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OAR Box 1787 

Prepped by Ollie Stewart 

Document Number: 

45) ll-C-3 

Docket Number: 

A-90-37 

Printed 11/4/2008 10:22:19 AM Sheet 45 of 147 
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UNITED STATES ENVIRONMENTAL PROTECTION AGENCY 

Office of Air Quality Planning and Standards 

Research Triangle Park, North Carolina 27711 

IE-C-3 

Ms. Christine Shaver 

Environmental Defense Fund 

1405 Arapahoe Avenue 

Boulder, CO 80302 

Dear Ms. Shaver: 

jj) BB E m I? 

OCT I 31993 H) 

EPA AIR DOCKET 

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I want to thank you for your participation in the first 

meeting of the New Source Review (NSR) Subcommittee on

 , 

July 21-22, 1993. As you recall, we agreed at the meeting to 

form six subgroups to focus dialogue on specific areas regarding 

Class I area impacts and the best available control technology 

analysis. As was discussed at the NSR Reform meeting, the charge 

of each subgroup is to formulate draft recommendations on their 

respective topics for the full subcommittee to review at the next 

NSR Reform meeting, currently scheduled for September 27 and 28. 

Enclosed is a list of the subgroup members and the charge to each 

of the subgroups, setting forth the goals of each subgroup and 

the questions we would like them to consider. The charges as 

outlined are derived from the discussions at the July meeting and 

are not intended to represent an Environmental Protection Agency 

(EPA) position on the issues presented. The subgroups are, of 

course, free to address and offer draft recommendations on any 

additional issues that arise during their discussions. 

As discussed at the July meeting, we would like each 

subgroup to submit a brief interim report to EPA by August 30. 

We would like the subgroups' draft recommendations, any summary 

of the groups7 discussions, and any dissenting views to be 

submitted by September 17. This will allow EPA to distribute the 

reports to all subcommittee members about a week before the full 

subcommittee meeting. The subgroups' interim and final reports 

should be sent to David Solomon, Chief, New Source Review 

Section. David's staff will handle the coordination and 

distribution of all subgroup materials to the full subcommittee 

prior to the next meeting. If you have any questions concerning 

the enclosed materials, please contact him at (919) 541-5375. 
P.3 

I appreciate your willingness to devote time to this 

subgroup effort. Please feel free to call me if you have any 

questions concerning the subcommittee activities. 

Sincerely, 

Lydia N. Wegman 

Deputy Director 

Office of Air Quality Planning 

and Standards 

Enclosures 
P.4 

SUBCOMMITTEE MEMBERS 

Name Affiliation 

David Aldorfer 

Praveen Amar 

Barbara Bankoff 

Michael Barr 

Andrea Bear Field 

William Becker 

William Bumpers 

Mark Carney 

David Carr 

Pamela Faggert 

David Hawkins 

James Jewett 

Chuck Knauss 

William Lewis 

David McAvoy 

Vivian Mclntire 

Ray Menebroker 

John Paul 

William Pedersen 

Patrick Raher 

Leslie Ritts 

Ernest Rosenberg 

Christine Shaver 

Wendy Sims 

Donald Thieler 

Joseph Williams 

Richard Zbur 

General Motors 

NESCAUM 

Siemens Corporation 

Pillsbury, Madison & Sutro/National 

Association of Manufacturers 

Hunton & Williams/Util. Air Reg. Grp. 

STAPPA/ALAPCO 

Howery & Simon/Class of '85 Utilities 

Electric Generation Assoc. 

Southern Environmental Law Center 

VA Department of Air Pollution Control * 

Natural Resources Defense Council 

Intel Corporation 

Swindler & Berlin 

Morgan, Lewis & Bockius 

Eli Lilly 

Eastman Chemical Company 

CA Air Resources Board 

Regional Air Pollution Control Agency 

Perkins Coie/Council for Clean Air Implement. 

Hogan & Hartson 

Chadbourne & Parke/NEDA-CARP 

Occidental Petroleum/Chemical Manuf. Assoc. 

Environmental Defense Fund 

OR Department of Environmental Quality 

WI Department of Natural Resources 

WA Department of Ecology 

Latham & Watkins 

Invited Federal Participants 

Name Affiliation 

John Bunyak 

Richard Fisher 

Lynne Hamjian 

Marcia Spink 

Bruce Miller 

David Kee 

David Bray 

Bill Tyndall 

Greg Foote 

Chris Knopes 

National Park Service 

USDA Forest Service 

EPA Region I 

EPA Region III 

EPA Region IV 

EPA Region V 

EPA Region X 

EPA OPAR 

EPA OGC 

EPA OPPE 
Clean Air Act Advisory Committee 

NSR PERMITTING NEAR CLASS I AREAS 

PROCEDURES AND COORDINATION: 

Leslie Ritts, Chadborne and Park (Leader) 

David Hawkins, NRDC 

Debbie Potter, USDA Forest Service 

Dee Morse, NPS 

State/local representative to be named 

Dan deRoeck, EPA, NSRS 

Vickie Patton, EPA, OGC 

DETERMINATION OF ADVERSE IMPACTS, INCLUDING 

INCREMENTS. AND AQRVs: 

Rich Fisher, USDA Forest Service (Leader) 

Andrea Bear Field, Hunton and Williams 

David Carr, Southern Environmental Law Center 

Vivian Mclntire, Eastman Chemical Company 

William Pedersen, Perkins Coie 

Tonnie Maniero, NPS 

State/local representative to be named 

Dennis Crumpler, EPA, NSRS 

Dan deRoeck, EPA, NSRS 

Vickie Patton, EPA, OGC 

Bruce Pofkowsky, EPA, ASB 

MITIGATION OF SOURCE IMPACTS: 

Mark Carney, EGA/U.S. Generating Co. (Leader) 

S. William Becker, STAPPA/ALAPCO (tenative) 

Pamela Faggert, Virginia APC 

Chris Shaver, EOF 

John Bunyak, NPS 

State/local representative to be named 

USDA Forest Service representative to be named 

Mark Kataoka, EPA, OGC 

Dan deRoeck, EPA, NSRS 

Bill Tyndall, EPA, OPAR 

New Source Review Reform Subcommittee Subgroups 

BACT/LAER DETERMINATIONS 

BACT/LAER CLEARINGHOUSE AND PRESUMPTIVE BACT: 

David McAvoy, Eli Lilly (Leader) 

Mark Carney, EGA/U.S. Generating 

David Carr (or substitute), Southern Environmental Law Center 

Vivian Mclntire, Eastman Chemical Company 

Ray Menebroker, California Air Resources Board 

John Paul, Regional Air Pollution Control Agency (ALAPCO) 

Patrick Raher, Hogan & Hartson 

Jon Notar, NPS 

Dennis Crumpler, EPA, NSRS 

Robert Blaszczak, EPA, ESD 

Mark Kataoka, EPA, OGC 

BACT/LAER CRITERIA: 

William Bumpers, Howery & Simon (Leader) 

Praveen Amar, NESCAUM 

Andrea Bear Field, Hunton and Williams 

David Hawkins, NRDC 

Chuck Knauss, Swindler & Berlin 

Leslie Ritts, Chadborne and Parke 

Donald Theiler, Wisconsin Department of Natural Resources 

John Bunyak, NPS 

Vickie Patton, EPA, OGC 

Ron Van Mersbergen, EPA, Region V 

David Solomon, EPA, NSRS 

Clara Poffenberger, EPA, SSCD 

INNOVATIVE CONTROL TECHNOLOGIES AND POLLUTION PREVENTION: 

Barbara Bankoff, Siemens (Leader) 

David Aldorfer, General Motors 

Michael Barr, Pillsbury, Madison & Sutro (NAM) 

Jim Jewett, Intel Corporation 

Tom Micai (tenative), NJDEPE 

Chris Shaver, EDF 

Richard Zbur, Latham & Watkins 

Larry Elmore, EPA, NSRS 

Mark Kataoka, EPA, OGC 

Bill Tyndall, EPA, OPAR 
P.6 

NSR Reform SubGroups 

• Permitting Sources With Class I Impacts 

- Procedures and Coordination 

- Determination of Adverse Impacts (Increments & AQRVs) 

- Mitigation of Source Impacts 

• BACT/LAER Determinations 

- BACT/LAER Clearinghouse and "Presumptive" BACT 

- BACT/LAER Criteria 

- Innovative Control Technologies and Pollution Prevention 
P.7 

Permitting Sources With Class I Impacts: Procedures and 

Coordination 

Description: Proposed sources which may, or actually do, have an 

adverse impact on Class I areas sometimes experience delays in 

receipt of a final permit determination. Identifying steps that 

can be taken to ensure early and continued involvement by the 

Federal Land Manager's (FLM's) and the public during the 

prevention of significant deterioration (PSD) permit review 

process may help avoid such delays. Also, existing PSD 

regulations may not adequately address the important 

interrelationship between the FLM and the permit-granting 

authority concerning the analysis pf possible adverse impacts on 

air quality related values and the ultimate determination afe to 

whether such impacts warrant denial of, or conditions in, a PSD 

permit. 

Goals: Provide proposed recommendations regarding changes 

(regulatory and other) that will improve the overall coordination 

between FLM's, peraitting authorities, permit applicants and the 

public to ensure Class I impact issues are raised and addressed 

in a timely and appropriate manner. 

Questions: 

1. What steps can be taken to reduce permitting delays 

resulting from separate FLM and permitting authority 

reviews? Also, how can the administrative burden for 

determining whether an adverse impact may occur in a Class I 

area be fairly distributed among the involved parties? 

2. Pre-application meetings between the applicant, permitting 

authority and FLM's as well as advanced FLM notification of 

the proposed project promote early discussion of Class I 

concerns and can reduce "late hits" on a project during the 

public comment period. How can FLM notification and input 

(in advance of the public comment period) be formalized 

within the PSD review process? In addition, how can public 

input and concerns be addressed early in the PSD review 

process for a source with potential Class J area impacts? 

3. What can be done to ensure that FLM's have adequate 

opportunity to assess impacts of proposed sources (or 

projects) and to ensure that adequate consideration is given 

to the FLM's adverse impact determinations? 

4. What alternative means are available for resolving 

disagreements between the permitting authority, the FLM, 

applicant, and public over a finding of adverse impacts 

before a final permit is issued? 
R.fi^ 

Permitting Sources with Class I Impacts: Determination of Adverse 

Impacts 

Description: Congress established the Class I increments as well 

as the concept of air quality related values (AQRVs) as the 

measures for assessing whether proposed emission increases can be 

allowed near Class I areas. If no increment violation is 

predicted, the FLM's must demonstrate to the satisfaction of the 

State that an adverse AQRV impact will occur. If, however, an 

increment violation is predicted, then the source must 

demonstrate to the satisfaction of the FLM that no adverse AQRV 

impact will result from the source's emissions. The 

identification of specific AQRVs for each Class I area, and the 

definition of data and criteria needed to analyze adequately the 

potential impacts of the proposed source would both be useful in 

accelerating the review process. 

Several subcommittee members suggested that de minimis thresholds 

would be appropriate for determining impacts on both the 

increments and AQRVs; however, EPA has not issued nationally 

applicable thresholds. In addition, members suggested that some 

assessment of cumulative impacts is necessary to account for the 

net impacts on AQRVs. 

Goals: Propose recommendations for establishing the necessary 

procedures and criteria for performing and evaluating adverse 

impact determinations. 

Questions: 

1. Permit applicants and permitting authorities need more 

specific information concerning the particular AQRVs 

associated with individual Class I areas to analyze Class I 

impacts. What kinds of information and common criteria 

related to AQFV's and effects are available, or can be made 

available, to industry, the permitting authorities and the 

public to improve the AQRV analyses and evaluation of the 

analyses (e.g., FLM screening values)? 

2. What is the extent of the distance or area over which 

existing source emissions should be considered in a Class I 

analysis? What criteria should be used to determine which 

existing source emissions are included in the Class I impact 

analysis? 
P.9 

3. Class I increments do not exist for tropospheric ozone. In 

the absence of modeling techniques for predicting ambient 

ozone levels, a PSD increment would be meaningless. Yet 

high ozone levels in many Class I areas have been 

identified. What alternatives to a numerical PSD increment 

for ozone are available to protect Class I areas? Should 

EPA consider emissions density zoning or other nonincrement 

measures under the Clean Air Act § 166? 

4. There are often disagreements as to what distance from a 

Class I area a new source must locate in order to avoid a 

Class I analysis. The EPA's current policy is that sources 

within 100 km be addressed, with case-by-case consideration 

of more distant sources. What changes or clarifications to 

this existing guidance on when a Class I analysis is 

required would improve the current system? 

5. The EPA uses significance levels for determining significant 

ambient impacts on the national ambient air quality 

standards (NAAQS) and PSD increments. Are national 

significance levels for Class I increments appropriate where 

there are existing violations and how would such levels be 

set (e.g., Virginia and National Park Service significance 

levels)? Conceivably, significance levels could allow new 

sources to continue to be constructed and potentially 

exacerbate violations of the increment indefinitely (i.e., 

the overflowing cup analogy). Should the use of 

significance levels be restricted in such circumstances? 

What objective criteria, e.g., significance levels, can be 

developed for determining adverse impacts on AQRVrs? Should 

significance levels be developed specifically for each AQRV 

and how would such levels be set? Should new sources be 

banned in any area experiencing increment violations unless 

the impacts of the new source are mitigated and the existing 

increment violation cured? Should EPA issue SIP calls to 

cure increment violations? 

6. If de minimis criteria for adverse impacts are developed, 

what opportunity during the permitting process can be made 

available to rebut presumptions concerning impacts less than 

and greater than a de minimis level and what would be the 

criteria by which these presumptions could be rebutted? 

7. Should a standard analytical approach (and evaluation 

criteria) be prescribed for determining a finding of adverse 

impacts (e.g., rules of thumb, such as distance and 

pollutant relationships resulting in adverse impacts on 

Class I areas)? 
P.10 

8. An AQRV Clearinghouse is being considered as a means of 

better informing applicants and permitting authorities of 

the AQRVs of interest or concern for a particular Class I ' 

area. What type of information would be the most useful for 

such a clearinghouse to contain and what mechanisms exist to 

ensure that the information is submitted? 

9. What criteria should be met by the State/FLM in rejecting a 

finding of adverse impact/no adverse impact? Past 

permitting disputes have exposed the absence of standards 

for States to use in justifying rejection of an FLM's 

adverse impact finding. Conversely, standards may be useful 

for guiding an FLM's decision on whether to reject a finding 

of no adverse impact. 
p.11 

Permitting Sources with Class I Impacts: Mitigation of Source 

Impact 

Description: Once it has been demonstrated that a proposed 

source will adversely impact a Class I area, the source has an 

opportunity to mitigate its adverse impact in order to receive 

its PSD permit. A device that has been used to mitigate adverse 

impacts is to require emissions offsets as a condition for 

granting the permit. 

Goals: Propose recommendations as to the range of measures that 

should be considered for new major sources to mitigate their own 

Class I adverse impacts. 

Questions: 

1. What specific criteria can be developed for determining 

appropriate offsets to mitigate Class I area impacts of new 

sources? 

2. What specific mitigation measures (e.g., offsets, LAER) 

should be considered for sources locating in the vicinity of 

Class I areas already experiencing, or projected to 

experience, adverse impacts on AQRV's? Should the measure 

be shown to be directly related to the particular impact? 

3. What role can pre-construction or post-construction 

monitoring serve in areas where projected adverse impact 

from the proposed source is of concern? 
P.12 

BACT/LAER Determinations: BACT/LAER Clearinghouse and 

"Presumptive" BACT 

Description: Currently there is no single comprehensive 

repository of BACT/LAER technology information which permitting 

agencies, applicants and the public can access to provide a 

common basis for selecting and comparing BACT/LAER technologies. 

This leads to uncertainty regarding the control options which are 

available to the sources. In addition, regulated parties have 

expressed the need for updates to the information in the 

clearinghouse so that all parties are aware of whether the source 

has actually been constructed and how effective and costly the 

control technology is in practice. Consideration of new or 

improved BACT (and LAER) technologies which may become available 

only after a permit application has been submitted can create 

additional uncertainty in the technology review. Current policy 

requires consideration of new technologies for BACT and LAER 

until the permit issuance date, and some subcommittee members 

have asserted that this causes delays in the issuance of some 

permits and have also expressed concern about the consideration 

of technology from other countries, because of differing 

environmental regulations and potentially unproven performance of 

technology. 

Balancing these concerns, environmental groups and the 

public have expressed interest in greater opportunity to review 

and comment on control technology dete:rminations. Often the 

public first learns of the proposed technology for a source 

shortly before or during the public comment period on a proposed 

permit. 

The BACT analysis is a source specific, case-by-case 

analysis. Some members of the subcommittee have shown interest 

in the development of a national "presumptive" BACT for 

individual source categories for the purpose of both streamlining 

and adding more certainty to the BACT selection process. 

Goals: Propose recommendations for improvements in collecting, 

characterizing and disseminating control technology information 

including how the information clearinghouse can be kept current. 

Evaluate the feasibility, including the impact on the BACT 

process, of presumptive BACT for individual source categories. 

Questions: 

1. What revisions and improvements to the RACT/BACT/LAER 

Clearinghouse (RBLCH) can be implemented to ensure a 

comprehensive, all-inclusive data base and what mechanisms 

exist to ensure the RBLCH is current with respect to 

available technologies and the costs and performance of 

technologies once they are in operation? 
P.13 

8 

2. How would a presumptive BACT/LAER be established and how 

would the development of new or improved control 

technologies be factored into a presumptive BACT/LAER to 

ensure it remained current? 

3. Is there a way to reconcile the case-by-case and technologyforcing nature of BACT with a "presumptive- or guideline 

control technology determination for a category of sources? 

Should EPA simply identify what is currently the most 

stringent technology and identify that as presumptive BACT? 

4. What additional mechanisms exist to involve the public early 

in the control technology review? 

5. How should technology demonstrated outside of the U.S. be 

considered for BACT or LAER purposes? 
P.14 

BACT/LAER Determinations: BACT/LAER Criteria 

Description: In brief, EPA current guidance on BACT provides that 

all available control technologies be ranked in descending order 

of control effectiveness. The PSD applicant first examines the 

most stringent—or "top"—alternative. That alternative is 

established as BACT unless the applicant demonstrates, and the 

permitting authority agrees, that technical considerations, or 

energy, environmental, or economic impacts justify a conclusion 

that the most stringent technology is not "achievable" in that 

case. If the most stringent technology is eliminated in this 

fashion, then the next most stringent alternative is considered, 

and so on. 

The LAER is the most stringent emission limitation derived 

from: 1) the most stringent limitation contained in the 

implementation plan of any State for such class or category of 

source; or 2) the most stringent emission limitation achieved in 

practice by such class or category of source. 

While the existing procedures for consideration of 

technologies (starting with the most stringent) appear to be 

relatively straightforward, there are differences of opinion as 

to the appropriate factors to be considered in determining what 

constitutes BACT and in some cases LAER. 

Goals: To identify, within the framework of EPA's current BACT 

and LAER policies, proposed clarifications or additional specific 

guidance that would add more certainty to and streamline the BACT 

and LAER analyses. 

Questions: 

1. Is it appropriate for the financial condition or competitive 

position of a company to play a role in the BACT or LAER 

analysis? If yes, how? 

2. What criteria are appropriate for determining if an 

otherwise demonstrated technology is a candidate for 

technology transfer? 

3. In terms of EPA involvement in the BACT analysis, what type 

of practice should EPA implement regarding when a technology 

is or is not available for BACT consideration purposes? How 

should a cutoff date be implemented for the purpose of 

limiting what is an available control technology for 

consideration in the BACT processes? 

4. What additional specific guidance on environmental, energy 

and economic impacts would add more certainty to, or 

otherwise improve, the BACT analysis process, while still 

promoting the use of state-of-the-art controls technologies? 
P.15 

10 

5. To what extent is it appropriate for the BACT analysis to 

require the source to consider other alternatives to the 

source configuration that are either inherently less 

polluting (e.g., alternative fuels or processes) or provide 

an overall environmental benefit? 

6. What improvements can be made to the LAER requirement to 

provide applicants with more flexibility in achieving or 

otherwise complying with state-of-the-art emission levels? 
P.16 

11 

BACT/LAER Determinations: Innovative Control Technology and 

Pollution Prevention 

Description: Some members of the subcommittee identified the 

need for additional guidance on how innovative control technology 

and pollution prevention could be incorporated into new source 

review (NSR). 

The NSR rules, 40 CFR 51.166 (s) and 40 CFR 52.21 (v), 

provide a mechanism for permitting an innovative control 

technology. To obtain approval for an innovative control 

technology, the owner or operator of a proposed major stationary 

source or major modification must petition EPA's Administrator in 

writing before the close of the public comment period. The* 

owner/operator must agree to achieve a level of continuous 

emissions reduction equivalent to that which would be required if 

BACT was installed. Additional requirements are outlined in 

these two portions of the NSR rules. To date, requests for 

innovative control technology waivers have been limited. 

The Pollution Prevention Act of 1990 defined pollution 

prevention as "any practice which reduces the amount of any 

hazardous substance, pollutant or contaminant entering any waste 

stream or otherwise released into the environment." In a 

memorandum dated June 15, 1993, Carol Browner, EPA Administrator, 

outlined the Agency's position on pollution prevention. In this 

memorandum, Ms. Browner committed EPA to integrating pollution 

prevention into every EPA activity, program, and operation. 

Goals: Propose recommendations for improving the utilization of 

the innovative control technology waiver and incorporating 

consideration of pollution prevention projects in evaluation of 

what constitutes BACT or LAER. 

Questions: 

1. What changes to the current PSD innovative control waiver, 

if any, can be made to encourage development of innovative 

controls and strategies? 

2. How can pollution prevention and the benefits they offer be 

recognized and encouraged in BACT/LAER determinations? 

3. What special considerations, if any, can be provided for 

innovative control technologies when applied as LAER?