursors” Not precursors, unless a state demonstrates

that they are a significant contributor to PM2.5 formation


Implementation Timing in PA PSD

PM2.5 Implementation went into effect July 15, 2008 since delegated program

Complete (“in the pipeline”) PSD permit applications can continue to rely on 1997 transitional guidance However, EPA has currently stayed this

provision (until 9/1/09 or longer). Recent EPA Orders necessitate case-by-case application of surrogate policy.


Implementation Timing in PA NA NSR

According to PA DEP, NA NSR SIP (Chapter 127) does not apply to PM2.5 nonattainment (follow Appendix S) NOx is not treated as precursor for time

being Provides for 10 year lookback in

determining past actual emissions for netting

Draft PM2.5 implementation proposal in review process

DEP does not have plans to add VOC or NH3 as PM2.5 precursor. Nor do they expect to rebut NOx as a PM2.5 precursor


Status of PM2.5 Rule Implementation in PA

Once Chapter 127 is updated for PM2.5.... 5 year baseline actual emissions period

(except with DEP approval) will apply (vs. 10 year baseline period in Federal rules)

De minimis increase calculation (10-yr contemporaneous period computation) in §127.203 may apply


What about Condensables? As per the 05/16/08 final rule, condensables

(CPM) need not be considered in setting emission limits and determining NSR applicability for PM, PM10, and PM2.5 until the earlier of

Date EPA comes up with an acceptable test method January 1, 2011

States have discretion/primacy on CPM inclusion (EPA Region 3 strongly encouraging states to include CPM limits during transition period)

PA DEP has issued permits with CPM limits


Status of PM2.5 Test Methods March 25, 2009 EPA proposed new test

methods for filterable PM10 and PM2.5, as well as condensable PM (74 FR 12970) Proposed Method 201A

OTM 27 – Cascade Impactor (Gravimetric) Method Proposed Method 202

OTM 28 – Dry Impinger Method http://earth1.epa.gov/ttn/emc/proposed.html

Major concern with EPA’s proposal to shorten/abandon the original transition period (January 1, 2011)


Case Studies Case Study 1: Major New Source in

PM2.5 Attainment County Case Study 2: Major New Source in

PM2.5 Nonattainment County Case Study 3: Major Modification to

Existing Major Source in PM2.5 Nonattainment County


Is the facility a new or existing major source? Attainment areas

100 tpy for PSD “listed” source categories 250 tpy for all other source categories

Nonattainment areas 100 tpy direct PM2.5 emissions for NA NSR

If new source is major (PTE>MST) PSD and/or NA NSR apply.

If new source is not major (PTE<MST) NSR does not apply.

If existing major source...

Major Source Thresholds


Modifications to Existing Source Step 1 – Does project result in a project increase greater

than the significant emission rates (SERs)? Step 2 – Is net emissions change greater than the SERs? SERs triggering PSD for PM2.5 at existing major sources

Net change includes contemporaneous changes (5 years prior to start of construction and ending with start of operation)

According to EPA, if the PSD significance level is exceeded for a precursor, but not for direct PM2.5, then PSD review is triggered for the precursor but not for PM2.5.


TPY

PM2.5 10

SO2 40

VOCs, NOx 40**if state IDs as

precursor

Condensables PA DEP has not been requiring inclusion of

condensables into netting equations at this time (other states may ask for CPM emissions to be quantified).

Be prepared to quantify PM2.5 filterable and condensable (consider proactive testing)

Fugitive emissions For now, all sources must include fugitives in

netting Awaiting EPA reconsideration on whether fugitives

are to be excluded from non “listed” sources Ensure data is available to accurately quantify

fugitive emissions (i.e., vehicle mileage for fugitive road emissions)

Are Condensables and Fugitives Considered?


Case Study Example 1 A new “listed” source is to be located in a

PM2.5 attainment area and has the potential to emit 300 tpy PM2.5, 300 tpy of NOx and 50 tpy of SO2. Would this project be subject to NA NSR and PSD?


Case Study Example 1

Step 1: Is the planned source a new “major source”?


Potential Emissions

(tpy)

Threshold (tpy)

Major?

PM2.5 300 100 Yes

SO2 50 100 No

NOx 300 100 Yes

Case Study Example 1 Applicability Determination:

PSD applies for both PM2.5 and NOx since the project will be a new major source.

PSD does not apply for SO2 since the project is not major for that pollutant

NA NSR does not apply to PM2.5 or SO2 since located in an attainment area.

Note that since the project is in PA, and thus the OTR, NOx would also be subject to NA NSR as an ozone precursor. NA NSR requirements discussed later.


Best Available Control Technology Analysis

(BACT)

Class I Areas

Additional Impacts Analysis

Preconstruction Monitoring Requirement

Air Quality Analysis (NAAQS, PSD Increment)

Requirements Under PSD


Background data For NAAQS analysis, background added to modeled

concentration; typically one value for the entire year States set background concentrations for modeling based on

local monitoring data or will require sites to install and operate onsite monitor

Actual “background monitor” concentrations are well over half the standard in many cases

Example, Centre County annual avg. PM2.5 for 2008 is 11.7 ug/m3 versus NAAQS of 15 ug/m3

Results in limited margin for expansions involving plant PM2.5 emissions in attainment areas

Secondary transformations EPA not requiring modeling at this time (models not

available) Fugitive sources (i.e., roads, piles, material transfers)

Modeling fugitives can be extremely time and resource consuming

Regional Inventory modeling

Concerns Regarding PSD Modeling


Case Study Example 2 The same source as in Example 1 (potential to

emit 300 tpy PM2.5, 300 tpy of NOx and 50 tpy of SO2) is to be built in a nonattainment area for PM2.5.

Would this project be subject to NA NSR and PSD?


Case Study Example 2

Step 1: Is the planned source a new “major source”?

Same as before...


Potential Emissions

(tpy)

Threshold (tpy)

Major?

PM2.5 300 100 Yes

SO2 50 100 No

NOx 300 100 Yes

Case Study Example 2 Applicability Determination: NA NSR applies for PM2.5 since the project is major in a

nonattainment area. NA NSR (and PSD) does not apply to SO2 since the source

is not major for SO2 (precursors are treated independently similar to ozone nonattainment).

PSD applies for NOx since the project is major and since NOx is not a PM2.5 precursor under Appendix S (current applicable NA NSR regulation).

Note that since the project is in the OTR, NOx would be subject to NA NSR as an ozone precursor.

Once PA adopts its PM2.5 NA NSR SIP revisions, NOx would also be regulated as PM2.5 precursor (offset locale would be most notable difference)


Lowest Achievable Emission Rate Lowest achievable emission rate of a similar source

anywhere in the country. Difficult to determine and potentially expensive to

meet LAER Alternative Sites Analysis Obtain Offsets

Generally, offsets must be obtained from same nonattainment area (unless study proves emissions contribute to another nonattainment area)

Offset availability can be substantial permitting hurdle.

Requirements Under NA NSR


Nonattainment Areas: Interpollutant Trading EPA allows regional or statewide

interpollutant trading of PM2.5 and its precursors Permit-by-permit trading prohibited Suggested trading ratios – states may use

or develop their own: 200 tons NOX per ton of primary PM2.5, and vice

versa (Eastern US) 40 tons SO2 per ton of primary PM2.5, and vice

versa First example of interpollutant trading

(SO2 for PM2.5) approved in PA in May 2009


Case Study Example 3 An existing major source of PM2.5, NOx and SOx in a PM2.5

nonattainment area proposes to modify one of its boilers. The largest amount of emissions (24-month average) reported in the past 10 year period and the new potential to emit for the boiler as are follows:

Is the project subject to PSD and/or NA NSR?


PollutantHistorical

(tpy)

Potential Emission

s(tpy)

PM2.5 10 21

SO2 75 200

NOx 125 200

Case Study Example 3 Step 1: Is the project significant?


Pollutant

Historical(tpy)

Potential

Emissions

(tpy)

Project Increase (tpy)

SER (tpy)

Above SER/

Trigger Netting

?

PM2.5 10 21 11 10 Yes

SO2 75 200 125 40 Yes

NOx 125 200 75 40 Yes

Case Study Example 3 In the past year, the facility also

decommissioned a small emergency generator with actual emissions decreases of 2 tpy of PM2.5, 5 tpy of SO2 and 10 tpy of NOx. This is the only project in the past 5 years. Does the project trigger PSD and/or NA NSR requirements?


Case Study Example 3 Step 2 – Is there a net emission increase? The decommissioning of the emergency generator falls

within the contemporaneous period (i.e., it occurred less than 5 years from the start of construction on the project) and as such it is a contemporaneous change.


Pollutant

Project Increase

(tpy)SER (tpy)

Trigger Netting

?

Contemp.Changes (tpy)

Net Emissions Change

(tpy)

Above SER?

PM2.5 11 10 Yes -2 9 No

SO2 125 40 Yes -5 120 Yes

NOx 75 40 Yes -10 65 Yes

Case Study Example 3 Applicability Determination:

Not subject to NA NSR for PM2.5 since the project is not a major modification in a nonattainment area (PSD does not apply either).

Since PA DEP is following Appendix S for PM2.5, de minimis netting under Chapter 127 is not required.

NA NSR (LAER, offsets) does apply to SO2 since the source is a major modification for SO2 and SO2 is a precursor. The project is also subject to PSD for SO2.

PSD applies for NOx since it is a significant emissions increase but NA NSR does not apply since NOx is not a PM2.5 precursor under Appendix S.

In PA, NOx would trigger NA NSR review as an ozone precursor.


PM2.5 Strategy – Thinking Ahead

Gain a better understanding of PM2.5 emissions, including condensables, for inventory purposes

Consider proactive stack testing (OTM 28) Ensure inventories are complete as they are relied upon in

netting analyses File ERC applications for PM2.5, SO2, and NOx (trading

is more stringent than OTR) Make sure that any PM2.5 limits are clearly specified

as excluding condensables or condensables are properly accounted for in the limitation

Stay tuned for other rulings that may impact state-level implementation of PM2.5 (CAIR, Revised NAAQS, etc.)


CAIR

Clean Air Interstate Rule (CAIR) January 2004 – EPA proposes the Interstate Air

Quality Rule (IAQR) May 12, 2005 – EPA issues CAIR

Covers 28 eastern states and the District of Columbia

Requires states to submit SIPs for significant SO2 and NOx reductions from electric generating units

April 28, 2006 – EPA publishes CAIR FIPs with federal requirements to be followed until replaced by an approved SIP 40 CFR 75 Acid Rain Program and NOx SIP Call

monitoring requirements


CAIR Vacatur (1 of 2) July 11, 2008 – after numerous legal

challenges, the CAIR Rule vacated and remanded to EPA

“Because we find more than several fatal flaws in the rule and the Environmental Protection Agency (“EPA”) adopted the rule as one, integral action, we vacate the rule in its entirety and remand to EPA to promulgate a rule that is consistent with this opinion.”

December 23, 2008 – D.C. Court decides to remand, rather than vacate CAIR, thus leaving CAIR (as well as CAIR FIPs) in place until EPA issues a new rule to address the concerns in the July 2008 decision

EPA expects development of new rule could take approximately 2 years


CAIR Vacatur (2 of 2) May 6, 2009 – EPA proposes stay of CAIR

and CAIR FIP for the state of Minnesota MN argued that EPA overstated its emissions

and incorrectly included MN in the CAIR rule when it should not have

CAIR remains in place in its final form (no provisions were modified by the court) until EPA develops the replacement rule

The original CAIR deadlines are still in effect

EPA has converted NOx budget allowances into CAIR ozone season accounts (NOx budget accounts are “inactive”)


Revised NO2 NAAQS

Sources of NOx Pollution

Source: EPA Office of Air Quality Planning and Standards (http://www.epa.gov/air/nitrogenoxides/actions.html )

Current Annual Average Standard = 53 ppb (100 µg/m3)

Proposed revisions published in Federal Register on July 15, 2009

Proposed New 1-Hour Standard = 80 – 100 ppb EPA seeking comment on alternative levels of the

standard - from levels down to 65 ppb and up to 150 ppb

EPA seeking comment on an alternative approach to supplement the current annual standard with a community-wide 1-hr standard of 50 – 75 ppb

EPA is proposing to retain the current annual standard EPA is proposing no changes to the secondary standard

under this review Comments due by September 15, 2009

Public hearings in Arlington, VA and LA in August

Proposed Revisions to NO2 NAAQS

Sources with a modeled impact > ~5 µg/m3 will likely have trouble meeting the 1-hr standard as proposed.


1-Hour NO2 Standard Implementation

January 2010 – EPA issues final standard January 2011 – States submit designation

recommendations to EPA January 2012 – EPA designates most areas

“unclassifiable” (because near-road monitors not in place)

January 2013 – New near-road monitors in place January 2015 – Next NO2 NAAQS review January 2017 – Non-attainment redesignations January 2022 – Attainment date


Questions?Ian Donaldson

([email protected])MD Office: 240-379-7490 x106

Wendy Merz([email protected])

PA Office: 610-777-0350

Documents

Regulatory Update New Source Review Permitting Case Studies & Regulatory Updates August 26, 2009 ARIPPA Technical Symposium trinityconsultants.com