Project Emissions Accounting Under New Source Review Permitting

In March of this year, the U.S. Environmental Protection Agency (U.S. EPA) issued a new interpretive policy memorandum concerning how emissions increases are to be determined in Step 1 of New Source Review (NSR) permitting.  The NSR regulations include the Prevention of Significant Deterioration (PSD) regulations for areas in attainment with the national ambient air quality standards (NAAQS) and the nonattainment new source review (NNSR) regulations for areas that are classified as nonattainment with one or more NAAQS.  If you recall, the applicability of NSR major modification provisions for changes at existing major stationary sources are triggered when the emissions associated with a given project reflect both a “significant emissions increase” and a “significant net emissions increase”.  There is currently a two-step process to determine applicability: “Step 1” considers the emissions increases associated with a given project and “Step 2” considers site-wide contemporaneous emissions increases and decreases, provided the emissions increase determined during Step 1 is significant.

The new interpretive policy memorandum issued by U.S. EPA is focused on one important issue; how project emissions increases are accounted for during Step 1, when considering only emissions associated with a proposed project.  NSR applicability (or non-applicability) can be a contentious subject and beyond the scope of this article, as are the nuances of the federal and state-specific PSD and NNSR programs in general. Instead, the focus of the article is on the important change that U.S. EPA presents in their new policy, that is, the ability to account for and use emissions decreases in Step 1 of the NSR applicability test.  This policy change is very critical when determining whether there is a Step 1 significant emissions increase for a project that would trigger the consequences of major NNSR requirements (e.g., Lowest Available Emission Rate (LAER) control technology and emissions offsets) or PSD requirements (e.g., Best Available Control Technology (BACT) and air quality modeling).

Timeline of NSR Permitting Rules

When U.S. EPA originally proposed the NSR reform rules (i.e., 2002), the discussion of project emissions increases included both emissions increases and decreases from a given project.  For example, if a facility was replacing a boiler, they could count the potential-to-emit (PTE) emissions increase from a new, more efficient boiler and subtract the actual emissions decreases from the old, higher-emitting boiler being replaced.  However, when U.S. EPA adopted revisions to the NSR rule in 2006, they decided that Project emissions decreases could not be accounted for until Step 2.  This was a very important distinction.

This 2006 revision was based on U.S. EPA’s legal interpretation that the phrase “sum of the difference” does not appear in Clause (j) of 40 CFR §52.21(a)(2)(iv) of the NSR permitting rules.  This omission, and the fact that Clause (j) speaks of the “sum of the emissions increases,” led U.S. EPA to assert in 2006 that emissions decreases in a Project could not be accounted for during Step 1 emissions accounting.  While this was a U.S. EPA legal interpretation, this did not really make sense to many from a practical point of view based on the intent of the 2002 NSR revisions when determining the actual emissions increases from a Project.  Think back to the example of the replacement of an older, high-emitting boiler with a new, more efficient boiler.  Not allowing for the accounting of emissions decreases associated with a Project in Step 1 greatly increases the likelihood that NSR permitting will be triggered when considering facility-wide contemporaneous emission changes during Step 2.

It is well documented that the 2006 interpretation by U.S. EPA led to many projects involving the installation of cleaner emitting sources being cancelled, primarily due to the costly delays that would result if NSR permitting requirements were triggered.  This particular aspect of NSR permitting has been one of the most significant complaints about the NSR permitting applicability analysis because many environmentally beneficial projects involving the replacement of older, more polluting equipment with new, more efficient and less polluting equipment were not pursued.  Similarly, facilities contemplating projects intended to displace higher polluting fuels with cleaner burning fuels (i.e., natural gas) were also discouraged due to NSR concerns.  Overall, the 2006 interpretation of the Step 1 NSR applicability test by regulatory agencies has stymied projects that would have resulted in process efficiency gains and emissions decreases, which are actually good for the environment and good for the economy.

As part of the strategy to reduce the regulatory burden on U.S. industry, the U.S. EPA decided to take a hard look at the NSR regulations and ultimately to review the Agency’s previous 2006 decision that disallowed project emissions decreases in Step 1 and has now determined that there is a legal basis for allowing project emissions decreases to be accounted for in Step 1.   While this decision immediately affects State and local agencies that adopt the Federal NSR regulations for PSD permitting directly within their regulations, many state and local agencies implement their own versions of these regulations.  For most agencies, the NNSR permitting regulations represent State-specific requirements.  State and local agencies are allowed by Federal rule to be more stringent than the Federal rules, but not less.  Therefore, the NSR permitting assessment conversion to accounting for Step 1 emissions decreases may take some time for regulatory development and adoption at the State and local level.  Additionally, the agencies may not want to adopt all of the U.S. EPA rules for accounting Project emissions decreases.  Also note that the currently proposed affordable clean energy (ACE) rule includes a proposed new twist or two for electric generating units related to NSR applicability, which we will discuss another day.

If you are considering embarking on a Project that may trigger NSR permitting, it would be prudent to do an upfront permitting strategy review to see whether you can take advantage of this new Project emissions accounting methodology in your area.  We will continue to keep you updated as U.S. EPA’s reform activity continues.  If you have any questions, feel free to contact me at jslade@all4inc.com or 717-822-0009.

Subpart MM for Pulp and Paper Mills – Worst Anniversary Gift Ever?

October 11 is a memorable date for me because it’s my wedding anniversary – this year is especially memorable because it marks 10 years!  But my 11^th anniversary will be memorable for pulp and paper mills across the country, as October 11, 2019 is the compliance date for the amended provisions of 40 CFR Part 63, Subpart MM (National Emission Standards for Hazardous Air Pollutants for Chemical Recovery Combustion Sources at Kraft, Soda, Sulfite, and Stand-Alone Semichemical Pulp Mills).

Although a year away, the compliance date is practically around the corner due to the shortened two-year compliance timeline.  Only two years were provided for mills to come into compliance since the numerical emissions limits and electrostatic precipitator (ESP) parameter monitoring requirements did not change (i.e., U.S. EPA did not anticipate the amendments to require any capital projects such as ESP upgrades).  However, we’ve identified several provisions that will clearly impact how mills comply with the rule, and several other provisions that are not so clear and will require some time to figure out.  It’s important to understand how your mill will comply and what actions need to be taken now to ensure compliance is achieved by October 11, 2019.

Here are a few suggestions for beginning to understand your mill’s status and establishing a compliance strategy:

1. Review your permit. Understand how Subpart MM is currently addressed and how it may need to change.  Is it incorporated by reference, copied word for word, or customized by your state agency?  If provisions in the amended rule are different than your permit, how should your permit be revised to reflect future compliance obligations?

2. Identify your permit’s expiration date. If your permit expires three years or more from the October 11, 2017 promulgation date (i.e., October 11, 2020 or later), it must be reopened to address the new applicable requirements within 18 months of promulgation (i.e., by April 11, 2019).  Here’s a helpful blogpost on evaluating your options.  If you’re not required to reopen your permit, are there advantages to incorporating the changes sooner than later?

3. Review your current reporting practices. Reporting obligations will shift from quarterly to semiannually.  With a compliance date in the fourth quarter of 2019, how will you address the first semiannual report?  Are you prepared to quantify emissions for each failure to meet an emissions limit or operating limit?

4. Review the reporting template. As with most rule amendments these days, Subpart MM now requires electronic reporting via U.S. EPA’s Compliance and Emissions Data Reporting Interface (CEDRI).  Mills should already be familiar with submitting electronic Notifications of Compliance Status (NOCS) and test results from other rules, but semiannual reports under Subpart MM will need to use the prescriptive “form” (i.e., spreadsheet) provided by U.S. EPA.  The latest version of the reporting spreadsheet is available in the rule docket.

5. Review your historic opacity measurements. The monitoring parameter allowances for opacity from recovery furnaces and lime kilns equipped with ESPs are decreasing (but also shifting to a semiannual basis).  Based on what you’ve historically reported, would your mill comply with the new allowances?

6. Review your current continuous monitoring practices. Subpart MM now references Performance Specification 1 for COMS.  Does your COMS currently comply with PS-1?  Does it need to?  How do your current monitoring parameters compare with the rule’s new monitoring requirements, such as for Automatic Voltage Control (AVC)?  What changes are needed to your DAS to account for periods of startup and shutdown and the new opacity allowances?

7. Review your historic test data. Although the numerical emissions limits did not change, repeat performance testing is required by October 13, 2020 (yes, a year later than the compliance date).  Some of the sources required to be tested may not have been tested for some time.  What do your past results look like?  Do those sources operate in a similar manner now or would you expect the results to be different?

8. Document your decisions. There are provisions of the rule that require some level of interpretation, so when you come across something in the rule that is not clear (and you will), be sure to document the justification behind your compliance approach.  For example, what types of records will you keep?  Are your 3-hour averages on a rolling or block basis?

There is plenty more to evaluate, but taking the steps above is a good place to start.  We’re prepared to help you with any or all of these steps and more to understand how the Subpart MM amendments will impact your mill, well before my 11^th anniversary next year.  Hopefully my husband will get me something better than an amended air quality regulation.

Contact me at lkroos@all4inc.com or 610.933.5246 x122 with questions!

The Complexities of a Texas SIP Revision

The Texas Commission on Environmental Quality (TCEQ) approved the proposal of a State Implementation Plan (SIP) Revision for the Houston-Galveston-Brazoria (HGB) ozone nonattainment area.  The proposed SIP revision requests that the U.S. EPA redesignate the area to attainment for both the one-hour and 1997 eight-hour ozone National Ambient Air Quality Standard (NAAQS) and approve a maintenance plan through 2032.  TCEQ opened the public comment period on September 7, 2018 and closed it on October 8, 2018.  At face value, the proposed SIP revision would not appear to be controversial as SIP revisions are approved by TCEQ regularly (U.S. EPA approval of proposed SIP revisions, not so regularly).  While the proposal of a SIP revision related to the ozone NAAQS is not typically newsworthy, the background and circumstances around this proposed SIP revision are a little more complex than normal.

The situation in the HGB area illustrates both the technical and regulatory challenges facing regulatory agencies and the regulated community with regard to a heavily industrialized area, historical ozone NAAQS designations, evolving air quality standards, ambient air monitoring data, anti-backsliding provisions, regulatory revisions, court cases, and interested third party non-governmental organizations (NGO).  In this scenario, the HGB area is currently classified by U.S. EPA as a severe ozone nonattainment area for the one-hour ozone NAAQS of 0.12 ppm (revoked) and the 1997 eight-hour ozone NAAQS of 0.08 ppm (revoked).  However, ozone monitoring data indicate that the HGB area is attaining both the one-hour and eight-hour ozone NAAQS since at least 2014.  Due to anti-backsliding provisions, the severe nonattainment designation persists for HGB even though ambient air monitoring data support an attainment designation.  A severe nonattainment designation for an area impacts how new facilities and modifications at existing facilities are permitted under the Texas nonattainment new source review (NNSR) regulations.  The impacts include lower major source and significant thresholds, lowest achievable emission rate (LAER) requirements, and higher emission offset ratio requirements.

Using a provision of the federal 2008 ozone standard SIP requirements rule, the TCEQ in 2014 and 2015 submitted “Redesignation Substitute Reports” to redesignate the HGB area for the one-hour and 1997 eight-hour standards, respectively, to formally redesignate the area and to remove anti-backsliding provisions for the revoked standards.  Both submittals were approved by U.S. EPA, leaving the HGB area with a moderate ozone nonattainment designation under the 2008 eight-hour ozone NAAQS.  The moderate ozone nonattainment designation meant that facilities in the HGB area had a bit more certainty and a little NNSR permitting breathing room with regard to new construction and modifications until earlier this year.

Recall that the provision for the HGB designation change and lifting of anti-backsliding provisions was based on the 2008 ozone standard SIP requirements rule, which was challenged by the California South Coast Air Quality Management District.  A decision by the United States Court of Appeals for the District of Columbia Circuit vacated parts of the federal final 2008 ozone standard SIP requirements rule, including the parts of the rule that the TCEQ relied on for the 2014 and 2015 redesignation requests to U.S. EPA.  The vacatur ruling, as it stands, extends regulatory uncertainty to the regulated community in the HGB area related to air quality permitting requirements, including whether the severe NNSR permitting requirements are back in place or not.  U.S. EPA, to date, has not provided SIP planning guidance to states to reflect the decision of the Court.  To top things off, several regional and national NGOs have challenged the HGB redesignation substitutes based on the Court’s decision.

To address the ongoing uncertainty faced by the regulated community and as a hedge position, TCEQ developed the proposed formal redesignation request and maintenance plan SIP revision for the HGB area for the revoked one-hour and 1997 eight-hour ozone NAAQS.  TCEQ acknowledges that the U.S. EPA has not historically formally redesignated areas for NAAQS that have been revoked but speculates that if the Court’s South Coast decision stands, U.S. EPA would act upon a formal redesignation request.  One last complicating note – the U.S. EPA is expected to designate the HBG area as a severe ozone nonattainment area for the 2008 ozone NAAQS based on current monitoring data.

In the interim, regulated stakeholders would do well to lobby TCEQ for swift approval of its SIP proposal and then comment positively when, and the optimum word is when, U.S. EPA proposes action on TCEQ’s proposal.  Please contact me at (610) 933-5246, extension 127 or  rrakiewicz@all4inc.com if you have any questions.

TCEQ Air Quality 101 Blog Series – Back to School Edition

TCEQ Updates: New Chairman, Modeling and Effects Review Applicability (MERA), and Effect Screening Levels (ESL)

With summer having come to a close and students heading back to the classroom, it’s an appropriate time to do some fall refreshing and reflecting.  Not surprisingly, there have been several important updates in 2018 pertaining to air quality in Texas.  For this “Roundup-Style” September installment of our Texas Commission on Environmental Quality (TCEQ) Air Quality 101 Blog Series, we provide a brief overview of 2018 updates related to: Leadership Changes at TCEQ, Modeling and Effects Review Applicability (MERA) and the Effects Screening Level (ESL) Database.

TCEQ Leadership Changes

On August 31, 2018, Governor Greg Abbott designated Jon Niermann as the new TCEQ Chairman.  In addition to the new Chairman, Governor Abbott also appointed Emily Lindley as the new Commissioner of TCEQ.  As an “internal” hire, Mr. Niermann is not anticipated to change the direction of TCEQ.  Likewise, Ms. Lindley most recently served as Chief of Staff at the U.S. Environmental Protection Agency (EPA) Region 6 office in Dallas, but previously worked for TCEQ as a Special Assistant. These appointments coincide with the retirement of former Chairman, Dr. Bryan Shaw, who served as TCEQ Chairman for almost nine years.  The recent staff changes have been updated on the TCEQ organizational chart.   ALL4 will monitor how the new leadership will address air quality and air permitting challenges in Texas.

Please note that the act of changing leadership at TCEQ could impact the timing of a final permit being issued.  For example, a final pending air quality permit could be delayed while in the TCEQ “signature chain” because the TCEQ official permit letterhead may not reflect the most recent most recent appointments.  This is a rare occurrence, but valuable knowledge to have.

Updates to TCEQ Modeling and Effects Review Applicability (MERA)

ALL4 attended the TCEQ Environmental Trade Fair back in May 2018 where TCEQ presented updates to the MERA that were finalized in March 2018.  For those that may not be familiar, the MERA is found in the TCEQ Air Permit Reviewer Reference Guide (APDG) 5874 (Version 5, Revised 3/2018), located online here.  APDG 5874 states that “if there are no state or national ambient air quality standards for a contaminant, [Project-related emissions increases are] evaluated through the TCEQ’s MERA process.  During the MERA process, the scope of air dispersion modeling and effects review is determined” (APDG 5874 pg. 1).

The MERA process consists of eight steps.  Through these steps, the health effects of a certain air containment for a project are evaluated.  A MERA evaluation must be conducted for each contaminant that exhibits an increase in emissions rate from any emissions point because of a project.  Before the March 2018 MERA Guidance was finalized, the last update occurred in July 2009.  The changes highlighted by TCEQ in the new MERA include improved ease of use and clarity, removal of infrequently used steps, revision of the multi-point equation in (the previous) Step 5.  Chemical species with no ESL are now exempt from a MERA evaluation.

Regarding the MERA process in general, I would be remiss without sharing some tips and reminders that you can implement when completing a MERA analysis yourself.  While the bullets below only summarize some tips used for tanks emissions, I found them helpful to share:

• When calculating and modeling tank emissions do not forget to include individual ESLs for the components of the material in the tank. For example, when permitting a diesel fuel tank, evaluate the ESL for diesel fuel #2 along with the constituents (e.g., benzene, etc.) experiencing an emissions increase.
• When calculating and modeling tank emissions, be sure to consult APDG 6250 and APDG 6419 for fixed roof and floating roof tanks emission estimation methods, respectively. These are the same guidance documents that TCEQ permit reviewers use to evaluate emissions increases from tanks.
• If a MERA analysis is being conducted for an emissions point and a corresponding tank, remember to use the appropriate unit impact multiplier on the screening tables. For example, use the stack height for the emissions point and use the vent stack height for the corresponding tank to determine the maximum ground level concentration for each unit.
• If an annual operating limit is being proposed, be sure to annualize ground level concentrations. For example, for an annual emissions increase, convert the tons per year (tpy) emissions increase into a pound per hour (lb/hr) emissions rate to evaluate the maximum ground level concentration.

Updates to the ESL Database

Over the past year, TCEQ has (thankfully) streamlined the ESL Database.  In previous years, TCEQ would publish ESL Databases in the form of an Excel spreadsheet.  Each successive Excel spreadsheet was periodically published online.  The problem with this revision approach was that each successive Excel spreadsheet version would need to be re-issued in its entirety to reflect changes, revisions or updates. To avoid re-publishing multiple versions of Excel spreadsheets, TCEQ transitioned the ESL Database into an online dynamic database.  What does this mean for you?  It means there are more specific search options (i.e., effective dates, CAS#’s, etc.).  It also means that more steps are required to download the ESL Database.  While the steps to download the database are easy to follow, more stages are involved.  Users now need to download the database via a text file, convert this text file into an Excel spreadsheet, finalize filtering options using a “text-to-columns” function, and then format the spreadsheet.  While this may seem tricky, it is not too complicated.  If you need any assistance walking through the steps, feel free to give me a call.

I hope you enjoyed reading the “Back-to-School” edition of our TCEQ Air Quality 101 Blog.  Don’t worry there’s no homework on your end, except if you do have questions on this blog, be sure to reach out to me using my phone number 281-937-7553 x302 or my email fdougherty@all4inc.com.  Thanks for reading.

What Makes You So Special?

We are in the thick of completing college application essays in my household. It’s proven to be an overwhelming task, particularly to my high school senior who is feeling the pressure of trying to write something that will differentiate him from hundreds of other applicants. Maybe some of you can relate.  It’s a stressful exercise and one that has generated a good deal of self-reflection for my son, but ultimately has provided clarity around what he values and who he is as a person.  So, it is likely not a coincidence that this self-reflection exercise has carried over into my professional life. As HR Director, it’s made me pause and reflect upon what I think differentiates ALL4 from other environmental consulting firms. Mind you, I’m an HR professional who fervently believes her company is the best in the business, but knowing who we are and what sets us apart is definitely worth thinking about.  ALL4 differentiates ourselves in many ways, but here are a few that really resonate with me.

First, our people set us apart both internally and externally.  We hire smart people who are deeply accountable. You’ve probably already read Anne Vitale’s “What’s Your One Thing” blog where she distinguishes that our employees strongly agree that we treat each other with respect and we will go the extra mile to achieve great results. That’s the internal culture. Externally, we repeatedly hear that clients value our technical expertise, strategic thinking, and responsiveness. They understand when ALL4 represents “we become our client” that we’re more than just a consultant. We are a part of their team.

The second differentiator, our Core Value of investing in others, is foundational to ALL4 and can be seen by employees communicating authentically via an open-door policy with our C-Suite; having junior staff members present and share their expertise at conferences; and encouraging all team members to participate in our robust cross-coaching program spanning function, geography, and position.  It’s enriching when technical people choose non-technical coaches because it makes space for an outside perspective that is focused on big picture objectives and not specific work tasks. Our current session has an Atlanta coach working with a coachee in Houston and a senior consultant being coached by a less experienced peer – this is where real growth takes place!  In a company where the people are your product, caring about and investing in them is the top priority and a responsibility that we take seriously. It manifests itself not only in our coaching culture, but in the flexible, fun, and beneficial workplace ALL4 has created.

At ALL4, individuals at any level have tremendous freedom to chart their own career path, fostered by an environment that values and promotes self-discovery. As a growing, entrepreneurial organization, ALL4 is not only committed to providing opportunities for our clients, but strongly encourages employees to create for themselves opportunities for professional growth and distinction. Being a growth mindset organization allows our employees to exercise creativity and flexibility to determine WHAT they want their professional journey to look like and HOW they want to reach their destination.  We provide a framework, but not a playbook, and employees consistently remind me that this is one of the tenets they appreciate most about ALL4.

Finally, when new hires share that the level of expectation around the detail and quality of our work product is higher than they ever imagined, I smile, knowing another differentiator is at play.  We unapologetically pursue excellence.  ALL4 believes we can always get better: as an employer, as trusted consultants, and as people.  We love being a company where employees can exercise their individual voice to influence the collective voice of the organization.  ALL4 has been fortunate to be the recipient of many awards including numerous Best and Brightest Companies to Work For^® designations, membership in the elite Inc. 5000 10X Club, and being named an Inc. Magazine Best Workplace of 2018 earlier this year.  For the 10^th consecutive year, ALL4 was recognized as a Pennsylvania Best Places to Work firm.  We are proud to have again received this distinction and are eagerly anticipating the awards ceremony to see if we snag the coveted number one spot this year.  But frankly, I want more than recognition as being a best place to work for; we are striving every day to be the number one company to work with.  We can achieve this because our people, our investment in others, the versatility of our career paths, and our unceasing focus on quality is the powerful foundation that differentiates us from the crowd.