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Greenhouse Gas Tailoring Rule

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  • 1. Air Quality Training Seminar Tony Owens John Egan Colin McCall ALL4 Inc. Alabama Center for Commerce Montgomery, AL December 7, 2010
  • 2. Training Seminar Agenda Greenhouse Gas Tailoring Rule 4 Rules Update Lunch Implications of the New NAAQS MACT SSM – The New Approach “Affirmative Defense” Radar Screen Issues
  • 3. Greenhouse Gas Tailoring Rule Tony Owens All4 Inc.All4 Inc. Air Quality Training Seminar Montgomery, AL December 7, 2010
  • 4. Agenda GHG Tailoring Rule Background • PSD Applicability and Requirements • Title V Applicability and Requirements • Impact on Permit Application Process • The Future? GHG Reporting Rule • Getting Ready to Report
  • 5. GHG Tailoring Rule Prevention of Significant Deterioration (PSD) and Title V Greenhouse Gas (GHG) Tailoring Rule. • Amends 40 CFR Parts 51, 52, 70 and 71 • Effective Date – August 2, 2010 • Sets timing and thresholds for addressing GHG emissions from stationary sources under Clean Air Act (CAA) permitting programs
  • 6. GHG Tailoring Rule 2007 Supreme Court decision in Massachusetts v. EPA found that U.S. EPA must determine if GHG emissions from motor vehicles contribute to air pollution. One year ago today U.S. EPA Administrator issued finding that GHGs endanger public health and welfare. (Happy Anniversary!) April 2010 Light Duty Vehicle Rule established GHG emission standards. GHGs become “subject to regulation” under the CAA on January 2, 2011. U.S. EPA concludes that regulating GHG tailpipe emissions triggers regulating GHGs under major source permitting programs (PSD and Title V).
  • 7. GHG Tailoring Rule Major source permitting program emission thresholds are 100 and 250 tons per year (tpy). • Tens of thousands of new PSD permits • Millions of new Title V permits GHG Tailoring Rule “tailors” these requirements to limit facilities required to get permits for GHG emissions.
  • 8. GHG Tailoring Rule GHG Tailoring Rule is implemented for the largest sources of GHG emissions in two (2) steps: • Step 1 – January 2, 2011 to June 30, 2011 • Step 2 – July 1, 2011 to June 30, 2013 U.S. EPA will begin rulemaking in 2011 to establish requirements for smaller sources. In general, sources with GHG emissions below 50,000 tpy of carbon dioxide equivalent (CO2e) will not be regulated for at least six (6) years.
  • 9. GHG Tailoring Rule For PSD and Title V, GHG is defined as a single pollutant quantified by summing six (6) specific gases evaluated using a common metric of carbon dioxide equivalent (CO2e). This is referred to as the “Sum-of-Six Well-Mixed GHG”.  Carbon dioxide (CO2)  Methane (CH4)  Nitrous Oxide (N2O)  Hydrofluorocarbons (HFC)  Perfluorocarbons (PFC)  Sulfur hexafluoride (SF6)
  • 10. GHG Tailoring Rule PSD Applicability for GHG emission sources • Projects adding new or modifying emission units Step 1 – January 2, 2011 to June 30, 2011 • No sources become major for PSD based solely on GHG emissions • Sources major for any PSD pollutant other than GHG will also be major for GHG if the project increases GHG emissions by 75,000 tpy CO2e or more Step 2 – July 1, 2011 to June 30, 2016 • Regardless of other PSD pollutants, the following must meet PSD permitting requirements:  New sources that emit GHGs at or above 100,000 tpy CO2e  Modifications that increase GHG emissions by at least 75,000 tpy CO2e
  • 11. GHG Tailoring Rule What are PSD requirements for GHG emissions? • Must demonstrate Best Available Control Technology (BACT) What is BACT for GHG Emissions? • Guidance for state and local permitting authorities included in PSD and Title V Permitting Guidance For Greenhouse Gases issued by U.S. EPA on November 10, 2010
  • 12. GHG Tailoring Rule PSD Permitting Guidance for GHGs • Does not prescribe GHG BACT for sources. • Reiterates that BACT will continue to be a state and project specific decision. • Emphasizes importance of BACT options that improve energy efficiency. • Confirms use of the traditional five-step process for determining BACT for GHGs. • Identifies technical resources related to GHG emissions and controls. • Illustrates methods for calculating GHG emissions for PSD evaluations.
  • 13. GHG Tailoring Rule Title V Applicability for GHG emission sources • Applications for new permits, renewals or revisions. Step 1 – January 2, 2011 to June 30, 2011 • No sources become major requiring a Title V permit based solely on GHG emissions. • Sources currently subject to Title V program for pollutants other than GHG must apply all Title V requirements to their GHG emissions. Step 2 – July 1, 2011 to June 30, 2016 • Facilities with GHG emissions of 100,000 tpy CO2e or more must obtain a Title V Operating Permit if they do not already have one.
  • 14. GHG Tailoring Rule What are Title V requirements for GHG emissions? • No current Title V requirements to control GHG. • No other current CAA requirements (e.g., NESHAP) applicable to GHG. • State rules may have requirements (e.g., monitoring, recordkeeping and reporting). • Federal GHG Reporting Rule is not a Title V requirement.
  • 15. GHG Tailoring Rule Title V Permitting Guidance for GHGs • Applies long-standing permitting requirements and processes to GHGs. • Confirms that initially the only Federal Title V requirements applicable to GHGs will be those associated with any PSD-related controls. • Acknowledges that permitting authorities may need to raise Title V emissions fees and offers assistance in establishing Title V fees related to GHG emissions.
  • 16. GHG Tailoring Rule Impact on permit application process: • Emission inventories for PSD applicability must include GHG pollutants for comparison to thresholds. • Permit applications pending may have to be reopened or amended to address GHG pollutants. • Even minor applications will need to demonstrate that thresholds are not exceeded. • Title V renewal or modification applications should explain GHG applicable requirements.
  • 17. GHG Tailoring Rule Related Rules Finding of Substantial Inadequacy and SIP Call • Signed as a final rule by U.S. EPA Administrator December 1, 2010 but not yet published in the Federal Register • Requires permitting programs in 13 states to make changes to their state implementation plans (SIP) to ensure GHG emissions are covered. Federal Implementation Plan • Still a proposed rule but finalization is imminent. • Allow U.S. EPA to issue permits for large GHG emitters located in states not able to develop and submit revisions to their plans before January 1, 2011.
  • 18. GHG Tailoring Rule The Future ? Numerous legal challenges • Courts have committed to rule on a stay of GHG rules by the end of 2010. Possible Congressional Action • Lots of noise from GOP leaders that action will be taken in early 2011 to block implementation of GHG rules by U.S. EPA.
  • 19. GHG Reporting Rule 40 CFR Part 98 – Mandatory Greenhouse Gas Reporting. Effective Date – December 29, 2009. Data monitoring and recordkeeping requirements began January 1, 2010. Annual 2010 GHG emissions must be reported by March 31, 2011, and then annually thereafter. Numerous amendments during 2010. • Changes to existing requirements that impact the current year reporting. • Adding new source categories which will have to report starting next year.
  • 20. GHG Reporting Rule Getting Ready To Report Upcoming Deadlines • January 30, 2011: Certificate of Representation due. • March 31, 2011: 2010 Annual Greenhouse Gas Report due.
  • 21. GHG Reporting Rule Getting Ready To Report Data Checkup • Fuel usage and characteristics. • Process material quantities. • Process carbon chemistry. • Heat input capacity of aggregated units. • Missing data. • Calculation tool. • “Dry run” calculations.
  • 22. GHG Reporting Rule Getting Ready To Report U.S. EPA’s Electronic Greenhouse Gas Reporting Tool (e-GGRT) • User registration portion expected to be online this fall. • Must use this system to submit Certificate of Representation (due January 30, 2011) and annual reports. • No information available yet on what the reporting portion will look like.

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