PROPOSED RULEMAKING
ENVIRONMENTAL
QUALITY BOARD
[25 PA. CODE CHS. 121 AND 127]
Nonattainment New Source Review
[36 Pa.B. 1991] The Environmental Quality Board (Board) proposes to amend § 121.1 (relating to definitions) and Chapter 127, Subchapter E (relating to new source review) to read as set for in Annex A.
This notice is given under the Board by an order at its meeting of December 20, 2005.
A. Effective Date
This proposed rulemaking will be effective upon final-form publication in the Pennsylvania Bulletin.
B. Contact Persons
For further information, contact John Slade, Chief, Division of Permits, Bureau of Air Quality, 12th Floor, Rachel Carson State Office Building, P. O. Box 8468, Harrisburg, PA 17105-8468, (717) 787-4325; or Robert ''Bo'' Reiley, Assistant Counsel, Bureau of Regulatory Counsel, 9th Floor, Rachel Carson State Office Building, P. O. Box 8464, Harrisburg, PA 17105-8464, (717) 787-7060.
C. Statutory Authority
This proposed rulemaking is being made under the authority of section 5(a)(1) of the Air Pollution Control Act (APCA) (35 P. S. § 4005(a)(1)), which grants to the Board the authority to adopt regulations for the prevention, control, reduction and abatement of air pollution.
D. Background and Summary
The primary goal of the Clean Air Act (CAA) (42 U.S.C.A. §§ 7401--7642) is to ensure the attainment and maintenance of air quality under the National Ambient Air Quality Standards (NAAQS) requirements under section 110 of the CAA (42 U.S.C.A. § 7410). The NAAQS are set at a level designed to protect public health and the general welfare. See section 109 of the CAA (42 U.S.C.A. § 7409). Standards have been established for the following six pollutants: sulfur dioxides (SOx), nitrogen oxides (NOx), particulate matter (PM10 and PM2.5), carbon monoxide (CO), ozone (O3) and lead (Pb).
Section 107 of the CAA (42 U.S.C.A. § 7407) and section 110 of the CAA give each state primary responsibility for assuring that air quality within its borders is maintained at a level consistent with the NAAQS. This responsibility is achieved through the establishment of source-specific requirements in state implementation plans (SIPs) addressing the NAAQS.
A primary means of achieving the NAAQS is through the New Source Review (NSR) program, which places preconstruction review and permitting requirements on certain new and modified sources of air pollution to protect public health and air quality. The nature of the requirements depends on whether the source is to be located in an area that attains, or does not attain, the NAAQS for the pollutant in question.
In enacting the CAA, Congress expressed a concern that the costs of retrofitting existing sources with state-of-the-art air pollution control technologies could be prohibitively expensive. Congress concluded that it would be more cost-effective to require high levels of technological performance at new and modified sources, because they have more flexibility as to the location and design of control equipment than do existing sources. As a result, new and modified sources are subject to more stringent levels of control, and hence more costly controls, under the CAA than existing sources.
There are two sets of regulatory requirements that subject new and modified sources to more stringent levels of control: the Prevention of Significant Deterioration (PSD) under Title I, Part C of the CAA (42 U.S.C.A. §§ 7470--7479) and the nonattainment NSR requirements under Title I, Part D of the CAA (42 U.S.C.A. §§ 7501--7515) under the NSR preconstruction permitting program.
The NSR program subjects major new or ''modified'' sources of air pollution to preconstruction review and permitting requirements. The PSD program applies to sources that have the potential to emit at least 250 tons per year (tpy) of a regulated pollutant, or at least 100 tpy of a regulated pollutant, if the source falls within a listed source category. See 40 CFR 52.21(b)(1) (relating to prevention of significant deterioration of air quality). SIPs must also contain provisions to prevent significant deterioration of air quality. See 40 CFR 51.166 (relating to prevention of significant deterioration of air quality).
The NSR program applies to sources that have the potential to emit at least 100 tpy of a regulated nonattainment pollutant. See section 302(j) of the CAA (42 U.S.C.A. § 7602(j)). These thresholds have been lowered for areas with more acute nonattainment problems, for instance, to 50 tpy for volatile organic compound (VOC) and 100 tpy for NOx in moderate areas, to 50 tpy for VOC and NOx in serious ozone nonattainment areas, to 25 tpy for VOC and NOx for severe areas and 10 tpy for VOC and NOx for extreme areas. See section 182 of the CAA (42 U.S.C.A. § 7511a).
The purpose of the NSR program is to ensure that the proposed source meets all applicable air quality requirements before it is constructed. The nature of the NSR preconstruction requirements depends upon whether the source is to be located in an area that meets or fails to meet the applicable ambient air quality standards.
Major stationary sources located in attainment areas are subject to the PSD permit program. Before a person can construct a major source in an attainment area, that person must receive a permit under the PSD program. To receive that permit, a person must show that the proposed source will, among other things, comply with the ambient air quality levels designed to prevent air quality deterioration and will employ the ''best available control technology'' for each regulated pollutant. See section 165 of the CAA (42 U.S.C.A. § 7475).
Major stationary sources located in nonattainment areas are subject to the NSR area permit program, which the states are responsible for implementing through their SIPs. Before a person can construct a major source in a nonattainment area, that person must receive a permit under the nonattainment permit program. To receive that permit, a person must show that the proposed source will, among other things, offset its potential to emit nonattainment pollutants by securing emission reductions from a nearby facility at a greater than 1:1 ratio and will employ the ''lowest achievable emission rate'' (LAER) for each regulated pollutant. See section 173 of the CAA (42 U.S.C.A. § 7503).
In 1996, the United States Environmental Protection Agency (EPA) published a proposed NSR rule at 61 FR 38250, 38251 (July 23, 1996) ''to provide States with greater flexibility to customize their own regulations implementing the NSR program.'' The EPA also decided to ease the burden on industry of complying with NSR requirements by ''significantly reduc[ing] the number and types of activities at sources that would otherwise be subject to major NSR under the existing NSR program regulations.'' See 61 FR 38251. The EPA estimated that the changes, if finalized, would result in approximately 50% fewer sources being subject to requirements under the PSD and nonattainment NSR provisions of the CAA. See 61 FR 38319. However, the EPA explained that it would not allow environmental benefits to be sacrificed to relieve the alleged burden on industry. See 61 FR 38250.
Two years later, the EPA published a Notice of Availability (NOA) at 63 FR 39857 (July 24, 1998) that presented its preliminary conclusions on certain aspects of the proposed rule and requested additional public comment. The EPA concluded that several of the reforms proposed in 1996 required additional safeguards to protect the environment and ensure accountability on the part of industry. See 63 FR 39859--39862.
In June 2002, after completing a review of the NSR program directed by the President's National Energy Policy Development Group, the EPA announced that it would finalize five elements of the proposed rule: (1) a revised methodology for determining whether a change at a source will increase emissions significantly, and thereby be considered a ''modification;'' (2) a new way to determine the emissions baseline used in measuring whether a significant emission increase will occur; (3) a plantwide applicability limit (PAL) permit that would allow a source to avoid triggering NSR requirements if it does not exceed an emissions cap; (4) an exclusion from NSR for any projects at a source designated as a ''clean unit;'' and (5) an exclusion from NSR for changes that are classified as pollution control projects.
At 67 FR 80186 (December 31, 2002), the EPA published the NSR rule, which finalized the previous five elements. For the PSD program, the NSR rule went into effect in this Commonwealth on March 3, 2003, because the Commonwealth automatically incorporates the Federal PSD requirements by reference under Chapter 127, Subchapter D (relating to prevention of significant deterioration of air quality). Since the Commonwealth does not incorporate the Federal nonattainment NSR provisions by reference, this proposed rulemaking is to address amendments regarding the Commonwealth's nonattainment NSR program in Chapter 127, Subchapter E, and will be submitted to the EPA as a revision to the Pennsylvania SIP.
The final version of the EPA's December 2002 rule contained neither the flexibility for states in implementing the rule provisions advertised in its proposed rule nor the additional accountability discussed in the NOA. Moreover, the regulations are likely to lead to increased air pollution, in turn causing harm to human health and the environment. To address these flaws, the Department, together with a number of other states, filed a petition for review in the D.C. Circuit Court of Appeals challenging the rule. See New York et al. v. EPA, (D.C. Cir.) (No. 02-1387 and consolidated cases).
On June 24, 2005, the Court of Appeals for the District of Columbia Circuit issued its opinion in New York et al., v. EPA, which addressed the challenges of the states and other petitioners to the EPA's NSR regulations published at 67 FR 80186. See New York et al. v. EPA, 413 F.3d 3, (D.C. Cir. 2005). The Court of Appeals upheld the NSR regulations in part, vacated them in part and remanded them in part. The Court of Appeals upheld the EPA's revised methodology for calculating emissions increases, which determines whether those increases are significant thereby triggering the NSR requirements, by comparing prechange actual emission levels to post-change projected actual emission levels or ''actual-to-projected-actual'' calculation methodology. The Court of Appeals upheld the EPA's 10-year ''look-back'' provision for calculating baseline emissions. This provision allows regulated entities to choose any 2 consecutive years in the preceding 10 (5 years for utilities) as their baseline. The Court of Appeals also upheld the EPA's newly prescribed use of the 10-year look-back period for purposes of determining baseline emissions levels and for measuring contemporaneous increases and decreases in the context of setting PALs. The Court of Appeals also upheld the EPA's ''demand growth exclusion'' which excludes from the calculation of emissions increases those increases not related to the change at the facility, but rather are attributable to growth in production as a response to increased product demand, which could have been accommodated by the facility before the change in question.
The Court of Appeals vacated the clean unit exemption provision on the grounds that the CAA requires any regulatory provision to evaluate emissions increases based on actual emissions, instead of potential or allowable emissions. This provision would have exempted an emissions unit from additional control technology if state-of-the-art controls based on an NSR review had been installed within the preceding 10 years or employed comparable state-of-the-art technology to comply with permit emission limits that would not violate other air quality requirements, even if any change in the emissions unit had increased the facility's net actual emissions.
The Court of Appeals also vacated the pollution control project exclusion provision on the grounds that the CAA provided no authority to exempt modifications causing significant emissions increases of a pollutant, even if the modifications are implemented primarily to reduce emissions of other pollutants. This provision would have excluded projects from NSR review that reduced emissions of some pollutants, allowed increases in others, but had a net beneficial environmental effect.
In this same opinion, the Court of Appeals remanded to the EPA for further consideration its provision that exempted facility owners or operators from any recordkeeping requirements if they believed a change had no reasonable possibility of producing a significant emissions increase. The Court of Appeals found that the EPA had not adequately explained how it would be able to detect and enforce against facilities improperly employing this exemption without adequate records being available.
In addition to the EPA's NSR rule published at 67 FR 80186, the EPA promulgated a number of other final rules that the Board addresses in this proposed rule related to when a facility is considered a major facility for the purposes of NSR. On April 30, 2004, the EPA published two final rules regarding the 8-hour ozone NAAQS. The first rule published at 69 FR 23858 is entitled ''Air Quality Designations and Classifications for the 8-Hour Ozone National Ambient Air Quality Standards: Early Action Compact Areas With Deferred Effective Dates.'' Among other things, this rule designated Bucks, Chester, Delaware, Montgomery and Philadelphia Counties as moderate nonattainment with the 8-hour ozone NAAQS. See 69 FR 23931.
The second rule EPA published at 69 FR 2395 (April 30, 2004) is entitled ''Final Rule To Implement the 8-Hour Ozone National Ambient Air Quality Standard--Phase 1.'' In that final action, the EPA addressed certain implementation issues related to the 8-hour standard, including the nonattainment major NSR program mandated by Title I, Part D of the CAA. This rule, among other things, determined that the CAA does not compel the EPA to retain the 1-hour ozone NAAQS major NSR requirements in implementing the 8-hour ozone NAAQS because, it concludes, NSR is not a control measure. Since the Department views this conclusion a violation of the CAA's antibacksliding provisions, it and a number of other states, on June 29, 2004, filed a joint petition for review challenging this rule in the Court of Appeals for the District of Columbia Circuit. See Massachusetts v. EPA (D.C. Cir.) (No. 04-1207).
The EPA published a final rule at 70 FR 44470 (August 3, 2005) entitled ''Identification of Ozone Areas for Which the 1-Hour Standard Has Been Revoked and Technical Correction to Phase 1 Rule.'' This rule codifies the revocation of the 1-hour standard for those areas with effective 8-hour ozone designations. This rule revoked the 1-hour ozone standard effective June 15, 2005, for all areas in this Commonwealth. See 70 FR 44477.
This proposed rulemaking incorporate some, but not all of the changes, which survived judicial scrutiny in New York et al., v. EPA, since the Board has determined that not all of the EPA's final NSR regulatory provisions are sufficiently protective of the air quality needs of this Commonwealth. In addition, this proposed rulemaking is consistent with the Commonwealth's litigation position in Massachusetts et al., v. EPA, that under the antibacksliding provisions of sections 172(e) and 193 of the CAA (42 U.S.C.A. §§ 7502(e) and 7515), the EPA is required retain the 1-hour ozone NAAQS major NSR requirements in implementing the 8-hour ozone NAAQS. Moreover, the Board has determined that to the extent any of the proposed amendments are more stringent than those required under the CAA, they are necessary to achieve or maintain the NAAQS, and therefore permissible actions under section 4.2(b)(1) of the APCA (35 P. S. § 4004.2(b)(1)).
One of the areas where this proposed rulemaking is different than the EPA's approach is the ''look-back'' provision for calculating baseline emissions. Under the EPA's approach, this provision allows regulated entities to choose any 2 consecutive years in the preceding 10 as their baseline, and in the case of utilities any 2 consecutive years in the preceding 5 years as their baseline. By extending this baseline period back from 5 years to 10 years, in the case of nonutilities, the EPA now allows facilities to select a higher baseline and reduce the possibility that NSR would apply. Under the Commonwealth's proposed approach in § 127.203a (relating to applicability determination), regulated entities operating in this Commonwealth may choose any 2 consecutive years in the preceding 5 as their baseline. By limiting this baseline period to 5 years there is an increased possibility that NSR would apply and state-of-the-art air pollution control technology would need to be installed. As a result, this proposed approach will reduce air pollution protecting public health and the environment, and ensuring that this Commonwealth can achieve and maintain the NAAQS.
In addition to the differences on this general ''look-back'' provision for calculating baseline emissions, the EPA allows regulated entities to choose any 2 consecutive years in the preceding 10 as their baseline for a PAL. Under the Commonwealth's proposed approach in § 127.218 (relating to PALs), regulated entities operating in this Commonwealth may choose any 2 consecutive years in the preceding 5 as their PAL baseline. Again, by limiting this baseline period to 5 years there is an increased possibility that NSR would apply and state-of-the-art air pollution control technology would need to be installed, which would reduce emissions and ensure that the NAAQS can be achieved and maintained.
Another area where the proposed amendments are more protective than the EPA's approach is the installation of emission controls on new emission units under an existing PAL. Under the EPA's approach, the installation of emission controls on new emission units under an existing PAL is not necessary if a facility is able to continue to comply with its PAL. Under the Commonwealth's proposed approach in § 127.218, the owners and operators of new emission units added under an existing PAL will need to reduce or control emissions by using the best available technology as required under section 6.6(c) of the APCA (35 P. S. § 4006.6(c)).
Another area of difference between the EPA's approach and the Commonwealth's proposed approach relates to the establishment of an emission limit for a proposed project. Under the EPA's approach, owners or operators are only required to track emissions for a period of time following a modification. Under the Commonwealth's proposed approach in § 127.203a(a)(6) and (7), an emission limit for the proposed project is established using the sum of three elements: 1) baseline actual emissions; 2) emissions that could previously be accommodated prior to the proposed modification; and 3) the projected actual emission increase due to the proposed project. The owner or operator shall demonstrate compliance with the established total emission limit and for 5 years, or 10 years when there will be a capacity increase, shall also demonstrate compliance with the projected actual emission increase which is due solely to the project. This proposed approach ensures that emissions from any modifications are legally enforceable.
In addition to the differences between the EPA's and the Commonwealth's approaches to the general NSR rule provisions, the Board also proposes that facilities in Bucks, Chester, Delaware, Montgomery or Philadelphia Counties that emit or have the potential to emit at least 25 tpy of VOCs or NOx will continue to be considered a major facilities and will be subject to the requirements applicable to a major facility located in a ''severe'' nonattainment area of ozone. This means that any facility that was major for VOCs or NOx while the region was classified as ''severe'' nonattainment for the 1-hour ozone standard will be major for those pollutants while the region is classified as moderate nonattainment under the 8-hour ozone standard. This is different than the EPA's approach which treats these facilities as major, and therefore subject to NSR, only if they emit 50 tpy for VOCs and 100 tpy for NOx since the area is classified as moderate nonattainment with the 8-hour ozone standard. Moreover, under the EPA's approach, offset requirements change from 1:3 to 1:1.15, while under the Commonwealth's proposed approach the offset requirements would remain unchanged. Additionally, these sources will continue to be subject to reasonably available control technology requirements. Because the 8-hour ozone standard is more stringent than the revoked 1-hour ozone standard, and to ensure that the Philadelphia area achieves and maintains the NAAQS, the proposed amendment is reasonably necessary to ensure that these facilities emit no more VOCs and NOx than previously allowed for attaining the 1-hour ozone standard.
The Department worked with the Air Quality Technical Advisory Committee (AQTAC) and the Citizens Advisory Council (CAC) in the development of this proposed rulemaking. The AQTAC and the CAC recommended that the Board consider the proposed rulemaking and seek public comment on the following issues: (1) whether the program should specify a 5-year or 10-year look-back; (2) whether PALs should have a 10-year term, should be fixed or declining, should be based on actual or potential emissions, should be reopened if emission limits change during the 10-year period and the potential enforcement consequences of noncompliance with a PAL; (3) whether the severe ozone nonattainment area provisions should be included for the five-county Philadelphia area; (4) whether permit limits should reflect the physical and legal capability of a source to operate without any modification (that is, demand growth exclusion); (5) to what extent should the Commonwealth develop an NSR regulation that differs from the Federal requirements; (6) de minimis aggregation with regard to hourly, daily and yearly applicability; and (7) the proposed emission limits under the advanced clean coal technology provision.
In addition to the issues identified by AQTAC and CAC, the Department is seeking public comment on what types of incentives may be offered through this proposed rulemaking to the owners and operators of facilities that implement voluntary proactive strategies to achieve ''environmental excellence.'' Incentives may include: (1) whether the program should offer a 10-year look back period if the 2-year period immediately preceding the construction or modification of a major new source within the 5-year contemporaneous period is not representative of normal operations, or other incentives for facilities that purchase electricity generated from alternative energy sources, generally, and integrated combined coal gasification technology, specifically, as provided under the Alternative Energy Portfolio Standards Act (73 P. S. §§ 1647.1--1647.7); and (2) whether the program should offer an extended 10-year look back period if the 2-year period immediately preceding the construction or modification of a major new source within the 5-year contemporaneous period is not representative of normal operations, or other incentives to facilities that enter into power purchase agreements with power plants that have committed to ''repower'' under the Commonwealth's recently announced Energy Deployment for a Growing Economy initiative, which promotes advanced coal gasification technology.
E. Summary of Regulatory Revisions
Certain definitions for terms in Chapter 121 (relating to general provisions) are proposed to be amended to ensure that reasonably available control technology remains applicable to major stationary sources of NOx and VOCs in Bucks, Chester, Delaware, Montgomery or Philadelphia Counties. The definitions include ''major NOx emitting facility'' and ''major VOC emitting facility.'' The proposed amendments are consistent with the changes being made in Chapter 127, Subchapter E regarding major facilities in Bucks, Chester, Delaware, Montgomery or Philadelphia Counties.
The amendments propose to delete definitions for terms in Chapter 121 that pertain only to Chapter 127, Subchapter E, which will be added to new § 127.201a (relating to definitions). The definitions include ''creation,'' ''de minimis emission increase,'' ''generation,'' ''major facility,'' ''major modification'' and ''secondary emissions.''
Section 127.201 (relating to general requirements), which applies to an owner or operator of a facility at which an emission increase that is significant would occur, is proposed to be amended. An additional proposed amendment under this section provides that facilities in Bucks, Chester, Delaware, Montgomery or Philadelphia Counties that emit or have the potential to emit at least 25 tpy of VOCs or NOx will be considered a major facility and shall be subject to the requirements applicable to a major facility located in a ''severe'' nonattainment area of ozone.
The proposed rulemaking adds § 127.201a for definitions of terms used in the substantive provisions of Chapter 127, Subchapter E. The new definitions include: ''actual emissions,'' ''actual PAL for a major facility,'' ''allowable emissions,'' ''baseline actual emissions,'' ''begin actual construction,'' ''CEMS--continuous emissions monitoring system,'' ''CERMS--continuous emissions rate monitoring system,'' ''CPMS--continuous parameter monitoring system,'' ''calendar year emissions,'' ''commence construction,'' ''creation,'' ''deactivation,'' ''de minimis emission increase,'' ''electric utility steam generating unit,'' ''emissions unit,'' ''Federally enforceable,'' ''fugitive emissions,'' ''generation,'' ''major facility,'' ''major modification,'' ''necessary preconstruction approvals or permits,'' ''net emissions increase,'' ''PAL--plantwide applicability limit,'' ''PAL effective date,'' ''PAL effective period,'' ''PAL major emissions unit,'' ''PAL major modification,'' ''PAL permit,'' ''PAL pollutant,'' ''PEMS--predictive emissions monitoring system,'' ''project,'' ''projected actual emissions,'' ''regulated NSR pollutant,'' ''secondary emissions,'' ''significant,'' ''significant emissions unit,'' ''significant net emissions increase'' and ''small emissions unit.''
Section 127.201b (relating to measurements, abbreviations and acronyms) adds measurements, abbreviations and acronyms. These include ''BAT--best available technology,'' ''CO2--carbon dioxide,'' ''CO--carbon monoxide,'' ''Hg--mercury,'' ''KWH--kilowatt hour (based on electric generation),'' ''lb--Pounds,'' ''µg/m3--micrograms per cubic meter,'' ''mg/m3--milligrams per cubic meter,'' ''O2--oxygen,'' ''SOx--sulfur oxides'' and ''tpy--Tons per year.''
Section 127.202 (relating to effective date) is proposed to be amended to include, among other things, PM2.5 and its precursors as pollutants.
Section 127.203 (relating to facilities subject to special permit requirements) is proposed to be amended and applies to the construction of a new major facility or modification at an existing facility located in a nonattainment area or located in an attainment or unclassified area, which impacts a nonattainment area in excess of certain significance levels. This section also includes provisions that would apply to an owner or operator of a facility in Bucks, Chester, Delaware, Montgomery or Philadelphia Counties or an area classified as a serious or severe ozone nonattainment area. Additionally, this section identifies when the NSR requirements apply and do not apply to owners and operators of facilities.
Section 127.203a is proposed to be amended and identifies the provisions the Department of Environmental Protection (Department) will use during its review of a plan approval application for the construction of a new major facility or modification at an existing major facility to determine if the NSR requirements are applicable to that major facility. The proposed amendments include provisions to determine net emission increases, baseline actual emissions and projected actual emissions.
Section 127.204 (relating to emissions subject to this subchapter) is proposed to be amended to make minor clarifications to ensure consistency with other proposed amendments to the subchapter.
Section 127.205 (relating to special permit requirements) is proposed to be amended to add additional provisions as to when LAER applies to a proposed modification within the contemporaneous period of a proposed emission increase and when emission offsets are required for the entire net emission increase that occurred over the contemporaneous period.
Section 127.206 (relating to ERC general requirements) is proposed to be amended to make minor clarifications to ensure that it is consistent with the other proposed amended being made to the subchapter.
Section 127.207 (relating to ERC generation and creation) is proposed to be amended to include that emission reductions necessary to meet BAT and allowance-based programs required by the CAA or APCA may not be used to generate emission reduction credits.
Sections 127.208, 127.209, and 127.210 (relating to ERC use and transfer requirements; ERC registry system; and offset ratios) are proposed to be amended to make minor clarifications to ensure consistency with other proposed amendments being made to the subchapter.
Section 127.211 (relating to applicability determination) is proposed to be deleted. Remaining applicable provisions are proposed to be moved to new § 127.203a.
Section 127.212 (relating to portable facilities) is proposed to be amended to include PM-2.5 and its precursors as pollutants and to make minor clarifications to ensure that it is consistent with the other proposed amendments being made to the subchapter.
Section 127.213 (relating to construction and demolition) is proposed to be amended to make minor clarifications to ensure that it is consistent with the other proposed changes being made to the subchapter.
Section 127.214 (relating to exemptions) is proposed to be rescinded.
Proposed § 127.214a (relating to special provisions for advanced clean coal generation technology) applies to an owner or operator of a project that uses advanced clean coal generation technology in a new electric utility steam generating unit or to retrofit or repower an existing electric utility steam generation unit. The qualifying electric utility steam generation unit will be deemed to meet the LAER control technology requirements of § 127.205 unless the Department determines that the performance requirements specified are less stringent than LAER.
Sections 127.215 and 127.217 (relating to reactivation; and Clean Air Act Titles III-V applicability) are proposed to be amended to make minor clarifications to ensure that it is consistent with the other proposed amendments being made to the subchapter.
Section 127.218 is proposed to be added to include PALs. If a facility follows the proposed provisions of this section and emissions are kept below a plantwide actual emissions cap, then these regulations allow the facility to avoid the major NSR permitting process when making changes to the facility or individual emissions units. The PAL will impose an annual emissions limitation in tons per year for the entire major facility. Each PAL must regulate emissions of only one pollutant. Each PAL will have an effective period of 10 years.
F. Benefits, Costs and Compliance
Benefits
Overall, the citizens of this Commonwealth will benefit from this proposed rulemaking because they will result in improved air quality by reducing criteria pollutant emissions, recognize and encourage pollution prevention practices and encourage new technologies and practices that reduce emissions.
Compliance costs
This proposed rulemaking will reduce the operating costs of industry through enhanced operational flexibility under PALs.
Compliance assistance
The Department plans to educate and assist the public and regulated community with understanding any newly amended requirements and how to comply with them. This will be accomplished through the Department's ongoing Regional Compliance Assistance Program.
Paperwork requirements
The proposed rulemaking will not increase the paperwork that is already generated during the normal course of business. However, the owner or operator of a facility that voluntarily elects a 10-year PAL shall retain records for at least 10 years to document that the emission limit was not exceeded.
G. Pollution Prevention
The Federal Pollution Prevention Act of 1990 established a National policy that promotes pollution prevention as the preferred means for achieving state environmental protection goals. The Department encourages pollution prevention, which is the reduction or elimination of pollution at its source, through the substitution of environmentally-friendly materials, more efficient use of raw materials and the incorporation of energy efficiency strategies. Pollution prevention practices can provide greater environmental protection with greater efficiency because they can result in significant cost savings to facilities that permanently achieve or move beyond compliance. This proposed rulemaking has incorporated the following pollution prevention incentives. The result of NSR requirements is that a company has a significant incentive to minimize their emissions to avoid NSR. If a company is unable to avoid NSR, then it must demonstrate that it is employing the lowest achievable emission reduction possible with existing technology. These minimized emissions can be achieved through process modifications and do not have to come from add-on control equipment. Pollution prevention is one of the most cost effective means to eliminate costly add-on controls or to reduce the costs of running add-on controls.
H. Sunset Review
These regulations will be reviewed in accordance with the sunset review schedule published by the Department to determine whether the regulation effectively fulfills the goals for which it was intended.
I. Regulatory Review
Under section 5(a) of the Regulatory Review Act (71 P. S. § 745.5(a)), on April 14, 2006, the Department submitted a copy of this proposed rulemaking and a copy of a Regulatory Analysis Form to the Independent Regulatory Review Commission (IRRC) and to the Chairpersons of the House and Senate Environmental Resources and Energy Committees. A copy of this material is available to the public upon request.
Under section 5(g) of the Regulatory Review Act, IRRC may convey any comments, recommendations or objections to the proposed rulemaking within 30 days of the close of the public comment period. The comments, recommendations or objections must specify the regulatory review criteria which have not been met. The Regulatory Review Act specifies detailed procedures for review, prior to final publication of the rulemaking, by the Department, the General Assembly and the Governor of comments, recommendations or objections raised.
J. Public Comments
Written comments--Interested persons are invited to submit comments, suggestions or objections regarding the proposed rulemaking to the Environmental Quality Board, P. O. Box 8477, Harrisburg, PA 17105-8477 (express mail: Rachel Carson State Office Building, 15th Floor, 400 Market Street, Harrisburg, PA 17101-2301). Comments submitted by facsimile will not be accepted. Comments, suggestions or objections must be postmarked by June 28, 2006. Interested persons may also submit a summary of their comments to the Board. The summary may not exceed one page in length and must also be postmarked by June 28, 2006. The one-page summary will be provided to each member of the Board in the agenda packet distributed prior to the meeting at which the final regulation will be considered.
Electronic comments--Comments may be submitted electronically to the Board at RegComments@state.pa.us and must also be received by the Board by June 28, 2006. A subject heading of the proposal and a return name and address must be included in each transmission.
K. Public Hearings
The Board will hold three public hearings for the purpose of accepting comments on this proposed rulemaking. The hearings will be held as follows:
June 6, 2006
7 p.m.Department of Environmental Protection
Rachel Carson State Office Building, Room 105
400 Market Street
Harrisburg, PA 17105
June 13, 2006
1 p.m.Department of Environmental Protection
Southwest Regional Office
Waterfront A and B Conference Rooms
400 Waterfront Drive
Pittsburgh, PA 15222.
June 19, 2006
1 p.m.Department of Environmental Protection
Delaware Room
Southeast Regional Office
2 East Main Street
Norristown, PA 19401Persons wishing to present testimony at a public hearing are requested to contact Natalie Shepherd, Environmental Quality Board, P. O. Box 8477, Harrisburg, PA 17105-8477, (717) 787-4526 at least 1 week in advance of the hearing to reserve a time to present testimony. Oral testimony is limited to 10 minutes per each witness. Witnesses are requested to submit three written copies of their oral testimony to the hearing chairperson at the hearing. Organizations are limited to designating one witness to present testimony on their behalf at each hearing.
Persons in need of accommodations as provided for in the Americans With Disabilities Act of 1990 should contact the Board at (717) 787-4526 or through the Pennsylvania AT&T Relay Service at (800) 654-5984 (TDD) to discuss how the Department may accommodate their needs.
KATHLEEN A. MCGINTY,
ChairpersonFiscal Note: 7-399. No fiscal impact; (8) recommends adoption.
Annex A
TITLE 25. ENVIRONMENTAL PROTECTION
PART I. DEPARTMENT OF ENVIRONMENTAL PROTECTION
Subpart C. PROTECTION OF NATURAL RESOURCES
ARTICLE III. AIR RESOURCES
CHAPTER 121. GENERAL PROVISIONS § 121.1. Definitions.
The definitions in section 3 of the act (35 P. S. § 4003) apply to this article. In addition, the following words and terms, when used in this article, have the following meanings, unless the context clearly indicates otherwise:
* * * * * [Creation--The process of generating usable and tradable ERCs to be used to offset emissions. This process includes the following steps: application, documentation, quantification, verification and entry in the registry.]
* * * * * [De minimis emission increase--An increase in actual or potential emissions which is below the threshold limits specified in § 127.203 (relating to facilities subject to special permit requirements).]
* * * * * [Generation--An action taken by a source or facility that results in the actual reduction of emissions.]
* * * * * [Major facility--A facility which has the potential to emit a pollutant equal to or greater than an applicable annual emissions rate in § 127.203.]
[Major modification--
(i) A physical change or change in the method of operation of a major facility that would result in an increase in emissions equal to or exceeding an emission rate threshold or significance level specified in § 127.203.
(ii) A net emissions increase that is significant for VOCs or NOx will be considered significant for ozone.
(iii) A physical change or change in the method of operation does not include:
(A) Routine maintenance, repair and replacement.
(B) The use of an alternative fuel or raw material by reason of any order under section 2(a) and (b) of the Energy Supply and Environmental Coordination Act of 1974 (ESECA) (15 U.S.C.A. § 79(a) and (b)) (or any superseding legislation) or by reason of a natural gas curtailment plan under the Federal Power Act (16 U.S.C.A. §§ 792--825r).
(C) The use of an alternative fuel by reason of an order or rule under section 125 of the Clean Air Act (42 U.S.C.A. § 7425).
(D) The use of an alternative fuel or raw material by a stationary source which meets one of the following conditions:
(I) The source was capable of accommodating before January 6, 1975, unless the change would be prohibited under an operating permit condition.
(II) The source is approved to use under an operating permit.
(E) An increase in the hours of operation or in the production rate, authorized under the conditions of an operating permit.
(F) Any change in ownership at a stationary source.
(G) The addition, replacement or use of a pollution control project at an existing source, unless the Department determines that the addition, replacement or use renders the source less environmentally beneficial, or except when the following apply:
(I) The Department has reason to believe that the pollution control project would result in a significant net increase in representative actual annual emission of any criteria pollutant, VOC or NOx over levels used for that facility in the most recent air quality impact analysis in the area conducted for the purpose of Title I of the Clean Air Act, if any (42 U.S.C.A. §§ 7401--7515).
(II) The Department determines that the increase will cause or contribute to a violation of any National ambient air quality standard or PSD increment, or visibility limitation.
(H) The installation, operation, cessation or removal of a temporary clean coal technology demonstration project, if the project complies with the following:
(I) The SIP.
(II) Other requirements necessary to attain and maintain the National ambient air quality standards during the project and after it is terminated.
(I) The installation or operation of a permanent clean coal technology demonstration project that constitutes repowering, if the project does not result in an increase in the potential to emit of any regulated pollutant emitted by the source. This exemption applies on a pollutant-by-pollutant basis.
(J) The reactivation of a very clean coal-fired electric utility system generating source.]
Major NOx emitting facility--A facility which emits or has the potential to emit NOx from the processes located at the site or on contiguous properties under the common control of the same person at a rate greater than one of the following:
* * * * * (v) 25 tpy or more of NOx and is located in Bucks, Chester, Delaware, Montgomery or Philadelphia County.
Major VOC emitting facility--A facility which emits or has the potential to emit VOCs from processes located at the site or on contiguous properties under the common control of the same person at a rate greater than one of the following:
* * * * * (iv) 25 tpy or more of VOC and is located in Bucks, Chester, Delaware, Montgomery or Philadelphia County.
* * * * * [Secondary emissions--Emissions which occur as a result of the construction or operation of a major stationary source or major modification of a major stationary source, but do not come from the major stationary source or facility or major modification itself. The secondary emissions shall be specific, well defined, quantifiable and impact the same general area as the stationary source or modification which causes secondary emissions. The term includes emissions from an offsite support facility which would not be constructed or increase its emissions except as a result of the construction or operation of the major stationary source or major modification. The term does not include emissions which come directly from a mobile source regulated under Title II of the Clean Air Act (42 U.S.C.A. §§ 7521--7589).]
* * * * *
CHAPTER 127. CONSTRUCTION, MODIFICATION, REACTIVATION AND OPERATION OF SOURCES
Subchapter E. NEW SOURCE REVIEW § 127.201. General requirements.
* * * * * (c) The new source review requirements of this subchapter also apply to a facility located in an attainment area for ozone and within an ozone transport region that emits or has the potential to emit at least 50 tons per year of VOC or 100 tons per year of NOx. A facility within either an unclassifiable/attainment area for ozone or within a marginal or incomplete data nonattainment area for ozone or within a basic nonattainment area for ozone and located within an ozone transport region will be considered a major [stationary] facility and shall be subject to the requirements applicable to a major [stationary] facility located in a moderate nonattainment area.
(d) The NSR requirements of this subchapter apply to an owner or operator of a facility at which a net emissions increase that is significant would occur as determined in accordance with § 127.203a (relating to applicability determination). If an emissions increase meets or exceeds the applicable emissions rate that is significant as defined in § 127.201a (relating to definitions), the facility is subject to the permitting requirements under § 127.205 (relating to special permit requirements). An emissions increase subject to this subchapter must also be offset through the use of ERCs at the offset ratios specified in § 127.210 (relating to offset ratios). The generation, use, transfer and registration requirements for ERCs are listed in §§ 127.206--127.209.
(e) In the event of an inconsistency between this rule and any other rule promulgated by the Department, the inconsistency must be resolved by the application of the more stringent provision, term, condition, method or rule.
(f) A facility located in Bucks, Chester, Delaware, Montgomery or Philadelphia Counties that emits or has the potential to emit at least 25 tpy of VOC or NOx will be considered a major facility and shall be subject to the requirements applicable to a major facility located in a severe nonattainment area for ozone.
§ 127.201a. Definitions.
The definitions in section 3 of the act (35 P. S. § 4003) and Chapter 121 (relating to general provisions) apply to this subchapter unless otherwise indicated. In addition, the following words and terms, when used in this subchapter, have the following meanings, unless the context clearly indicates otherwise:
Actual emissions--The actual rate of emissions of a regulated NSR pollutant from an emissions unit, as determined in accordance with the following:
(i) Actual emissions as of a particular date must equal the average rate, in tons per year, at which the unit actually emitted the pollutant during the consecutive 2-year period which immediately precedes the particular date and which is representative of normal source operations. The Department will allow the use of a different time period upon a written determination that it is more representative of normal source operation. Actual emissions shall be calculated using the unit's actual operating hours, production rates and types of materials processed, stored or combusted during the selected time period.
(ii) For an emissions unit that has not begun normal operations on the particular date, actual emissions equal the potential to emit of the unit on that date.
Actual PAL for a major facility--A PAL based on the baseline actual emissions of all emissions units at a major facility that emit or have the potential to emit the PAL pollutant.
Allowable emissions--The emissions rate of a source calculated using the maximum rated capacity of the source unless the source is subject to Federally enforceable limits which restrict the operating rate, or hours of operation, or both, and the most stringent of the following:
(i) The applicable standards set forth in 40 CFR Part 60 or Part 61 (relating to standards of performance for new stationary sources; and National emission standards for hazardous air pollutants).
(ii) An applicable SIP emissions limitation, including those with a future compliance date.
(iii) The emissions rate specified under a requirement or permit condition that is Federally enforceable or enforceable as a practical matter, including those with a future compliance date.
Baseline actual emissions--The rate of emissions, in tpy, of a regulated NSR pollutant, as determined in accordance with § 127.203a(a)(5) (relating to applicability determination).
Begin actual construction--Initiation of physical onsite construction activities on an emissions unit which are of a permanent nature. These activities include installation of building supports and foundations, laying of underground pipe work and construction of permanent storage structures. With respect to a change in method of operating, this term refers to those onsite activities other than preparatory activities which mark the initiation of the change.
CEMS--Continuous emissions monitoring system--All of the equipment that may be required to meet the data acquisition and availability requirements of this subchapter, to sample, condition, analyze and provide a record of emissions on a continuous basis.
CERMS--Continuous emissions rate monitoring system--The total equipment required for the determination and recording of the pollutant mass emissions rate, in terms of mass per unit of time.
CPMS--Continuous parameter monitoring system--All of the equipment necessary to meet the data acquisition and availability requirements to monitor process and control device operational parameters including control device secondary voltages and electric currents, other information like gas flow rate and O2 or CO2 concentrations, and to record average operational parameter values on a continuous basis.
Calendar year emissions--The rate of emissions of an NSR pollutant, in tpy, from an emissions unit during a calendar year.
Commence construction--The owner or operator of a major facility has all necessary approvals or permits including plan approval and has either:
(i) Begun, or caused to begin, a continuous program of actual onsite construction of the source, to be completed within a reasonable time.
(ii) Entered into binding agreements or contractual obligations, which cannot be canceled or modified without substantial loss to the owner or operator, to undertake a program of actual construction of the source to be completed within a reasonable time.
Creation--The process of generating usable and tradable ERCs to be used to offset emissions. This process includes the following elements:
(i) Application.
(ii) Documentation.
(iii) Quantification.
(iv) Verification.
(v) Entry into the registry.
Deactivation--Cessation of the emissions of an air pollutant from a unit or facility.
De minimis emissions increase--An increase in actual emissions or potential to emit which is less than the emissions rate that is significant as specified in this section.
Electric utility steam generating unit--A steam electric generating unit that is constructed for the purpose of supplying more than one-third of its potential electric output capacity and more than 25 MW electrical output to a utility power distribution system for sale. Steam supplied to a steam distribution system for the purpose of providing steam to a steam-electric generator that would produce electrical energy for sale is also considered in determining the electrical energy output capacity of the affected facility.
Emissions unit--A part of a facility that emits or has the potential to emit a regulated NSR pollutant including an electric utility steam generating unit as defined in this section. For purposes of this subchapter, there are two types of emissions units:
(i) A new emissions unit, which is or will be newly constructed and which has existed for less than 2 years from the date the emissions unit first operated. An emissions unit which is constructed or installed for the purpose of replacing an existing unit, or an emissions unit which is relocated from another facility for the purpose of replacing an existing unit, is considered a new emissions unit at the time of replacement and until 2 years from the date the new unit commenced operation.
(ii) An existing emissions unit which is not a new emissions unit.
Federally enforceable--All limitations and conditions which are legally enforceable by the EPA, including:
(i) Those requirements developed under 40 CFR Parts 60 and 61.
(ii) Those requirements within an applicable SIP.
(iii) Permit requirements established under 40 CFR 52.21 (relating to prevention of significant deterioration of air quality) or under regulations approved under 40 CFR Part 51, Subpart I (relating to review of new sources and modifications), including operating permits issued under an EPA-approved program that is incorporated into the SIP and expressly requires adherence to a permit issued under the program.
(iv) Permit requirements not designated as ''State-only'' in a Federal operating permit.
Fugitive emissions--Those emissions which could not reasonably pass through a stack, chimney, vent or other functionally equivalent opening.
Generation--With respect to emission reduction credits, an action taken by an owner or operator of a source or facility that results in the actual reduction of emissions.
Major facility--
(i) The term includes the following:
(A) A facility which emits or has the potential to emit 100 tons per year or more of any regulated NSR pollutant subject to regulation under the Clean Air Act, except that lower emissions thresholds apply as follows:
(I) Fifty tons per year of VOCs in a serious nonattainment area for ozone.
(II) Fifty tons per year of VOCs in an area within an ozone transport region except for a severe or extreme nonattainment area for ozone.
(III) Twenty-five tons per year of VOCs in a severe nonattainment area for ozone.
(IV) Ten tons per year of VOCs in an extreme nonattainment area for ozone.
(V) Seventy tons per year of PM-10 or, where applicable, 70 tons per year of a specific PM-10 precursor, in a serious nonattainment area for PM-10.
(VI) Fifty tons per year of CO in a serious nonattainment area for CO.
(B) For the purposes of applying the requirements of this subchapter to the owner or operator of a facility which emits or has the potential to emit NOx located in an ozone nonattainment area or in an ozone transport region, as follows:
(I) One hundred tons per year or more of NOx in an ozone nonattainment area classified as marginal, basic or moderate.
(II) One hundred tons per year or more of NOx in an ozone nonattainment area classified as a transitional, submarginal, or incomplete or no data area, when the area is located in an ozone transport region.
(III) One hundred tons per year or more of NOx in an area designated under section 107(d) of the Clean Air Act (42 U.S.C.A. § 7407(d)) as attainment or unclassifiable for ozone that is located in an ozone transport region.
(IV) Fifty tons per year or more of NOx in a serious nonattainment area for ozone.
(V) Twenty-five tons per year or more of NOx in a severe nonattainment area for ozone.
(VI) Ten tons per year or more of NOx in an extreme nonattainment area for ozone.
(C) A physical change that occurs at a facility which does not exceed the major facility thresholds specified in this subchapter is considered a major facility, if the change constitutes a major facility by itself.
(ii) A facility which is major for VOCs or NOx is considered major for ozone.
(iii) A facility which emits, or has the potential to emit, 25 tpy or more of NOx or VOC and is located in Bucks, Chester, Delaware, Montgomery or Philadelphia Counties.
Major modification--
(i) A physical change at or change in the method of operation of a major facility that results in:
(A) An increase in emissions of a regulated NSR pollutant equal to or exceeding the emissions rate that is significant as specified in this section.
(B) A significant net emissions increase of that pollutant from the major facility.
(ii) A significant emissions increase from an emissions unit or net emissions increase at a major facility that is significant for VOCs or NOx is considered significant for ozone.
(iii) A physical change at or change in the method of operation of a major facility does not include:
(A) Routine maintenance, repair and replacement.
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