ALL4’s Texas 2021 Look Ahead

Goodbye 2020! There has never been a year that literally everyone is unanimously looking to put in the history books and move on.  2020 brought so many challenges to many (all) of you, both personally and in your line of work.  We truly hope each of you made it through the year as best you could and that 2021 is off to a better start.  We’d be remiss not to thank our clients that we’ve been able to work with this past year.  We appreciate you in a normal year and are extra appreciative of you for the work we did with you in 2020.

2020 wasn’t all bad.  We saw a few glimmers in the Texas air quality world, including the Texas Commission on Environmental Quality’s (TCEQ’s) finalization of at-risk construction for minor New Source Review (NSR) amendments as well as the introduction of a petition to bring the Federal NSR Project Emissions Accounting (PEA) to Texas.  Let’s dust off our “crystal ball” and see what 2021 may have in store for us.

• Proposed Project Emissions Accounting (PEA) Change
• Proposal for Penalty Policy Revision
• Potential Reclassification for Ozone Nonattainment Areas?
• 87th Legislative Session
• Stormwater Multi-Sector General Permit Renewal
• Proposed 2021 Regional Haze State Implementation Plan (SIP) Revision
• More Air Permit Applications can be submitted via STEERS
• Changes to General Operating Permits (GOP)
• What’s new with ALL4?

Proposed Project Emissions Accounting (PEA) Change

On October 22, 2020, the U.S. EPA signed the PEA rule for NSR [nonattainment new source review (NNSR) and Prevention of Significant Deterioration (PSD)] permitting was finalized.  PEA allows both emissions increases and decreases from a major modification at an existing source to be considered during Step 1 of the two-step NSR applicability test.  This process is known as project emissions accounting (previously referred to as project netting).  However, 30 TAC §116 does not fully support the concept of PEA.

In the past year or so, TCEQ has received a petition for rulemaking.  The TCEQ air staff and commissioners recognize the use of PEA is vital for industry in Texas and as such have proposed changes to match the Federal requirements.  On December 18, 2020, TCEQ published a proposal “New Source Review (NSR) Repeal of Obsolete Rules and Project Emissions Accounting (PEA) (Rule Project No. 2020-001-116-AI).”  This proposal would amend various sections of 30 TAC §116 to be consistent with U.S. EPA’s PEA rule.  To be specific, it would repeal outdated sections, add additional rules as necessary, and remove or update cross-references to the rules which are being repealed.  The public comment period for this proposal ends on February 3, 2021.  The anticipated rule adoption date is June 9, 2021.

ALL4 recommends that owners and operators who are considering capital projects and changes to their operations, keep a close eye on the rulemaking and consider submitting comments in support of the rulemaking.  The use of PEA for a project could potentially avoid PSD or NNSR in some cases and thus simplify permitting (and the timeline to receive a permit).

Proposal for Penalty Policy Revision

TCEQ’s penalty policy has not been changed since April 1, 2014.  Over the years, statutory changes have occurred, and recent environmental incidents have caused significant impacts to the public.  As a result, TCEQ proposed a penalty policy revision in late 2020.  The proposal went through the public comment period, ending on October 30, 2020.  Comments received after the deadline will be considered by the commission at a later work session.

The proposed changes significantly increase deterrence to future noncompliance by amending factors within the policy that may impact the assessment of administrative penalties.  For example, the statutory maximum penalty for major sources actual release events resulting in moderate and minor harm will increase from 30 to 50% and 15 to 30%, respectively.  Reportable emissions events that occur in a county with a population of 75,000 or greater would now receive a 20% upward adjustment to the base penalty.

Owners and operators need to take note of this proposal, confirm appropriate environmental compliance practices in daily operations, and recognize that penalties for non-compliance will come at an increased expense (i.e., consider increasing your environmental compliance budget).

Potential Reclassification for Ozone Nonattainment Areas?

You may remember that the Houston-Galveston-Brazoria (HGB) and Dallas-Fort Worth (DFW) areas were reclassified from “moderate” to “serious” ozone nonattainment for the 2008 eight-hour ozone National Ambient Air Quality Standards (NAAQS) on September 23, 2019. Is it possible that this could change again?

The HGB and DFW ozone reclassification was documented in Federal Register Vol 84, No. 164 on August 23, 2019.  The attainment date for “serious” ozone nonattainment areas is July 20, 2021, with a possibility of a one-year extension under some circumstances.

TCEQ, as well as U.S. EPA, use the monitored data local to each of the areas to determine attainment status.  The latest monitored data for the HGB and DFW areas are not very promising.  The 2018 – 2020 three-year average concentration for DFW is 76 parts per billion (ppb), and the 2018 – 2020 three-year average concentration for HGB is 79 ppb.  Both are above the 2008 eight-hour ozone NAAQS of 75 ppb.  Although the data is incomplete and certification is needed, it does point to a trend of continued nonattainment.  Therefore, it is possible that TCEQ and U.S. EPA could evaluate the situation and need to bump up the ozone nonattainment designation from “serious” to “severe” for DFW and HGB.

Since HGB and DFW have gone through the change from “moderate” to “serious,” most owners and operators are likely aware of the air permitting impact (e.g., lower NNSR triggering thresholds, higher offset ratios for NNSR projects, lower Title V Operating Permit thresholds, etc.) and have planned ahead.  If the areas were to be reclassified as “severe,” industry should be aware of several challenges:

• A decrease in the NNSR major source threshold for ozone precursors NO_x and VOC from 50 tons per year (tpy) to 25 tpy. Note that the major modification significant level does not change and remains at 25 tpy whether classified serious or severe nonattainment.
• A higher minimum offset requirement, increasing from a ratio of 1.2:1 to 1.3:1. Emission reduction credits (ERC) and allowances may become more scarce and therefore the cost to offset a project may increase two fold, from the cost to purchase ERC or allowances and from being required to purchase more due to the increased offset ratio.
• Additional sites may be required to operate pursuant to Title V Operating Permits as VOC and NO_x thresholds decrease from 50 tpy to 25 tpy.
• Additional State Implementation Plan (SIP) requirements including a vehicle mile traveled (VMT) offset, low VOC reformulated gas, and a penalty fee program for major sources.

Industry should keep an eye out as the monitoring data is quality assured and certified to see how DFW and HGB fare as we near the July 2021 attainment date.  As the data becomes clear, industry should consider timing of projects relative to a potential downgrade in nonattainment status.

87th Legislative Session

It’s hard to believe that it’s time for the next Texas Legislative Session already.  The 87th Texas Legislative Session kicked off on January 12, 2021 in Austin and runs through May 31, 2021.  Last session laid the groundwork for TCEQ’s at-risk construction for minor NSR amendments, enhanced TCEQ’s expedited air permitting program, among others.

What will this session bring from an environmental perspective?  It’s too early to tell however multiple bills with environmental implications have already been introduced and it’s anticipated many more will be.  Current bills cover topics including environmental justice, climate change, the contested case hearing process, and storage tanks (and as usual quite a few related to concrete/aggregate operations).  Stay tuned as the session progresses.  Want to refresh your memory on the legislative process or the results of the last session?  Refer to ALL4’s articles from the 86th Legislative Session:

• What Happened: Air Quality Bills to Watch in the 86th Texas Legislative Session
• The 86th Texas Legislative Session: The Process and Implications for Texas Facilities with Air Permits

Stormwater Multi-Sector General Permit Renewal

The current Stormwater Multi-Sector General Permit (MSGP) (TXR05000) for industrial facilities expires on August 14, 2021 and TCEQ has begun the renewal process.  On December 11, 2020, TCEQ published the notice of the proposed 2021 Stormwater MSGP in the Texas Register and in several newspapers across Texas and is wrapping up taking public comments.  The TXR05000 permit effective date is August 14, 2021 and facilities must submit their permit renewal application to TCEQ by November 12, 2021 (within 90 days from effective date).

Proposed 2021 Regional Haze State Implementation Plan (SIP) Revision

On October 7, 2020, TCEQ approved a proposal of the 2021 Regional Haze SIP Revision (Project No. 2019-112-SIP-NR).  The proposed SIP revision would demonstrate compliance with the regional haze requirements of the Federal Clean Air Act, §169A and the U.S. EPA’s Regional Haze Rule for the second planning period.  The proposal package follows TCEQ’s 2020 air dispersion modeling efforts of SO₂ and NO₂ from chosen sites as well as outreach to the modeled sites.  The proposed SIP revision addresses regional haze in Big Bend and Guadalupe Mountains National Parks in Texas and Class I areas located outside Texas that may be affected by emissions from within the state.  The deadline for receipt of written comments on the proposal was January 8, 2021.

The purpose of this SIP revision is to demonstrate to U.S. EPA how Texas will reduce regional haze in the air to natural background conditions.  The results of TCEQ’s analysis showed that no additional control of sources is needed.  Next up, U.S. EPA will review TCEQ’s proposed package.

More Air Permit Applications can be submitted via State of Texas Environmental Electronic Reporting System (STEERS)

In the past several years, STEERS has evolved into a portal for submitting some simple air permit applications such as permit by rule (PBR) and standard permits. Starting January 1, 2021, more complicated permits and registrations will be able to be submitted in STEERS. Below is a summary of all newly allowed permit types that can be submitted via STEERS.

• NSR Case By Case Permits (all action types)
  • Minor NSR
  • Special Permit
  • PSD
  • Nonattainment
  • Flexible
  • Greenhouse Gas (GHG) PSD
  • The following should be submitted through STEERS if submitting concurrently with a minor NSR permit application. If submitting as a stand-alone permit action, continue to email the application to apirt@tceq.texas.gov:
    • GHG PSD: Voluntary Update
    • Plantwide applicability limit (PAL): Initial, Amendment, Alteration, Renewal, Renewal/Amendment,
    • Hazardous air pollutant (HAP) Major Source: Initial, Major Modification

• Standard Permit Registrations (all action types):
  • Concrete Batch Plants
  • Temporary and Permanent Hot Mix Asphalt Plants
  • Temporary and Permanent Polyphosphate Blenders

In addition to the permit type updates, the TCEQ ePay now allows customers to pay fees by credit card up to a maximum amount of $80,000, effective October 1, 2020.  This change makes it much easier to pay for permit application fees.  Bottom line: TCEQ continues to move towards a more electronic approach, both with payment and submittal of construction permit applications.  While we remain in a pandemic with many environmental professionals (industry, agencies, consultants) continuing in a work from home environment, this increased electronic approach appears to be a good way to keep permitting flowing at TCEQ.

Changes to General Operating Permits (GOPs)

For Title V operating permits, TCEQ recently has made some changes to certain GOPs.  On October 15, 2020, the TCEQ issued renewed Oil and Gas GOPs Numbers 511, 512, 513, and 514.  The draft GOPs contain revisions based on recent federal rule changes, which include updates to 40 Code of Federal Regulations Part 60, Subpart OOOOa published in the 9/14/2020 and 9/15/2020 Federal Register.  The revisions also corrected typographical errors and updated language for administrative preferences.  The public comment period for these GOP changes ended on December 16, 2020.

TCEQ also drafted Air Curtain Incinerator (ACI) GOP Number 518. In addition to the federally required renewal, the draft GOP contains revisions resulting from amended federal rules.  This renewal also includes administrative language updates.  The comment period for GOP 518 ended on January 7, 2021.

Owners and operators who are potentially affected by these GOP changes need to watch the progress of them closely.  In general, affected sites need to submit an authorization to operate (ATO) as part of permit revisions within 90 days after the finalized effective dates of these GOPs.

What’s new with ALL4?

ALL4 continued to grow through 2020, closing two acquisitions (in Kentucky and Philadelphia), and several environmental, health and safety professionals have joined the team.  ALL4 added staff in each of our Georgia, Kentucky, North Carolina, Pennsylvania, Texas, and Washington D.C. Offices as well as staff throughout the country that work remotely.  With our growth and addition of talent, ALL4 now provides comprehensive EHS services.

With growth come opportunities, and we’re hiring for several key positions, including our Houston Office Director role.  Looking for a leadership role?  Know someone who may be a good fit?  Check out the role.  (Don’t worry, current Houston Office Director, Kristin Gordon, isn’t going anywhere!  In a new role, she’ll continue to focus on our clients and the regulatory challenges they face.)

If you have questions on any of the topics above and/or know of talented environmental professionals looking for a growth oriented company to build a career at, please reach out: Kristin Gordon (kgordon@all4inc.com or 281.937.7553×301) or Meghan Skemp (mskemp@all4inc.com or 281.937.7553×307).