# Air Pollution Control District San Luis Obispo County

December 16, 2014 Gerardo Rios Chief, Air Permits Office (Air-3) EPA Region 9 75 Hawthorne Street San Francisco, CA 94105 RE: Clarifications for Rule 220 - Federal Prevention ofSignificant Deterioration Dear Mr
. Rios: On May 13, 2014, the California Air Resources Board (CARB) submitted for the Environmental Protection Agency's (EPA) approval San Luis Obispo Air Pollution Control District (District) Rule 220 - Federal Prevention ofSignificant Deterioration. This letter provides additional information and clarifications related to greenhouse gas permitting requirements and transferringthe PSD program from EPA to the District. Clarification Regarding Greenhouse Gas Requirements: On June 23, 2014, the Supreme Court issued its opinion in UtilityAirRegulatory Group v. Environmental Protection Agency(No. 12-1146) ("UARG'1that EPA may nottreat greenhouse gases (GHGs) as an air pollutantfor purposes ofdeterminingwhether a source is a major source (or modification thereof) required to obtain a PSD permit (referred to as "Step 2 of

·the GHG Tailoring Rule"). The Supreme Court also said that EPA could continue to require that PSD permits, otherwise required based on emissions ofconventional pollutants, contain limitations on GHG emissions based on the application of BACT. District Rule 10.10, Section C incorporates by reference EPA's PSD regulations at 40 CFR 52.21 as ofAugust 1, 2011. In light ofthe Supreme Court's UARG decision, onJune 23, 2014, I requested thatARB notify EPA thatARB and the Districtwould like to withdrawfrom ARB's April 22, 2013 SIP submittal the portion of District Rule 10.10 that incorporates by reference 40 CFR 52.21(b)(49)(v). This withdrawal is designed to ensure that EPA can act on the District's SIP submittal consistent with the Supreme Court's UARG decision concerning Step 2 ofthe GHG Tailoring Rule. The District understands that EPA will need to make revisions to 40 CFR 52
.21 as a result ofthe UARG decision and the associated remand process that is still ongoing. In the interim, the District intends to apply40 CFR 52
.21 as incorporated by reference into District Rule 10.10, Section C in mannerthat is consistent with EPA's interpretation ofthe Supreme Court's decision and EPA guidance and policywith respect to application ofsection 52
.21 while revisions to the regulations are pending.

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### Clarificationsfor Rule 220 December 16, 2014 Page 2of2
Discussion ofSection 11O(a)(2)(E)(i): 

### Pursuant to Section 11 O(a)(2)(E)(i) of the Clean Air Act, we discuss how the information provided previously and State and District statutory and regulatory requirements demonstrate that the District has adequate personnel, funding, and authority under State and/or local law to implement the PSD program within the District. The District has the primary responsibility for regulating air pollution from all stationary sources within the District (see California Health & Safety Code (H&SC) sections 39002 and 40000). The California Air Resources Board oversees the District's activities and regulates mobile sources of air pollution. Under State law, the District is required to adopt rules to achieve ambient air quality standards and to enforce the provisions of local, State and federal air quality laws (see H&SC section 40001 (a)). The District's permitting program (which is authorized by H&SC section 42300 and must meetthe requirements ofsection 42301 ), as approved by EPA, currently implements requirements from
.both the California and Federal Clean AirActs
.The District is authorized by state law to enforce its rules, regulations and orders, including conditions contained in District-issued Title Vand PSD permits (see H&SC §§ 

### 40752(b); 41513; 42402-42403). Rule 220 provides the District with specific authorityto issue PSD permits and otherwise implement and enforce the PSD program . As discussed in our May 13, 2014 submittal, the District does not expect Rule 220 to have any significantfinancial impacts, as funding and · staffing for PSD permits will be provided through existing fee requirements in District Rules 301 and 302; we currently have no existing PSD permits. Rule 220 is expected to streamline the permitting requirements and allow the Districtto use local timelines and appeal processes for projects that are subject to federal PSD. The above information shows thatthe District has adequate legal authority, personnel and funding to implement and enforce the PSD program Ifyou oryour staff have any questions, please do not hesitate to contact me. Very trulyyours,

LARRY 

### R. ALLEN Air Pollution Control Officer
H:\RULES\SIP\Rule 220 SIP Clarification Lener to EPA.docx