PROPOSED AMENDMENT OF

RULE 213

, GASOLINE TRANSFER INTO STATIONARY STORAGE CONTAINERS

STAFF REPORT

Executive Summary

Control of gasoline emissions from the fueling infrastructure in California is a major program area of the

Califor nia Air Resources Board (ARB). State concerns with gasoline vapor emissions are twofold; health risk from breathing benzene which is a component of gasoline, and the release of Reactive Organic Compounds which contribute to ozon e formation in the atmosphere. ARB is continually promulgating new and revised regulations which set the design and operating specifications for equipment used in the gasoline fueli ng infrastructure in the state. This equipment is t hen rigorously

tested by ARB to confirm compl iance with the specifications. Once equipment passes the testing, ARB issues what are called Executive Orders which certifies the equipment for use in California. ARB also promulgates timelines regulating when t he new equipment must be added to, or replace older equipment.

Rule 213, Gasoline Transfer into Stationary Storage Containers , is the District rule that applies to the transfer of gasoline into stationary storage containers (the gasoli ne tanks at service stations). This rule is in need of amendment to comply with a recent new regulation from ARB. Specifically, the new controls on aboveground tanks called Standing Loss Vapor Recovery Contr ol.

Background

There are two District rules which deal with gasoline dispensing facilities (GDF); Rule 213 which deals with the storage tank part of the GDF and Rule 214, Transfer of Gasoline into Vehicle Fuel Tanks

, which deals with the d ispensing part of the facility. ARB regulations have historically been divid ed into Phase I which deals with the storage tank, and Phase II which deals w ith the dispensing of gasoline. District Rule 213 requires that equipment be ARB certified as Phase I equipment, and District Rule 214 requires this equipment be Phase II certifie d.

The Standing Loss regulation is neither Phase I nor Phase II, bu t a third class of regulation. Current

District rules do not mention this Stan ding Loss class of regulation. This amendment of Rule 213 will add the Standing Loss requirements.

Discussion of Proposed Rule 213 Significant Changes

Discussed below are descriptions of the significant changes in Rule 213

. In addition to these significant changes, the format of the rule is modified to be consistent with the current District format for rules. Some definitions, references, and wording are updated without altering the original meaning. Added a definition

for CARB CERTIFIED.

A strikeout version of the amended rule is included as Attachment A to this staff report.

Requirement for Standing Loss Certified Equipment

The Standing Loss regulation requires the use of specific white, sun reflective paint on the external surface of aboveground tanks; and the use of new pressure and vacuum relief valves. The purpose of this regulation is to reduce the v enting of gasoline vapors from tanks due to heating by the sun which evaporates gasoline inside the tanks and is then released to the atmosphere through the pressure relief

valve.

Section 3 01.8 is added to the Standards section of the rule which requires:Rule 213, GASOLINE TRANSFER INTO STATIONARY STORAGE CONTAINERS

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Transfer is made to an aboveground storage container equipped for Standing Loss Vapor Recovery Control as certified by the California Air Resources Board after April 1, 2013.

ARB certifies equipment for installation of new aboveground storage tanks in Executive Order (EO) VR

- 302 and for upgrading existi ng aboveground tanks in VR

- 301. The timeline for Standing Loss compliant new

tank i nstallations was April 1, 2009. This means that new tanks installed after this date need ed to comply with the regu lation.

The bigger issue is that existing aboveground tanks will need to be upgraded to be Standing L oss compliant by April 1, 2013. The EO for upgrading existing tanks is VR

- 301.

Most of the popul ar manufacturers of protected aboveground tanks ( SuperVault, Fireguard, ConVault, Hoover Vault, and Jensen Armor Cast) have been supplying white painted tanks for years that are no w certified for Standing Loss. Thus, many existing tanks already comply wit h the paint requirement.

The other requirement of Standing Loss is using the Husky Model 5885 Pressure Vacuum Vent Valve (PV Valve). Many existing tanks already utilize this valve due to the fact that PV valves often fail and are replaced with the Husky valve. The cost of a new Husky valve is about $500.

Tanks that are not certified due to not being manufactured by one of the listed manufacturers, or are painted some other color than white, will need to be repainted with one of th e four certified white paints.

There are currently approximately 85 aboveground tanks permitted in the District that will be subject to the Standing Loss regulation.

Exemption

Most of the aboveground tanks permitted in the District are small; 1 ,000 gallons capacity or less. Most of these tanks as manufactured are already certified for the pain t. There are a few facilities that employ multiple large vertical tanks that are not certified and would need to be painted. Three existing facilities in Placer County utilize multiple tanks of approximately 20,000 gallons capacity each. Two of these facilities have two gasoline tanks each, while the third facility employs three of these tanks. Two facilities have the tanks painted white, but not with the c ertified paint type. The third facility has the three tanks painted white, but has a mural painted on the sides, so the tanks are not entirely white.

Certif ied paint is rather expensive. The District has reports that painting a 1,000 gallon tank costs abo ut $1,000, consisting of $500 for the paint and $500 for application of the paint. Painting of multiple 20,000 gallon tanks will likely cost tens of thousands of dollars.

The three facilities with the large tanks mentioned above all employ combustion type vapor processors for pressure management in the tanks. This type of vapor processor functions by burning off gasoline vapors to keep the internal tank pressure from risin g above atmospheric pressure. This type of control is more effective in reducing gasoline vapor emissions than relying on white paint to reduce gasoline emissions from solar heating of the tank. This is because the vapor processors burn the gasoline vapo rs with approximately 99% efficiency, while the Standing Loss approach still releases some raw vapors to the atmosphere through the PV valve.

For this reason, t he District desires to exempt these large tanks from the paint ing provision of Standing

Loss. T he exemption reads:

102.2 The white paint provision of Standing Loss Vapor Recovery Control shall not apply to vertical, cylindrical, aboveground storage tanks over 15,000 gallons in capacity that use a combustion type

vapor processor that are existing on February 21, 2013Rule 213, GASOLINE TRANSFER INTO STATIONARY STORAGE CONTAINERS

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Prohibition of Sale

A provision is added to the rule that makes equipment manufacturers responsible for supplying only CARB certified equipment. Without this new provision, the District would have no enforcement a uthority over the

manufacturers of the equipment. New section 302 reads:

302 A person shall not supply, offer for sale, sell, install or allow the installation of any new or rebuilt vapor recovery system or any of its components, unless the system an d component are CARB

certified. Each vapor recovery system and its components shall be clearly and permanently marked with the qualified manufacturer’s name and mod el number as certified by CARB. In addition, any qualified manufacturer who rebuilds a compone nt shall also clearly and permanently mark the corresponding information on the component.

Test Methods

The test methods section of the rule is amended to change from EPA general test methods to CARB test methods which are specific to the certified enhanced vapor recovery equipment. The new wording of the

section is:

402 TEST METHODS : Test methods for compliance testing for this rule shall be in accordance with CARB vapor recovery test procedures.

EPA commented that the rule section on test procedures should list the applicable test procedures instead of only saying that test methods for compliance testing shall be in accordance with CARB vapor recovery test procedures. Staff responded by explaining that CARB is currently reviewing the compliance test procedures and is attempting to eliminate some procedures and combine others in a single pr ocedure. This effort will likely make a current listing of procedures inaccurate and require a

su bsequent amend ment of Rule 213. The wording of the section was modified to add the CARB test methods. A section was added to allow other test methods that may be specified at a later time by the

Executive Orders:

402 TEST METHODS: Test methods for compliance testing for this rule shall be conducted in accordance with the following test methods.

402.1 Static Torque of Rotatable Phase I Adaptors: CARB Test Procedure TP

201.1B.

402.2 Leak Rate of Drop Tube/Drain Valve Assembly Test: CARB Test

ProcedureTP

- 201.1C.

402 .3 Leak Rate of Drop Overfill Protection Devices and Spill Container Drain Valves:

CARB Test Procedure TP

- 201.1D

402.3 Leak Rate and Cracking Pressure of P/V Valves Test: CARB Test Procedure

TP

- 201.1E.

402.4 Static Leak Tests: CARB Test Procedure TP

- 201.3 or TP

- 201.3B as applicable.

402.5 Those vapor recovery systems whose CARB Executive Orders specify different tests to be performed instead of, or in addition to, the referenced test methods, or which, by their design, preclude the use of the refe renced test methods,Rule 213, GASOLINE TRANSFER INTO STATIONARY STORAGE CONTAINERS

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shall be tested in accordance with the test procedures specified in the applicable CARB Executive Orders or their equivalents as approved by the

APCO and EPA.

402.6 Multiple Test Methods: When more than one test method or set of test methods is specified for any testing, a violation of any requirements of this rule established by any one of the specified test methods or set of test methods

shall constitute a violation of this rule.

Fisca l Impact

The amendment of Rule 213 will have a fiscal impact on aboveground tank GDF permit holders as compared with b usiness under the current rule. The rule amendment adds the Standing Loss requirement on aboveground tank sys tems. This modification of existing tanks is required according to

the CARB timeli ne of April 1, 2013. However, Standing Loss compatibility would eventually be required under District rules when the Phase I EVR upgrade to existing aboveground tanks is required by th e CARB timeline of July 1, 2014. The EOs for Phase I EVR equipment all require t hat Standing Loss is

installed. The addition of Standing Loss to Rule 213 accelerates the deadline by 15 months.

The cost of complying with the Standing Loss requirement is es timated at $500 if the PV valve is not already installed and $1,000 if the tank needs to be painte d with a complying white paint. This would apply to tanks up to 1,000 gallons in size.

The exemption from painting large vertical tanks would save owners/ope rators of those tanks tens of

thousands of dollars.

Outreach

The public was notified of the proposed amendment of Rule 213 through a newspaper notice and direct mailer of a notice to each permitted gasoline dispen sing facility in the District. The notic e specified the time and place of the public hearing to adopt the amended rule, and referenced the District website where the rule and staff report could be reviewed.

The draft rule amendments and staff report were se nt to EPA and ARB for comment. ARB responded

with no comment. EPA responded with one comment. The EPA comment is addressed above in the

test methods section.

Analysis and Findings

The following Analysis and the subsequent Findings are intended to address the requirements set forth in

the Health and Safety Code relating to adoption of a new or amended District Rule, as well as other State

statutes referenced herein.

Cost

- Effectiveness of a Control Measure

California Health & Safety Code (H&S) Section 40703 requires a District to consider and make public “the

cost

- effectiveness of a control measure”. The cost

- effectiveness of the Standing Loss requirement has been addressed by CARB when the Standing Loss regulation was originally promulgated.

Socioeconomic ImpactRule 213, GASOLINE TRANSFER INTO STATIONARY STORAGE CONTAINERS

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H&S Section 40728, in relevant part, requires the Board to consider the socioeconomic impact of any new rule if air quality or emission limits are significantly affected. However, Districts with a population of less than 500,000 persons are exempted from the socioeconomic analy si s. In 2011, the population of Placer County was approximately 352,000 persons. Therefore, the District is not required to consider the socioeconomic impacts of the proposed rule amendment.

California Environmental Quality Act (CEQA)

Proposed amended Ru le 213 is not an activity that may cause a direct or reasonably foreseeable indirect physical effect in the environment therefore not considered a “project”, as defined by Section 21065 of the California Public Resource Code and Section 15378(b)(4)&(5) of the CEQA guidelines.

According to the above conclusion, Staff finds that the proposed rule is exempt from the California Environmental Quality Act (CEQA) because 1) it can be seen with certainty that there is no possibility that the activity in question m ay have a significant adverse effect on the environment (CEQA Guidelines §15061(b ) ( 3)) and 2) it is an action by a regulatory agency for protection of the environment (Class 8 Categorical Exemption, CEQA Guidelines §15308). A CEQA analysis is therefore not necessary.

Findings

A. Necessity

– The amendment of Rule 213 is necessary in order to incorporate updated

California Air Resources Board (CARB) requirements for gasoline dispensing facilities

. This rule amendment will provide the District with enforcement authority for CARB Standing Loss regulations.

B. Authority

– California Health and Safety Code, Sections 40702, 41511, and 42303 are provisions of law that provide the District with the authority to adopt this amended Rule.

C. Clarity

– There is no indication, at this time, that the proposed Rule is written in such a manner that persons affected by the Rule cannot easily understand t hem.

D. Consistency

– The regulation is in harmony with, and not in conflict with or contradictory to, existing statutes, court decisions, or state or federal regulations.

E. Non

- duplication

– The regulation does not impose the same requirements as an existing state or federal regulation.

F. Reference

– All statutes, court decisions, and other provisions of law used by PCAPCD in interpreting this regulation is incorporated into this analysis and this finding by reference.