Critical Air Permitting Developments 2012 March 29, 2012 Critical Air Permitting Developments 2012 Ed Bakowski, Permit Section Division of Air Pollution Control Illinois EPA

Overview Legislative and Regulatory Changes Greenhouse Gases (GHGs) March 29, 2012 Overview Legislative and Regulatory Changes Greenhouse Gases (GHGs)

P A 097-0095 (House Bill 1297) signed by Governor on 7/12/2011 March 29, 2012 P A 097-0095 (House Bill 1297) signed by Governor on 7/12/2011 Permit Streamlining Increased Operating Fees Sales Tax Revenue GHG Provisions

Permit Streamlining Registration of Smaller Sources (ROSS) March 29, 2012 Permit Streamlining Registration of Smaller Sources (ROSS) Registration rather than permits Fee same as Small sources Mandatory As many as 3850 out of 6400 total permits

Permit Streamlining General Permits March 29, 2012 Permit Streamlining General Permits Authorizes Illinois EPA to issue general permits for construction, installation, or operation of categories of facilities. Within 6 months of the effective date of bill, Illinois EPA, in consultation with regulated community, will identify types of permits for which general permitting would be appropriate, including but not limited to, permits for nonhazardous solid waste activities, discharge of stormwater from landfills, and discharges of hydrostatic test waters.

BOA – General Permits Concrete Batch Plants (stationary & portable) • Petroleum Dry Cleaners • Material (non-waste) crushers (portable only) • Soil vapor extraction/Air strippers (alone or at true minor sources)

Permit Streamlining Permits by Rule March 29, 2012 Permit Streamlining Permits by Rule Authorizes IPCB to adopt permits by rule for classes of facilities. Within 1 year of effective date of bill, Illinois EPA, in consultation with regulated community, will identify types of permits for which permitting by rule would be appropriate, including but not limited to, permits for open burning, certain package boilers and heaters using only natural gas or refinery gas, and certain internal combustion engines.

Permit Streamlining Expedited Permits March 29, 2012 Permit Streamlining Expedited Permits Permit applicant wishing expedited review can request for a fee equal to 4 times standard permit fee, not to exceed $100,000. For recurring permit fees (annual fees, operating fees, or discharge fees), fee shall be 4 times the recurring permit fee each time the applicant requests recurring permit be expedited. Where no standard fee is required for a permit, expedited permit fee is negotiated between permit applicant and Agency. All such expedited permit fees would be in addition to required standard permit fees. Time period required to review the permit is negotiated between the permit applicant and Agency. Should Illinois EPA fail to complete review within time period set forth, Illinois EPA required to refund expedited permit fee on prorated basis as mutually agreed upon by permit applicant and Agency.

Permit Streamlining Web Portal (initial launch by end of 2011) March 29, 2012 Permit Streamlining Web Portal (initial launch by end of 2011) Checklists and guidance relating to completion of permit applications By July 1, 2013 Online Application Forms User friendly forms that can be saved electronically and submitted to Agency electronically Online Tracking Review status of pending applications, including name and contact information of permit analyst. Until this system is up and running (within 2 years) Illinois EPA required to post tracking reports on its website that include timeframes for permit issuance and reasons for delays.

Permit Streamlining Notification of Assigned Analyst Permit Guidance March 29, 2012 Permit Streamlining Notification of Assigned Analyst Upon request of applicant, Agency shall notify applicant of permit analyst assigned to the application upon its receipt. Permit Guidance Agency authorized to prepare and distribute guidance documents relating to its administration of its permitting program and procedural rules implementing permit issuance procedures. Guidance documents prepared shall not be considered rules and shall not be subject to the Illinois Administrative Procedure Act. Such guidance shall not be binding on any party.

Permit Streamlining Draft Permit Submittal Draft Permit Review March 29, 2012 Permit Streamlining Draft Permit Submittal Permit applicants may include with application suggested permit language for Agency consideration. Agency is not obligated to use suggested language or any portion thereof in its permitting decision. If requested by permit applicant, Agency shall meet with applicant to discuss the suggested language. Draft Permit Review If requested by permit applicant, Agency shall provide a copy of the draft permit prior to any public review period. If requested by permit applicant, Agency shall provide a copy of the final permit prior to its issuance.

Increased Operating Fees March 29, 2012 Increased Operating Fees No increase to construction permit fees Beginning January 1, 2012 Title V From $18/ton to $21.50/ton Maximum fee from $250,000 to $294,000 FESOP Minimum (< 25 tons/yr) $200 to $235 25 to 100 tons/yr sources: $1,800 to $2,150 Maximum (> 100 tons/yr) from $3,500 to $4,112

Increased Fees Lifetime March 29, 2012 Increased Fees Lifetime Minimum (< 25 tons/yr) $200 to $235 25 to 100 tons/yr sources: $1,800 to $2,150 Maximum (> 100 tons/yr) from $3,500 to $4,112 Revenue from all 3 permit categories could bring in additional $1 - $3.2 million per year

March 29, 2012 Sales Tax Revenue Revenue from Sorbent Sales Partially Diverted to Fund Air Permit Program Beginning July 1, 2011, each month the Department of Revenue shall pay into the Clean Air Act (CAA) Permit Fund 80% of the net revenue realized for the preceding month from the 6.25% general rate on the selling price of sorbents used in Illinois in the process of sorbent injection as used to comply with the Environmental Protection Act or the federal Clean Air Act, but the total payment into the Clean Air Act (CAA) Permit Fund shall not exceed $2,000,000 in any fiscal year.

Rulemaking Required Regulations: Part 251 – State Fee Rules March 29, 2012 Rulemaking Required Regulations: Part 251 – State Fee Rules Part 201 – Permit by Rule Part 270 – CAAPP – Raise GHG Thresholds 254 – Add GHG Reporting Requirements Part 201.175 - New Rules for Registration of Smaller Sources (ROSS)

GHGs PA 097-0095 – Ties State GHG Permitting to Federal Requirements March 29, 2012 GHGs PA 097-0095 – Ties State GHG Permitting to Federal Requirements Permitting of GHGs is here - Final Tailoring Rule issued May 13, 2010 Tailoring Rule “adjusts” Title V and Prevention of Significant Deterioration (PSD) requirements Jim Ross 16

March 29, 2012 GHGs Regulated Air Pollutants and Subject to Regulation consistent with federal GHG tailoring rule (i.e., same thresholds, timing, and definitions). Establishes a permit exemption for sources of GHG emissions that are not subject to Tailoring Rule. If federal Tailoring Rule or ability to regulate GHGs is preempted due to federal legislation, judicial, or presidential action then the GHG provisions of Illinois legislation are likewise preempted. No fee charged for GHG emissions.

GHG Tailoring Rule Step 1 (January 2, 2011 – July 1, 2011) March 29, 2012 GHG Tailoring Rule Step 1 (January 2, 2011 – July 1, 2011) PSD only for “already subject anyway” sources New sources or existing sources with increase > 75,000 tons/yr CO2e Title V only for “already subject anyway” Can’t be subject to PSD or Title V solely due to GHGs Step 2 (July 1, 2011 to June 30, 2013) Continue Step 1 sources plus other large GHG sources Can now be subject to PSD and Title V due only to GHGs PSD: major = 100,000 tons/yr CO2e, significant increase = 75,000 tons/yr CO2e Title V: major = 100,000 tons/yr CO2e Step 3 (2011 to July 1, 2013 and beyond) New Rule to be proposed in 2011. Final rule by July 1, 2012. Effective on July 1, 2013. Possibly (likely) go to 50,000 tons/yr CO2e for PSD and Title V – can’t go lower than 50,000 tons/yr CO2e until at least 2016

March 29, 2012 Tailoring Rule Impact Evaluated at all levels – numbers below for 50,000 tons/yr CO2e Title V sources: Potential emissions = 196 sources Actual emissions = 90 sources PSD: New major sources per year = 24 Major modifications = 2

ROSS Program Jackie Sims & Annette Fulgenzi March 29, 2012 ROSS Program Jackie Sims & Annette Fulgenzi www.ienconnect.com/enviro 800/252-3998

ROSS Program Eligibility Requirements March 29, 2012 ROSS Program Eligibility Requirements       (1) the source must not be required to obtain a permit pursuant to the Illinois Clean Air Act Permit Program or Federally Enforceable State Operating Permit program, or under regulations promulgated pursuant to Section 111 (i.e., New Source Performance Standards - NSPS) or 112 (e.g., National Emission Standards of Hazardous Air Pollutants-NESHAP-Part 63) of the Clean Air Act;  (2) the USEPA has not otherwise determined that a permit is required;        

ROSS Program Eligibility Requirements (continued)  (3) the source emits less than an actual 5 tons per year of combined particulate matter (PM), carbon monoxide (CO), nitrogen oxides (NOx), sulfur dioxide (SO2), and volatile organic material (VOM) air pollutant emissions; (these are emissions from permitted units – excludes units that do not require a permit) Example – Rock Quarry:   Crushing               0 .2 tons PM  Screening              0.2 tons PM  Gas Generator    1.0 tons NOx   Gas Generator   0.2 tons CO                    Total                      1.6 tons < 5.0 tpy = ROSS Eligible  

ROSS Program Eligibility Requirements (continued)  (4) the source emits less than an actual 0.5 tons per year of combined hazardous air pollutant emissions; (5) the source emits less than an actual 0.05 tons per year of lead air emissions; (6) the source emits less than an actual 0.05 tons per year of mercury air emissions, and: Example – same as before – total for all units; excluding exempt units.

ROSS Program Eligibility Requirements (continued) (7) the source does not have an emission unit subject to a standard pursuant to 40 CFR Part 61 Maximum Achievable Control Technology (MACT), or 40 CFR Part 63 National Emissions Standards for Hazardous Air Pollutants (NESHAP)other than those regulations that the USEPA has categorized as "area source”. (some categories of NESHAP are for both major and area source, e.g., Reciprocating Internal Combustion Engines -RICE)

ROSS Program Eligibility Requirements (continued) (8) Emission units at the source are not used as thermal desorption systems pursuant to 35 Ill. Adm. Code 728 Table F or as an incinerator (9) The source is not subject to local siting review under Section 39.2 of the Act Mandatory Program - if you meet the applicability requirements, then you need to register

ROSS Registration Deadlines Sources holding a permit must register no later than their annual fee payment date in state fiscal year 2013 (July 1, 2012 through June 30, 2013). The registration fee is due by this date also. (Must be current on fees!) The owner or operator of an operating source not holding a permit shall register no later than July 1, 2012 and payment of the fee is due at the time of registration. The owner or operator of a new source shall register at least 10 days before commencing construction or operation and may commence construction or operation 10 days after submittal to the Agency. Fee payment is due at the time of registration.

ROSS Renewals Verify that facility meets eligibility requirements Combine the sum of all actual emissions of PM, CO, NOx, SO2, and VOM from all non-exempt units from prior calendar year Must be < 7.0 tons, or Sum of all from prior two calendar years < 10 tons. note: First year < 5.0 tons

ROSS Renewals Sum all actual emissions of HAPs, mercury and lead from all non exempt units from prior calendar year HAPs must be < 0.50 tons Mercury must be < 0.05 tons Lead must be < 0.05 tons Renewals are verified through the annual site fee If ownership, phone number, or address changes, submit information to Permit Section within 45 days of change-include ID number

ROSS Renewals If actual emissions exceeds ROSS eligibility Notify Permit Section If never had a permit – must apply for permit within 90 days of annual fee payment date If not constructed or operated during initial registration and exceeds eligibility within first two years – must also pay avoided construction fees. If existing source (had permit prior to ROSS) must notify Permit Section of change in status from ROSS to Permit by annual site fee date

ROSS Renewals Actual emissions exceed ROSS (continued) If units have changed since last permit – must update permit within 90 days of annual site fee date Once actual emissions meet ROSS eligibility requirements – go back to ROSS If there is a change in a regulation or a new regulation that impacts a ROSS source that causes the source to no longer be eligible for ROSS, the source must apply for a permit or go back to existing permit

ROSS Recordkeeping Maintain records on site Description of emission units and controls Description of control efficiency or emission rates used to be eligible for ROSS Documentation of emission calculations – may use material usage or emission rates Copy of initial registration Copy of last most recent five annual fee payments Any other records that are required by any State or Federal regulation.

ROSS Reporting ROSS sources that are impacted by a State or Federal regulations that require reporting, e.g., semi-annual reports, notification of compliance status, initial notifications, etc., MUST still submit the reports to Illinois EPA or USEPA as required. Example: ROSS source with boilers or engines that fall under an area source NESHAP (40 CFR 63 Subpart JJJJJJ or Subpart ZZZZ, respectively) would still be required to comply with regulations and maintain and submit all reports and tests required.

Annual Emission Reports BOA FAQ’s Annual Emission Reports If I’m a ROSS eligible source, do I have to submit my 2011 AER that is due May 1? No, once a source is ROSS eligible and are no longer required to have a permit, they do not have to submit the AER for 2011 and in the future.

ROSS FAQ’S NSPS & NESHAP If I’m covered by rules under regulations promulgated pursuant to Section 111 or 112 of the Clean Air Act, does that mean I am ineligible for ROSS? No, if the NESHAP does not require the source to have a permit the source could still be eligible for ROSS Actual emissions must meet eligibility criteria Example: RICE (Reciprocating Internal Combustion Engine) NESHAP

ROSS FAQ’s Initial Eligibility If I have 5.02 or 5.3 tons of actual combined pollutants but have been 3.6 tons and 3.0 tons the past few years, is their any consideration of our historical emissions? No, for initial registration it is a firm emission criteria of 5 tons. However for renewal: the total sum of actual emissions of combined air pollutant emissions for the prior calendar year must be less than or equal to 7 tons, and the total sum of actual emissions from the prior two calendar years must be less than or equal to 10 tons. (Summed emissions of HAPs, mercury or lead must be less than or equal to 0.5 tons per year, 0.05 tons per year, or 0.05 tons per year, for the prior calendar year, respectively.)

ROSS FAQ’s Exceeding ROSS Criteria: Now Need Permit If I am a ROSS source and I believe my actual emissions will push me out of the program into permits, how long do I have to notify the agency? Existing sources who previously were covered by a permit must notify the agency within 90 days of their site fee due date that they wish to reinstate their permit and will comply with its terms and/or modify their permit. ROSS sources not previously covered by a permit must apply for a permit 90 days prior to annual site fee renewal. (Note: the renewal criteria allows for emissions up to 7 tons for the prior year or two year combined total of 10 tons or less)

ROSS FAQ Circumvention Can I apply for ROSS for our new facility startup since our first year we expect our actual emissions to be low? If a new source was not constructed at the time of initial registration and exceed the initial actual emission eligibility criteria in the first or second year, the ROSS source must apply for an operating permit and pay applicable construction permit application fees. If an existing ROSS source constructs several emission units through the years and then exceeds the ROSS eligibility requirement, then they must only apply for a construction permit for the last emission unit that put them back into a permit and pay applicable fees.

Green House Gas (GHG)Emissions ROSS FAQ’s Green House Gas (GHG)Emissions Do GHG emissions determine my ROSS eligibility? No, GHG emissions as well as emissions from exempt activities or equipment are not considered in determining eligibility

PENDING PERMIT APPLICATIONS ROSS FAQ’S PENDING PERMIT APPLICATIONS What if I have already submitted my permit application to the BOA and I now qualify for ROSS? The source will be notified by permits that they must register under the ROSS program instead of acquiring a permit. The source will receive a refund for construction fees and they can be given a credit towards registration or a refund for the $235.

ROSS FAQ’s PORTABLE UNITS How will portable units be handled under ROSS? portable units that emit less than 5 tpy in aggregate at all locations need to register portable units pay one annual site fee of $235 when a portable is being moved, the company must submit new location information (use APC208 Form)

ROSS FAQ Will I receive notification that I am a registered ROSS source? Yes, sources will receive a confirmation letter that they are registered and those are going soon after received, generally within a week.

ROSS FAQ’S REASONS FOR REJECTION Common errors include: Not marking the certification checkbox Lack of signature No payment with a new source Non-payment of past site fees for existing sources applications are being checked against inventory for 2010 and may call those who do not appear to be eligible

ROSS Information & Contacts March 29, 2012 ROSS Information & Contacts General ROSS Questions & Assistance concerning ROSS: SBEAP 800-252-3998 ROSS Administrative issues: IEPA 217/785-1720 General Site Fee Questions: IEPA 217/782-7437 Registration Forms can be sent electronically to: EPA.BOA.ROSS@Illinois.gov Electronic Payment via Illinois E-Pay coming soon ROSS Information, Forms & Updates at: www.ienconnect.com/enviro

REMEMBER ROSS only eliminates the requirement for a permit (& AER) only, you must still comply with all applicable environmental requirements. ALL 3859 POTENTIAL ROSS SOURCES = LESS THAN 1% OF TOTAL EMISSIONS IN ILLINOIS

Thank You Any Questions? Ed Bakowski Manager, Permit Section March 29, 2012 Thank You Any Questions? Ed Bakowski Manager, Permit Section Division of Air Pollution Control Bureau of Air, Illinois EPA (217) 782-2113 ed.bakowski@illinois.gov Annette Fulgenzi Project Mgr, IL SBEAP IL Dept of Commerce & Economic Opportunity (217)524-5199 annette.fulgenzi@illinois.gov Jackie Sims IEPA (217)782-9333 That’s it. Will take some questions.