Slide 1

Report
NSR Rule Review and Guidance
25 Pa. Code, Chapter 121. General Provisions
Chapter 127 Subchapter E. New Source Review
The Allegheny Mountain Section of
the Air & Waste Management Association
March 13, 2008
Holiday Inn, Pittsburgh, PA
Virendra Trivedi, Chief, NSR/Title V Section
Division of Permits, Bureau of Air Quality
717-787-4325
[email protected]
1
What is New Source Review (NSR)?


NSR is a preconstruction permitting program
applicable to major new or modified major
stationary facilities.
NSR permitting has two different components which
address increased emissions of criteria pollutants
depending on the attainment designation of the area
in which the facility is located.
 Prevention of Significant Deterioration (PSD)
 Nonattainment New Source Review (NSR)
2
NSR Program

Federal PSD Reform regulations in 40 CFR 52.21
are adopted and incorporated by reference in their
entirety in the Pennsylvania Code.
 Title 25, Chapter 127, Subchapter D
 Effective in Pennsylvania as of March 3,
2003
NSR regulations at 25 Pa. Code Chapter 127,
Subchapter E were amended on May 19, 2007.
3
PADEP’s NSR regulations


These amended NSR requirements apply to an owner
or operator of a facility to which a plan approval will
be issued by the Department after May 19, 2007.
The final NSR regulations were submitted to the
United States Environmental Protection Agency
(EPA) on August 9, 2007, as an equivalency
demonstration and revision to the Pennsylvania State
Implementation Plan (SIP).
4
PADEP’s NSR regulations
(Continued)



Before you submit a plan approval application,
you must determine whether the NSR
regulations apply to the proposed project.
The term “project” means a physical change or
change in the method of operation of an existing
facility, including a new emission unit.
The term “emissions unit” is defined at 25 Pa.
Code §121.1. An existing emissions unit is a
part of a facility that emits or has the potential to
emit a regulated NSR pollutant and has existed
for more than 2 years.
5
What is a major facility?

The term “major facility” is defined at 25
Pa.Code Section 121.1. A major facility has the
potential to emit at least 100 tons per year (tpy) of
a regulated NSR pollutant. These thresholds have
been lowered to:
50 tpy for volatile organic compounds (VOCs) and
100 tpy for NOx in moderate nonattainment areas
 25 tpy for VOCs and NOx in severe nonattainment
areas.

6
Ozone Nonattainment Areas


Major facilities located in Philadelphia CMSA
(counties of Bucks, Chester, Delaware,
Montgomery or Philadelphia) are subject to the
requirements applicable to severe nonattainment
areas for ozone. [25 Pa. Code §127.203(b)]
The remainder of the state is treated as a
moderate ozone nonattainment area for VOCs
and NOx even though the counties are classified
as attainment or “basic” since Pennsylvania is
included in the Northeast Ozone Transport
Region. [25 Pa. Code §127.201(c)]
7
PM-2.5 Nonattainment Areas
EPA has indicated that you may continue to use PM-10
as a surrogate of PM-2.5
8
NSR applicability
An applicability determination is the process for
determining which new source requirements
apply to an existing major facility.
 An applicability determination consists of two
steps:
 Step 1: Emissions increase due to the project
 Step 2: Net emissions increase calculation
 The provisions in 25 Pa. Code Sections 127.203 and
127.203(a) outline NSR applicability requirements.

9
Step 1:
Emissions increase due to the project


The calculation of an emissions increase
due to the project depends on whether the
project includes new emissions units
or
existing emissions units.
You need to consider only the emissions
increases associated with the project, not
any emissions reductions.
10
Step 1:
Emissions increase due to the project


Physical change or change in method of
operation at existing emissions units:
 Baseline actual to projected actual emissions
 §127.203a(a)(1)(i)(A)
Construction of a new emissions unit
 Potential to emit (PTE)
 §127.203a(a)(1)(i)(B)
11
Baseline Actual Emissions
§127.203a(4)
PADEP NSR Approach

The average rate, in
tpy, during a
consecutive 24-month
period within the fiveyear period. The
Department may
approve a different
period within the last
10 years if it is more
representative of the
normal source
operation.
Federal NSR Approach

The average rate, in
tpy, during a
consecutive 24month period
selected by the
owner or the
operator within the
ten-year period.
(Non- EGU)
12
Baseline Emissions
PADEP NSR Approach

The same
consecutive 24-month
period shall be used
for all regulated NSR
pollutants unless the
owner or operator
demonstrates, that a
different consecutive
24-month period is
more appropriate.
(Continued)
Federal NSR Approach

A different
consecutive 24month period is
allowed for a
different pollutant.
13
Projected actual emissions
§127.203a(5)


Projected actual emissions is the maximum
annual rate in tpy at which an existing
emissions unit is projected to emit a
regulated NSR pollutant.
In projecting the emissions, you should
consider both the expected and highest
projections of the business activity that
could be expected to be achieved.
14
Projected actual emissions
(Continued)
PADEP NSR Approach


The projected
actual emissions
must be
incorporated into
the permit as an
emission limit.
The owner or
operator must
monitor the
emissions and
maintain records.
Federal NSR Approach


The projected actual
emissions are not
incorporated as a
permit limit.
The owner or
operator must
monitor the
emissions and
maintain records.
15
Product demand growth
§ 127.203a(a)(1)(i)(A) and § 127.203a(a)(5)(i)(C)
When you compare baseline actual
emissions to projected actual emissions,
you may adjust the projection to exclude
any portion of the emissions increase that
the changed unit(s)


could have accommodated during the 24month baseline period, AND
is unrelated to the change.
16
Final procedure of Step 1

Final procedure of Step 1 of NSR applicability is to
compare emissions increase in each regulated NSR
pollutant due to the project with the applicable
emissions rate listed in the definition of significant.

The applicable emissions rate listed in the definition of
significant is:
 40 tpy of VOCs or NOx (moderate nonattainment areas)
 25 tpy of VOCs or NOx (severe nonattainment areas)
 15 tpy of PM-10
17
Final procedure for Step 1
(Continued)


Emissions increase due
to the project ≥ the
applicable emissions rate
that is significant; use
provisions of
§127.203a(a)(1)(ii) to
calculate net emissions
increase.
Note: this approach is
similar to the Federal
NSR provisions.

Emissions increase
due to the project <
the applicable
emissions rate that is
significant; use
provisions of
§127.203a(a)(2) to
calculate net
emissions increase.

De minimis emissions
increase calculation.
18
Step 2: NSR Applicability

In the second step of a NSR applicability



calculate the net emissions increase either
using provisions of §127.203a(a)(1)(ii) [similar to
Federal NSR] or §127.203a(a)(2) [De minimis
emissions increase] ; and then
compare it with the applicable emissions rate
that is significant
The second step of applicability for the
facilities located in Philadelphia CMSA is
different than the rest of the Pennsylvania. [25
Pa. Code §127.203(b)]
19
Similar to the Federal NSR provisions
Step 2: Net Emissions Increase Calculation
Provisions of §127.203a(a)(1)(ii)
Emissions increase due to the project ≥ the applicable
emissions rate that is significant
Net emissions increase =
Increase in emissions due to the project
Plus
Other increases in actual emissions occurring
within the 5-year period.
Minus Other creditable decreases in actual emissions
occurring within the 5-year period.

The 5-year period includes 5 years before construction on the
project commences and the date that construction on the
20
project is completed
Similar to the Federal NSR provisions
Step 2: Compare the calculated net emissions
increase with the applicable significant rate

If the net emissions increase ≥ the applicable
emission rate that is significant, the proposed
project is subject to the following NSR
requirements:




Emissions Offset
Lowest Achievable Emissions Rate (LAER)
Alternative Analysis
If the net emissions increase < the applicable
emission rate that is significant, the proposed
project is not subject to the NSR requirements.
21
De minimis emissions increase
Step 2: Net Emissions Increase Calculation
Provisions of §127.203a(a)(2)
Emissions increase due to the project < the applicable
emissions rate that is significant
Net emissions increase =
Proposed de minimis emissions increase
due to the project
Plus
Other previously determined increases
that occurred within 10 years period.
Minus Other creditable decreases in actual
emissions that occurred within 10 years
period.
22
De minimis emissions increase
Step 2: Compare the calculated net emissions
increase with the applicable significant rate
§127.203a(a)(2)


If the net emissions increase ≥ the applicable
emission rate that is significant
 only the emissions offset requirements
apply to the net emissions increase
 the proposed project is not subject to the
LAER requirements
If the net emissions increase < the applicable
emission rate that is significant
 the proposed project is not subject to the
NSR requirements.
23
Example
(Moderate Area)
Existing NOx major facility proposed to construct a new
Boiler D in 2008. Facility also proposed to replace Boiler
C with Boiler D
Potential to emit (PTE) of a new Boiler D = 39 tpy of NOx
Average actual emission of Boiler C = 30 tpy of NOx
Facility added a Boiler B in 2005 (PTE) = 19 tpy of NOx
Facility added a Boiler A in 1999 (PTE) = 20 tpy of NOx
Step 1: Emissions increase from the new Boiler D (39
tpy of NOx) is less the applicable emissions rate that is
significant (40 tpy of NOx); therefore we will use the
provisions of §127.203a(a)(2) to calculate net emissions
increase.
24
Example
(Continued)
Step 2
De minimis emissions increase calculation
Net emissions increase =
Proposed de minimis emissions increase
due to the project [39 tpy (Boiler D)]
Plus
Other previously determined increases
that occurred within 10 years period.
[20 tpy (Boiler A) + 19 tpy (Boiler B) = 39 tpy]
Minus Other creditable decreases in actual
emissions that occurred within 10 years period.
[30 tpy (Boiler C)]
= 39 tpy + 39 tpy – 30 tpy = 48 tpy
25
Example
(continued)
Step 2: The net emissions increase (48 tpy
of NOx) is greater than the applicable
emission rate that is significant (40 tpy of
NOx) therefore:


the owner or operator of the facility needs to
provide 55.2 tpy (48 * 1.15) of NOx ERCs
Boiler D is not subject to LAER requirements
26
Creditable emission decreases
or ERC
Creditable emissions reduction or ERCs shall
be:
Surplus
 Permanent
 Quantifiable and
 Federally Enforceable

[25 Pa. Code Section 127.207(1)]
27
Major or Minor Source ERC
Generation Techniques






Shutdown of an existing source or a facility
Permanent curtailment of production or operating hours.
Improved control measures including improved control
of fugitive emissions
New technology and materials
New process equipment
Economic Incentive Program, Mobile Emission
Reduction Credit Program, Airport Emission Reduction
Credit Program
[25 Pa. Code Section 127.207(5)]
28
ERC: Amnesty period
Expiring on May 19, 2008


Section 127.206 (r) provides a one-year
amnesty period for the owner or operator of a
facility, which has generated emission
reductions for all criteria pollutants after
January 1, 2002, to submit ERC registry
applications to the Department for approval.
Any facility owner or operator that missed the
deadline to submit applications is given an
opportunity to generate ERCs if the reductions
are surplus, permanent, quantifiable and
federally enforceable.
29
ERC Registry Application
§127.207 (2)

ERC registry application shall be submitted to the
Department within 2 years of the initiation of an
emissions reduction used to generate ERCs. For
deactivated sources or facilities, the following shall apply:
 Submit a written notice within 1 year after the
deactivation of a source or facility to request
preservation of the emissions in the inventory.
 Submit a maintenance plan in accordance with
§127.11a or §127.215 (relating to reactivation of
sources; and reactivation)
30
Use of ERCs
ERCs may be used to:

satisfy NSR emission offset ratio requirements;
“net-out" of NSR at ERC-generating facilities;
sell or trade the ERCs for use as emission offsets at
new or modified facilities.

Pennsylvania has Reciprocity Agreements with
New York and Maryland to allow interstate ERC
trades.
31
ERCs Status




Since 1994, more than 201companies have
submitted ERC registry applications.
DEP has certified a total of 27,708.9 tpy of NOx,
12,872.3tpy of VOCs, and 1,156.27 tpy of PM10
ERCs.
DEP has approved requests for trading of a total
14,596.5 tpy of NOx credits and 7,248.57 tpy of
VOCs ERCs.
Currently, the ERC registry system has 13,112.4
tpy of NOx, 5,394.73 tpy of VOCs and 357.46 PM10 credits available to use.
32
Plantwide Applicability Limit
(PAL)
§127.218
PAL is an alternative approach for
determining major NSR applicability.
A PAL is an annual (facility-wide) emission
limit (12-month rolling total, rolled monthly)
under which the facility can make changes
without triggering NSR review for that
pollutant.
 Pollutant-specific
 10-year term.
33
Establishing a 10-year PAL
§127.218(f)




Determine baseline actual emissions for all
existing emissions units using the same
consecutive 24-month period for all units. A
different 24-month period may be used for each
different PAL pollutant.
Add the pollutant-specific emissions rate that is
significant to the baseline actual emissions for
the PAL pollutant.
Subtract any emissions from emissions units that
operated during the 24-month period and have
since been permanently shut down.
Add the PTE for any emissions unit that was
added to the major facility after the selected 24month period.
34
New sources installed under PAL
§127.218(g)(10)


Owners or operators of new sources or emission units
added under an existing PAL must reduce or control
emissions from new sources by using the best available
technology (BAT) for new sources, as authorized under
section 6.6(c) of the APCA
BAT will not be required for sources modified after the PAL
is established unless the cost of the modification
“… exceeds 50% of the fixed capital costs that would be
required to construct a comparable entirely new source.…”
35
PAL Renewal



§127.218(k)
An owner or Operator may apply for renewal at least 6
months, but not earlier than 18 months before the date
of permit expiration.
If the emissions level from the facility is “equal to or
greater than 80 percent of the PAL level, then PAL may
be renewed at current level.
If the emissions level from the facility is less than 80
percent then:

The PAL may be established at a level that is more
representative of baseline actual emissions, or a level that is
appropriate based on air quality needs or other
considerations.
36
PAL Expiration



§127.218(j)
Within the timeframe specified for PAL
renewals, the facility owner or operator shall
submit a proposed allocation of the PAL to each
emissions unit.
The Department will decide whether and how the
PAL will be distributed and issue a revised
permit incorporating allowable limits for each
emissions unit.
Any subsequent physical or operational change
at the facility will be subject to major NSR
review.
37
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