New Source Review Rules Update Jessica Montanez U.S. Environmental Protection Agency Office of Air Quality Planning and Standards Air Quality Policy Division

2 Agenda 1.Brief Introduction to New Source Review 2.Tribal NSR Rules Rule Items Implementation Items 3.Other NSR Rulemakings/Actions

3 New Source Review (NSR) Requires industrial facilities to install modern pollution control equipment when: – they are built or – when making a change that increases emissions significantly

4 NSR (Continued) Purpose is to ensure environmental protection while allowing economic growth – Accomplished through permits Enforceable legal documents Requirements vary depending on NSR program type New Source Review (NSR) Program Major NSR in attainment areas (PSD) Major NSR in nonattainment areas (NA NSR) Minor NSR in all areas

5 General Permitting Process (New Sources) Start Determine source emissions (PTE per pollutant) Are emissions ≥ applicable threshold? (based on area classification, per pollutant) Source not subject to NSR Source owner submits permit application Reviewing Authority: Reviews application Performs control technology review Reviews or performs other requirements Develop draft permit Issue final permit End 30 day comment period Provisions for appeals available No Yes Public Hearing If Sufficient Interest PTE: Potential to Emit

6 Tribal NSR Rules Will establish NA NSR and Minor NSR program in Indian country Schedule – Proposal Published on August 21, 2006 – Comment Period Closed March 20, 2007 – Final Rule Scheduled for February 2010

7 Tribal NSR Rules – Main Items Under Consideration for Final Rule I.Minor NSR Program a.Applicability 1.Minor NSR Thresholds 2.List of Exempted Units and Activities 3.Accounting of Fugitive Emissions 4.Treatment of Existing Minor Sources 5.Applicability Test for Modifications b.Permit Application 1.Air Quality Impact Analysis Requirements 2.General Permits Issues 3.Case-by-Case MACT Determinations 4.Synthetic Minor Sources I.Minor NSR Program (Cont.) c.Permit Appeals 1.Type of Review: Judicial or Administrative d.Implementation 1.Delay Effective Date Depending on Type of Source II.Major NSR Program a.Permit Application 1.Offset Waivers 2.Compliance Certification Area

8 Tribal NSR Rules - Implementation Items I.Regional Workgroup a.Permit Review Process Timeline b.Public Notice Templates c.General Permits: a.Industrial Boilers b.Oil & Gas Industry c.Gas Stations - Work not yet initiated II.Tribal Workgroup a.Developed draft document: Consultation and Communication with Indian Governments – Tips for Establishing a Productive Relationship b.Developing templates (with OAQPS help) to request delegation of the three NSR programs c.Has raised questions about: 40CFR 52.21(u) – Delegation of Authority for PSD program

9 Other Upcoming NSR Rulemakings – Reasonable Possibility Identifies when a major source undergoing a physical or operational change not triggering major NSR permitting requirements must keep records Proposal Published on March 8, 2007 Final Rule Published on December 21, 2007 EPA Granted Rule Reconsideration on April 24, 2009

10 Other Upcoming NSR Rulemakings – Fugitive Emissions Fugitive Emissions: – Emissions that could not reasonably pass through a stack, chimney, vent or other functionally equivalent opening Final rule requires that fugitive emissions be included in determining whether a physical or operational change results in a major modification only for industries under section 302(j) of the Act Proposal Published on November 13, 2007 Final Rule Published on December 19, 2008 EPA Granted Rule Reconsideration on April 24, 2009

11 Other Upcoming NSR Rulemakings – Aggregation In 2006, EPA proposed three changes to the NSR program – Aggregation, Debottlenecking and Project Netting: – Changes related to which emissions increases and decreases to consider in determining major NSR applicability for sources undergoing a physical or operational change Proposal Published on September 14, 2006 Final Rule (Aggregation Only) Published on January 15, 2009 – Sources and reviewing authorities should combine emissions when projects are substantially related either technically or economically EPA Granted Rule Reconsideration on February 13, 2009 Another Final Rule Published on May 8, 2009 – Extends effective date of the rule until May 18, 2010

12 Other Upcoming NSR Rulemakings – PM-2.5 NSR Implementation Final rule addresses: – Major Source Thresholds – Significant Emissions Rates: PM-2.5 & Precursors – BACT for PM-2.5 – Offsets: PM-2.5 & Precursors – Offset Ratios – Condensable PM (CPM) and CPM Transition Period – Inter-pollutant Trading – Timing for Implementation – Transition Policy from PM-10 to PM-2.5 Proposal Published on November 1, 2005 Final Rule Published on May 16, 2008 EPA Granted Rule Reconsideration on April 24, 2009

13 Other Upcoming NSR Actions – CO 2 Interpretative Memo EPA Interpretation of “Regulated NSR pollutant” and “subject to regulation” under the Act – Includes only those pollutants “subject to a statutory or regulatory provision that requires actual control of emissions of that pollutant” – Excludes pollutants, including CO 2, for which the Act only requires monitoring Memo Published on December 18, 2008 EPA Granted Reconsideration on February 17, 2009

14 Contacts For more information please visit: Or Contact: Jessica Montañez Phone: Laura McKelvey Phone: Raj Rao Phone:

Rulemaking Schedule Appendix

16 PSD Program Requirements Sources with air emissions equal to or higher than 100 or 250 tons per year (tpy) Regulated pollutants: NAAQS and other pollutants Main requirements: – Install Best Available Control Technology (BACT) – Perform air quality analysis to assess impacts on air quality – Perform class I area analysis to assess impacts on national parks and wilderness areas – Perform additional impacts analysis – Allow for opportunities for public involvement EPA currently implements the PSD program in Indian Country

17 NA NSR Program Requirements Sources with air emissions of 100 tpy or lower depending on nonattainment severity Regulated pollutants: NAAQS only Main requirements: – Install Lowest Achievable Emission Rate (LAER) technologies – Obtain emission offsets – Perform alternative sites analysis – Show statewide facility compliance w/air regulations – Allow for opportunities for public involvement EPA’s final FIP would require major sources locating in Indian Country to be subject to the existing nonattainment major NSR rules for areas lacking an approved NA plan (40 CFR part 51, Appendix S)

18 Minor NSR Requirements Sources with air emissions equal to or higher than minor thresholds but below major NSR thresholds Regulated pollutants: NAAQS and other pollutants Main Requirements: – Perform Case by Case Control Technology Review – Perform Air quality analysis to assess impacts on air quality when needed – Allow for opportunities for public involvement Final rule will represent how EPA would implement program in Indian Country in the absence of an EPA approved plan

19 Significant Emission Rates (SERs) PollutantSER (tpy) PollutantSER (tpy) Carbon Monoxide100Hydrogen sulfide(H 2 S) 10 Nitrogen Oxides40Total reduced sulfur (including H 2 S) 10 Sulfur Dioxide40Reduced sulfur compounds (includes H 2 S) 10 Particulate Matter (PM 10 )15Municipal waste combustor organics 3.5 x Ozone40 of VOCs or NOxMunicipal waster combustor metals 15 Lead0.6Municipal waste combustor acid gases 40 Fluorides3Municipal solid waste landfills emissions 50 Sulfuric acid mist7 SER – a rate of emissions that would equal or exceed any of the following rates: