Implications of Proposed Ozone Standards in Southeast Missouri (SEM) SMRPC Meeting, Perryville, MO April 24, 2015 Joletta Golik

Overview ˃ Proposed O 3 NAAQS ˃ Implication of Proposed O 3 NAAQS ˃ Nonattainment Permitting

Proposed Ozone NAAQS

EPA’s Proposed November 25, 2014 Rule ˃ Propose to lower the primary and secondary NAAQS to within the range of 65 to 70 ppb ˃ Add an Appendix U to 40 CFR Part 50 detailing data selection, handling, and reporting requirements for ozone NAAQS – For MDNR ˃ Revise ambient monitoring requirements for ozone monitoring ˃ Add a grandfathering provision to PSD permitting program exempting pending permits from the revised ozone NAAQS when they are fully promulgated

Proposed Revisions to Ozone NAAQS ˃ Proposed grandfathering provision for pending PSD permits ˃ Timing is critical here ˃ More ˃ Change the Air Quality Index so that the primary NAAQS equals 100 on the index

Proposed O 3 NAAQS SEM Attainment Status ˃ Based on monitoring data, counties in southeast Missouri maybe designated as nonattainment areas ˃ Nonattainment classification depends on final O 3 standards  Marginal  Moderate

What are the Implications of an Area Being Declared Nonattainment?

Definition of Major Source ˃ The definition of a “major stationary source” changes depending on the classification of the nonattainment area – in the case of the example provided for an ozone nonattainment area  100 tpy – marginal or moderate nonattainment for ozone  50 tpy – serious nonattainment for ozone  25 tpy – severe nonattainment for ozone  10 tpy – extreme nonattainment for ozone  Classification dependent on the level of the monitored design value of the area over the standard  “major stationary source” applies to both New Source Review (NSR) and Title V connotations

Key Requirements 1. Lowest Achievable Emission Rate (LAER) 2. Obtain emissions offsets 3. Alternatives Analysis  Sites, sizes, production processes, and environmental control techniques 4. All major sources in state must be in compliance with all applicable emission limitations and standards PSD NA-NSR* 1.Control Device Review (BACT) 2.Air Quality Review  NAAQS analysis  PSD increment analysis 4.Class I Areas 5.Additional Impacts Analysis  Growth  Visibility  Soils, Vegetation, Animals * Federal NA-NSR program is presented. State NA-NSR programs are established in state SIPs and may contain major differences. It is important to review state NA-NSR program!

The Takeaways! ˃ Nonattainment Designation  More stringent state regulations likely for major sources  NSR/Title V Major source threshold lower in nonattainment areas  Nonattainment New Source Review permitting can be challenging  Nonattainment designations tend to impact industrial growth in the designated nonattainment area ♦ A new source wishing to construct a facility within a nonattainment area with a potential to emit of 80 tpy of NO X and 70 tpy of VOC would be required to undergo nonattainment NSR for NO X and VOC. Outside of this nonattainment area, the site would be a true minor source of emissions.

Implications of Proposed Ozone NAAQS

Attainment Year - All NAA 10/1/2037 Attainment Year - Serious NAA 10/1/2026 Attainment Year - Moderate NAA 10/1/2023 Attainment Plans 10/1/2020 Attainment Year - Marginal NAA 10/1/2020 SIP Infrastructure Setup 10/1/2018 EPA Finalize Area Designations 10/1/2017 State and Tribe Recommendation for Area Designations 10/1/2016 Final NAAQS Rule 10/1/2015 Proposed Rule 11/25/2014 Non Attainment New Source Review PSD – Grandfathered or Complicated PSD – 2008 NAAQS Proposed Rule Timeline

PSD Review before October 2015 ˃ Required when  Project VOC emissions > 100 tpy And\Or  Project NO X emissions > 100 tpy ˃ Quantitative Demonstration ˃ Qualitative Demonstration

PSD Review after October 2015 before October 2017 (1 of 2) ˃ PSD Grandfathering -  PSD permit application “in the pipeline” & “meeting certain criteria” would be only required to consider its impact on 2008 NAAQS  No clear “criteria” provided by EPA, instead seeking public comments on appropriate criteria for grandfathering ˃ Till then  Qualitative Analysis  Quantitative Analysis

PSD Review after October 2015 before October 2017 (2 of 2) ˃ Main Purpose of the Analysis  To demonstrate net improvement increase in the overall air quality in the area  Analysis of project’s potential impact on the overall air quality in the area  Comparison of project impact to screening thresholds\ de-minimis values

Non Attainment New Source Review after October 2017 ˃ No Ozone Impact Analysis required ˃ Must procure\make available emission offsets for precursor emissions (VOC & NO X ) to improve air quality ˃ May have to show improvement in air quality using quantitative assessment

Other Nonattainment Area Implications (1 of 2) ˃ Nonattainment New Source Review (NANSR) Permitting  Applicable to new major sources or major modifications in nonattainment areas  Functionally similar to PSD permitting in some aspects. However, more challenging requirements including but not limited to; ♦ LAER ♦ Emissions Offsets  Unlike PSD, NNSR is evaluated solely on a pollutant-by- pollutant basis for source classification and review of modifications ♦ Major for one regulated NSR pollutant does not make a source major for all ♦ Exceeding major source threshold (MST) does not reduce threshold for other pollutants to Significant Emission Rate (SER)

Other Nonattainment Area Implications (2 of 2) ˃ Nonattainment New Source Review (NANSR) Permitting  LAER – Lowest Achievable Emission Rate ♦ The most stringent emission limitation contained in the implementation plan of any State for such class or category of source; or ♦ The most stringent emission limitation achieved in practice by such class or category of source. ♦ LAER is not a technology but an emission rate that can be achieved by any/all of add-on control technology, process changes or changes in raw materials or it can be a work practice  Emission Offsets ♦ “Obtained” (through purchase!) from existing sources located within the same nonattainment area region which must offset the emissions increase from the new or modified source and provided a net air quality benefit. ♦ Offsets obtained from Emission Reduction Credits (ERCs). Credits, in tpy, obtained at an offset ratio (i.e. 1.3 to 1) to provide a net air quality benefit.

Lowest Achievable Emission Rate (LAER) ˃ No allowance for economic analysis ˃ Costs associated with installing and operating the controls for LAER can be significant “without consideration of cost” ˃ Might require additional monitoring requirements  “Continuous Emissions Monitors (CEMS)”  Combustion temperature, pressure drop, etc ˃ These devices can have excessive repair and maintenance (due to excessive plugging and corrosion) ˃ Analyze and submit quarterly data quality reports ˃ Increased operational cost to demonstrate compliance

Example LAER Determinations ˃ Source  SourcePollutantLAER Control Heaters/BoilersNO X Ultra Low-NOx Burner Gas TurbineNO X Selective Catalytic Reduction Paint Spray BoothVOCCarbon Adsorber TanksVOC Proper design and operation of tanks (0.76 lbs/hr) Diesel EnginesNO X Design and limiting non- emergency operations to only 100 hr/yr each.

Emission Offsets ˃ These are emission reduction credits ˃ A facility in serious NAA for O 3 with a PTE of VOC for 50 tpy may be required to obtain 60 tpy of VOC emission reduction credits (60/50 = 1.2) Nonattainment Classification Major Source Threshold (tons/year) Offset Ratio Marginal Moderate Serious Severe Extreme

Emission Reduction Credits ˃ Emission reduction credits (ERCs) must be:  Real  Permanent  Quantifiable  Enforceable  Surplus ˃ Emission reduction credits must have occurred within ten years of application for the proposed project ˃ From the same nonattainment areas (unless otherwise approved) ˃ Generally the same pollutant credits are valid (unless a precursor or the SIP allows for inter-pollutant offsets

Impact on Title V Permitting ˃ Previous minor sources could become major Title V sources depending on designation ˃ Title V facilities in NAA require  Additional compliance assurance and periodic monitoring  Source testing, monitoring, recordkeeping and reporting ˃ Understanding applicable emission standards, operation practices, monitoring/testing, recordkeeping and reporting requirements ˃ Develop a system for tracking and reporting compliance Nonattainment Classification Major Source Threshold for NO X (tpy) Major Source Threshold for VOC (tpy) Marginal100 Moderate100 Serious50 Severe25 Extreme10

Impact on Title V facilities – Examples of CAM Control TechnologyPollutant Example CAM Strategy Frequency Recording Method Fabric Filter Baghouse PM Pressure drop across the device Each batch Datalogger or logbook FlareCO Visual presence of flame Twice per shift Logbook Carbon Adsorption System VOCs Time since last generation ContinuousStrip chart

Things To Do for Industry ˃ Calculate current site wide PTE to see the impact on any potential projects ˃ Permitting Strategy  Apply for PSD permits as soon as possible  Understand redesignation with regard to RACT, NSR permitting and Title V permitting and begin to plan accordingly ˃ Reduce emissions of precursors for O 3 (i.e., NO X and VOC) ˃ Understand ozone trends in your area ˃ NAA Preparation – Quantitative net air quality benefit analysis

Potential Impacts ˃ Business and economic business development concerns ˃ Direct and indirect costs to both public and businesses ˃ More stringent and expensive control equipment  Burners, boilers and heavy engines  Painting, coating and solvent uses ˃ Vehicle inspection program ˃ Reduced speed limits on highways and expressways ˃ May impact energy costs from power plants due to control devices installed on their end ˃ A public education campaign about ozone ˃ Cost of establishing SIP ˃ Cost of Transport Conformity

Things To Do for Community to Reduce O 3 Emissions in Summer ˃ Keep vehicle tires properly inflated as under inflated tires increase gasoline consumption ˃ Carpooling, public transportation, bike or walk ˃ No overfilling of gasoline by stopping at first click when filling up gas tanks ˃ Not use gas-powered lawn mowers on hot, sunny days ˃ Conserve energy by turning off lights and appliances when not in use

Questions? Joletta Golik Phone: