P.1 

OAR Box 1875 

Prepped by Ollie Stewart 

Document Number: 

58) ll-F-5 

Docket Number: 

A-90-19 

Printed 12/1/200811:12:47AM Sheet 58 of 86 
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A-90-19 

ll-F-5 

July 28, 1992 

NOTE TO: Troy Hillier 

Bruce asked me to send you these two memos from the members 

of the National Governors Association's (NGA's) Air 

Implementation Task Force HON Work Group. Both memos discuss the 

use of a discount factor in HON emissions averaging. We will 

have a chance to discuss these ideas, and other ideas that the . 

states have about emissions averaging, in our meeting next week. 

Daphne McMurrer 

2 Attachments 

cc: (w/o attachments) 

Doug Bell 

Linda Herring 

Bruce Jordan 

Jan Meyer 

Lydia Wegman 

jj) B 6 E 0 w 

DEC 

EPA AIR DOCKET 

1992 Hw 
P.3 

/NATIONAL 

GOVERNORS 

ASSOCIATION 

John Ashcroft 

Governor of Missouri 

Chairman 

Roy Romer 

Governor of Colorado 

Vice Chairman 

TU&$ 

./«iz *&***+ 

V Raymond C.^Seheppach 

Executive Director 

Hall ofthe States 

•*•»•* North Capitol Street 

Washington. DC. :000I-I5": 

Telephone CO^I &:•»•< JO) 

* + * + 

**** * 

June 1, 1992 

MEMORANDU M 

TO: William G. Rosenberg 

FROM: John Thomasiari^. »*Vr' '**>*+, 

Heidi Snc)^^^ ^ 

RE: State Consensus on the HON 

Attached is a brief summary of the state environmental commissioners' consensus on 

HON emissions averaging. As you recall, during our May conference call the 

commissioners agreed to participate in a separate conference call and meeting with Bruce 

Jordan and his staff during the month to discuss the HON Rule. The attached consensus 

was reached after further discussion of these issues among the commissioners prior to the 

State/EPA Operations Committee Meeting on May 28. 

In general, the commissioners support the concept of averaging and believe it should be 

pursued if certain problems can be overcome. With regard to two of these issues --

interpollutant averaging and the discount factor — the commissioners wish to work with 

EPA to develop acceptable solutions. The State/EPA Operations Committee agreed on 

May 28 that NGA would organize a HON workgroup consisting of a few Air 

Implementation Task Force members, their air directors, and STAPPA representatives to 

address these issues. The group will work with EPA over me next month to develop a 

system for interpollutant trading and a justifiable discount factor that states and EPA can 

support. 

Please let us know if you have any questions about the commissioners' position or the 

HON workgroup. 

cc: Tom Kieman 

Jeff Clark 

,/Bruce Jordan 

Bill Becker 
SUMMARY OF STATE CONSENSUS 

ON HON EMISSIONS AVERAGING* 

• Averaging Period 

The state environmental commissioners endorse the current proposal's averaging 

period (three-month rolling average measured on a monthly basis). They believe it 

represents a reasonable compromise of industry and environmental concerns. 

• Averaging Among Existing Sources 

The state environmental commissioners endorse averaging among existing sources of 

toxics, as long as other enforceable requirements (e.g. performance standards) remain 

in place as well. They believe this type of averaging will benefit the environment 

and provide industry with the flexibility needed to meet environmental objectives. 

• Averaging Among New Sources 

The state environmental commissioners do not endorse a system of emission 

averaging among new sources. It is most cost-effective to put state-of-the-art 

controls on a unit is when it is new. Moreover, me commissioners believe MACT 

allows no room for "under control" on new units. In sum, die commissioners believe 

toxic emissions averaging for new sources is inconsistent with me Clean Air Act's 

intent. 

• Interpollutant Averaging 

The state environmental commissioners cannot endorse the current proposal allowing 

interpollutant averaging, even though the proposal recognizes that there are potential 

health and environmental problems associated with this averaging. They believe that 

until a credible system that assures "risk equivalency" is developed, interpollutant 

averaging should not be an option. 

The commissioners propose establishing a workgroup to work with EPA to attempt to 

develop a mutually acceptable system for assuring "risk equivalent" interpollutant 

averaging. "* 

• Discount Factor 

The commissioners support the concept of a discount factor to account for the 

uncertainty associated with averaging and to ensure that the marginal costs of 

reducing pollutants are shared among industry and the environment. However, they 

are uncertain whether a single percentage or a system mat accounts for the variation 

of uncertainty with each average should be utilized. 

The commissioners propose using the above-mentioned workgroup to attempt to 

develop (with EPA) an acceptable discount factor. 

• The consensus was reached among state environmental commissioners 

participating in the State/EPA Operations Committee Meeting, May 28,1992. 

National Governors' Association 

June 1.1992 
P.5 

NATIONAL 

; OOVIRNORS 

t ASSOCIATION 

John Ashcrnft 

Governor of Missouri 

Chairman 

Roy Romer 

Governor of Colorado 

Vice Chairman 

Ravmond C Scheppach 

Executive Director 

Hall ofthe States 

•»•»•» North Capitol Street 

.Washington. DC. .'0O0I-I5" 

Telephone i JO-• ISJ4.5JUO 

+ + * + Jul y 21 , 1992 

MEMORANDUM 

TO: Air Implementation Task Force 

FROM: Heidi Snov 

RE: HON Workgroup Activities 

On July 20 Tad Aburn, Karen Olson, Bill 0'Sullivan and I had a 

conference call to discuss the discount factor for emissions 

averaging under the HON. The four of us agreed to put forth the 

attached discount factor proposal for your review. 

As indicated, the system applies a discount factor based upon 

whether use of the HAP is eliminated and how emission reduction 

credits are quantified. In addition, given state experience with 

emission modelling, the group felt that averaging should be used to 

overcontrol emissions from units with shorter effective stack 

heights. The group also agreed that wastewater emissions were very 

similar to fugitive emissions, and since fugitive emissions are 

excluded from the averaging system, wastewater should be treated 

likewise. Relative impacts for emission averages were calculated by 

Karen Olson to address concerns about dispersion rates and ability 

to predict emissions from various source types. Results of these 

calculations are attached. 

Please review the ..attached proposal and let me know if you have any 

objections to presenting it to EPA tomorrow during the meeting with 

Bill Rosenberg. I can be contacted at 202/624-5384. 
P.6 

' SE.M BY VJDE-E 21-3 2 ll'4'A M AIR 'JUL I TV REG - '-'.,

2':-24Tor.o..: 2' 4 

Scott A. Weiner 

Commissioner 

TO: 

FROM: 

SUBJECT: 

SUtm of New Jersey 

Department of Environmental Protection and Energy 

Air Quality Regulation Program 

CN027 

Trenton. NJ 0862S-OO27 

July 21, 1992 

MEMORANDU M 

Air Implementation Task Force HON Workgroup 

Scott Weiner, Commissioner, NJDEPE 

Ken Alkema, Executive Director, Utah Division of 

Environmental Health 

Tad Aburn, Maryland Air Management Division 

Karen Olsen, Texas Air Control Board 

Don Theiler Wisconsin Air Management Bureau 

(STAPPA representative) 

Barbara Kwetz, Mass. DEP 

Bill Becker/Mary Sullivan Douglas, STAPPA/ALAPCO 

Heidi Snow, NGA 

William O'Sullivan, NJDEP4 

Strategy to Discount Air Toxics Emission Credits 

tor Emission Averaging 

William OSullivan. PE 

Administrator 

Attached is a revised strategy as result of the 7/20 conference call between Karen 

Olsen, Tad Aburn, Bill O'Sullivan and Heidi Snow. 

I recommend that this strategy be shared with Bruce Jordan ot* EPA at the 7/22 NGA 

meeting and discussed with Bill Rosenberg of EPA at the 7/27 NGA meeting. 

This can be characterized as a common sense strategy, based on technical 

considerations, but simple enough to be workable and predictable. The most controversial 

aspects of the recommendation are the "incentive to overcontrol short stacks" and the 

disallowance of credits for wastewater treatment over control. 

WOS/df 

Attachment 

c: Assistant Commissioner Weingart 

Director Wittenberg 

Assistant Director Elston 

Joann Held 

N<wj*n*y K tn LfJtl Opportunity UrfiU^m 

fecydetf Pipe/ 
P.7 

NGA CAAA Implementation Task Force 

HON Workgroup Recommended Discounting Strategy far A,ir Toxics 

Emission Reduction Credits idr? 

A. Discounting Emission Reduction Credits 

Discounting Factor 

0% 

10% 

20% 

Applicability 

Eliminate use of HAP 

(Pollution Prevention)0' 

Reduction credits 

quantified by 

emission testing*21 

Reduction credits 

quantified by other means'3' 

Rationale 

Multimedia benefits 

Certain reduction 

in HAP 

Test results generally 

accurate within 10% 

Same discount factor as 

in EPA emissions 

trading policy. 

Greater uncertainty in 

actual reduction, i.e. 

calculation of storage 

tank control emission 

reductions. 

(1) Not including source shutdowns (production reductions). 

(2) Stack tests or continuous emission monitoring. 

(3) Wastewater treatment emissions reductions may not be used for credit because 

ofthe very high uncertainty (well over 20%) in determining such emissions. 
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* . 

Industry's Issue 

Baseline for Determining Credits 

Draft does not allow credit for controls installed after 

promulgation, except: 

1) Controls in Early Reductions commitments; and 

2) Pollution Prevention measures taken after 1987. 

Reasons for this general credit policy: 

1) Emissions averaging should achieve the same or 

greater emissions reductions as point by point 

compliance; 

Crediting controls in place before 

promulgation would increase emissions under 

averaging relative to point by point 

compliance; and 

2) Credits should only be generated when a source has 

chosen to go above and beyond the requirements in 

the HON; 

Emission reductions from controls in place 

before promulgation would be achieved and 

continued with or without the HON. 

Reasons for the exceptions to this credit policy: 

1) Incentive for Early Reduction; and 

2) Reward for innovation. 

Industry concerns: 

1) Precedent setting disincentive for voluntary 

controls; and 

2) Inequitable — "dirty" plants have more opportunity 

for credits. 

Industry idea: 

1) List some specific inclusions by kind of point and 

control device 

2) List some specific inclusions by program (Early 

Reductions, 33/50) 
P.9 

J C M Ii i 

.•j i'0CO' - 4 4 

B. [nativ e to Qverrnntrol Short Starke 

Inamiiye. 

The effective stack height of air 

toxics sources generating emission 

reduction credits must be less than 

the effective stack height of the 

sources with less than maximum 

achievable control technology 

(MACT) within the MACT 

average. 

Rationale. 

-Overcontroll ing lower stacks can cause 

greater air quality benefits than 

overcontrol of higher stacks. 

-Avoiding die control of lower stacks would 

result in net adverse air quality effects. 

-Because of orders of magnitude differences in 

air quality effects, discounting emission 

credits to account for stack height differences 

is not useful. 

-Effective stack height is easily calculated. 

Therefore, this provision is easily applied. 

-Stack height considerations can appropriately 

be addressed in a control technology rule 

(analogous to EPA's Good Engineering 

Practice stack height policy). 

J 
P.10 

RELATIVE IMPACTS FOR EMISSION AVERAGE* 

Emissions = 1 Ton/Quarter. 

STACK: Height = 50' 

Diameter = 2' 

Temperature = 140°F 

Velocity = 25 feet/second 

Emissions = 20001b/month / day 

3 mo. /31 days/ 24hr. = °'9 lb/hour. 

55.6 micrograms per cubic meter. 

TANK: Height =18' 

Diameter = 3' 

Temperature = 90°F 

Velocity = 0.001 feet/second 

Emissions = 20001b 

23.3 mo. =

 85'8 lb/hour. 

Assume: 2 turnovers per quarter. 

10,000 BB1 tank 600 gpm 

2 /lO.OOO/ 42 / 

I /600/60

 = 23.3 hours per quarter, 

78,880 micrograms per cubic meter. 

LOADING: Height =10' 

Diameter = 3' 

Temperature = 90°F 

Velocity = 0.001 feet/second 

Emissions = 62.81b /8000gal 

1000gal| hour =

 502 '4 lb/hour. 

Assume: •» LL = 12.46 spm/T 

J 

550

 = 62.8 hours per 1000 gal. loading. 

12.46 Ae A.o/ee 

500 gal/minute divided by 15 minutes per hour is about 

8000 gallongs loading per hour. 

535,200 micrograms per cubic meter. 

KASTBWATB: Height = 1' 

Diameter = 3' 

Temperature = 90°F 

Velocity = 0.001 feet/second 

Emissions =0.9 pounds per hour 

1017 micrograms per cubic meter with dounwash. 

1.22x10 micrograms per cubic meter without downwash. 

* Estimates generated by Karen Olson, Texas Air Control Board.