1. Nonattainment New Source Review (NA NSR) Program Raj Rao US Environmental Protection Agency Office of Air Quality Planning and Standards 919-541-5344, rao.raj@epa.govrao.raj@epa.gov

2. 2 What is the purpose of this discussion? 1. NA NSR Applicability 3. NA NSR Applicability and Netting Example 2. NA NSR Program Requirements

3. 3 How do we define a nonattainment area?  Areas in which air quality is worse than NAAQS levels  Such NA areas must improve air quality within a certain time period

4. 4 Which sources might be subject to the major NA NSR program?  New major sources  Existing major sources making major modifications  Physical or operational changes at the source  Change should show significant net emissions increase

5. 5 How do we determine if a new source is a major source under the NA NSR program? 1.Identify NA pollutants for new source 2.Determine source’s potential to emit (PTE) 3.Determine applicable major source thresholds 4.Determine if PTE exceeds major source threshold for any NA pollutant 5.If so, source is subject to major NA NSR for that pollutant

6. 6 How do I identify which pollutants are nonattainment pollutants?  Determine if area is in attainment or nonattainment for each criteria pollutant emitted by the source  To find this information:  Contact the appropriate EPA Regional Office or applicable permitting authority  Search an EPA database such as: www.epa.gov/air/datawww.epa.gov/air/data

7. 7 What is the source’s potential to emit (PTE)?  The maximum capacity of source to emit a pollutant under its physical and operational design  Based on operating 24/7 (8760 hours/year), unless restricted by a permit condition  Can include effect of emissions controls, if enforceable by permit or:  State Implementation Plan (SIP),  Tribal Implementation Plan (TIP) or  Federal Implementation Plan (FIP) conditions

8. 8 What is the applicable major source threshold?  100 tpy or lower depending on NA severity Nonattainment Areas PollutantNonattainment Classification Major Source Threshold OzoneMarginal (≥ 0.085 < 0.092 ppm)100 tpy of VOC or NOx Moderate (≥ 0.092 < 0.107 ppm)100 tpy of VOC or NOx Serious (≥ 0.107 < 0.120 ppm)50 tpy of VOC or NOx Severe (≥ 0.120 < 0.187 ppm)25 tpy of VOC or NOx Extreme (= 0.187 ppm and up)10 tpy of VOC or NOx Particulate Matter (10µm) Moderate100 tpy Serious70 tpy Carbon MonoxideModerate (9.1 – 16.4 ppm)100 tpy Serious (16.5 and up ppm)50 tpy Sulfur Dioxide, Nitrogen Oxides, PM2.5 and Lead Only one nonattainment classification100 tpy

9. 9 When is a modification subject to the major NA NSR program?  When:  The proposed project emissions exceed the significant emission rate (SER) and  The proposed project results in a significant net emissions increase (i.e., contemporaneous increases and decreases in emissions at the existing major source exceed the SER) after a netting analysis is performed  SER Examples:  40 tpy for VOC, NO 2, SO 2

10. 10 What steps should I follow to do a Netting Analysis? 1.Determine the emissions increase from the proposed project 2.Determine the beginning and ending dates of the contemporaneous period as it relates to the proposed modification 3.Determine which emissions units at the source experienced a physical or operational change that increased or decreased emissions during the contemporaneous period 4.Determine which emissions are creditable 5.Determine on a pollutant by pollutant basis, the amount of each contemporaneous and creditable emissions increase and decrease 6.Sum all contemporaneous and creditable increases and decreases with the increase from the proposed project to determine if a significant net emissions increase will occur

11. 11 1. Determine the emissions increase from the proposed project  If project emissions > significant emissions rate (SER), source determines its net emissions increase to know if it is a major modification or not  If project emissions < SER, source is exempt from review and is not a major modification  For example, SO 2 emissions from proposed project are 80 tpy. 80 tpy > 40 tpy SER, thus net emissions increase determination needed

12. 12  To determine the source’s net emission increase, we need to define the contemporaneous period  For NA NSR, States generally use 5 calendar years before the source commences operation  For 40 CFR Appendix S, period starts 5 years before the source commences construction and ends when the source commences operation  For example, our SO 2 source planned to commence construction in June 2006 and begin operation in September 2008, the contemporaneous period for Appendix S is defined as: 2. Determine the beginning and ending dates of the contemporaneous period June 2006 Commence Construction June 2005 June 2004 June 2003 June 2002 June 2001 June 2007 June 2008 Sept. 2008 Commence Operation 80 tpy

13. 13 3. Determine which units experienced an increase or decrease in emissions during contemporaneous period  Determine emission increases and decreases associated with a physical change or change in the method of operation at the source which did not require a PSD permit  For example, our SO 2 source increased its SO 2 emissions in 2003 and decreased its emissions in 2008 June 2006 Commence Construction June 2005 June 2004 June 2003 June 2002 June 2001 Sept. 2008 Commence Operation June 2007 June 2008 80 tpy

14. 4. Determine which emissions are creditable  An increase or decrease is not creditable if it has been previously relied on for issuing a permit and the permit is in effect during the review  A decrease is creditable only to the extent that it:  Is “federally-enforceable” from the moment that the actual construction begins  Occurs before the proposed emissions increase  Has the same health and welfare significance as the proposed increase from the source  A source cannot take credit for:  A decrease that it has had to make, or will make, in order to bring an emission unit into compliance  An emissions reduction from a unit which was permitted but never built or operated

15. 15 5. Determine the amount of each contemporaneous emissions increase or decrease  On a pollutant by pollutant basis  Based on difference between old level and new level of emissions for each unit  Past decreases and/or increases in actual emissions based on:  Average of any two consecutive years in the past 5 for utilities  Average of any two consecutive years in the past 10 for non-utilities  For example, SO 2 emissions decreases and increases are: June 2006 Commence Construction June 2005 June 2004 June 2003 June 2002 June 2001 June 2007 June 2008 40 tpy 80 tpy25 tpy Sept. 2008 Commence Operation

16. 16 6. Sum all contemporaneous and creditable increases and decreases with the proposed modification  NEI = PMEI + CEI – CED where:  PMEI = Proposed modification emissions increase  CEI = Creditable emission increases  CED = creditable emission decreases  For example, NEI = 80 + 25 - 40 = 65 tpy  65 tpy > 40 tpy SO 2 SER, project is a major modification June 2006 Commence Construction June 2005 June 2004 June 2003 June 2002 June 2001 June 2007 June 2008 40 tpy 80 tpy25 tpy Sept. 2008 Commence Operation

17. NA NSR Applicability and Netting Exercise

18. 18 Existing Source is Installing an Engine Testing Facility  First, determine if source is currently a major source  Source located in serious ozone nonattainment area PollutantPTE (tpy) NO 2 45 CO900 VOC355 Nonattainment Areas Major Source Thresholds PollutantNonattainment Classification Major Source Threshold OzoneSerious (≥ 0.107 < 0.120 ppm)50 tpy of VOC or NOx Carbon MonoxideSerious (16.5 and up ppm)50 tpy Nitrogen OxidesOnly one nonattainment classification exists 100 tpy

19. 19 Existing Source is Installing an Engine Testing Facility  Second, determine if existing source is making a major modification  Source:  Began construction in March 2006 with a 26 tpy permit limit for VOC Emission Unit Construction Date Potential VOC Emissions Coating LineMarch 20029 tpy 2 Spray Paint Systems September 2004 27 tpy each Constructed following emission units: Emission UnitActual VOC Emissions Degreaser #1199730 tpy 199840 tpy Degreaser #2199828 tpy 199926 tpy 20000 tpy 20010 tpy 20020 tpy Removed following emission units in 2002:

20. 20 Existing Source is Installing an Engine Testing Facility  Is the source currently a major one? Yes, for CO and VOCs  Is the new installation a major modification?  Step 1: 26 tpy VOC > 25 tpy SER for serious ozone nonattainment areas (CAA Section 183), source needs to determine NEI  Step 2: The contemporaneous period is: March 2006 Commence Operation Jan 2005 Jan 2004 Jan 2003 Jan 2002 Jan 2001 26tpy

21. 21 Existing Source is Installing an Engine Testing Facility  Is the new installation a major modification?  Step 3, 4, 5: Creditable emission increases and decreases during contemporaneous period are:  Step 6: Determine Net Emission Increases (NEI):  NEI = 26+ 54 + 9 – 35 – 27 = 27 tpy  27 tpy VOC NEI > 25 tpy SER for serious ozone nonattainment area  Source is a major modification March 2006 Commence Operation Jan 2005 Jan 2004 Jan 2003 Jan 2002 Jan 2001 9 tpy 54 tpy 35 tpy 27 tpy 26tpy

22. NA NSR Program Requirements

23. 23 What are the major NA-NSR program requirements?  LAER (Lowest Achievable Emission Rate)  Offsets at prescribed ratios  Alternative sites analysis  Statewide facility compliance certification  Public Involvement

24. 24 What is LAER?  Rate that has been achieved or is achievable for defined source  Rate may be in a permit or regulation  Requirement does not consider the following:  Economic  Energy  Environmental  Other factors

25. 25 What are emissions offsets and what are its requirements?  Emissions reductions from existing sources to balance emissions from proposed new or modified sources  Offset must be at least 1:1  Emissions offsets reductions must be:  quantifiable, enforceable, permanent and surplus (QEPS)  from actual emissions – real, no “paper”reductions  federally enforceable at the time of permit issuance for new source  in effect before the new source can commence operation

26. 26 How is alternative sites analysis defined?  Source owner must submit an analysis of:  Alternative sites  Sizes  Production processes  Environmental control techniques  Analysis for such proposed source must demonstrate that benefits significantly outweigh:  the environmental impacts  social costs imposed as a result of its location, construction, or modification

27. 27 How is compliance certification defined?  Source owner must c ertify that all other sources in that state that are:  Owned or operated by the source owner are  In compliance or  On an approved schedule for compliance

28. 28 What are the public participation requirements?  Public notice:  Must be for a 30-day period  Generally in regional and local newspapers  All public comments must be considered before a final permit is established  A Technical Support Document (TSD) generally including responses to comments may also be available with the final permit