Interagency Working Comments on Draft Rule under EO 12866 8/2/2010

Page 1of 3 Below are additional working comments from the interagency review of the draft rule titled, “National Emission Standards for Hazardous Air Pollutants for Reciprocating Internal Combustion Engines--Existing Stationary Spark Ignition (Gas-Fired).”

Comments:

 Limited Use Engines : Can EPA explain why limited use engines only includes start up combustion turbines? For instance, there are limited use nonemergency SI engines, just as there were in the CI Rule. Some of these are operated only periodically – some transmission lines include small stations that run very infrequently – i.e., only operate when there is significant gas demand (or for routine engine checks) and may not run at all or only a few hours in some years. These should be treated as emergency engines – there will be more time spent on testing/evaluation than there may be operating.

o A commenter suggests a broader definition for limited use engines or state why EPA isn’t at this time providing more relief for other limited use engines.

o Also suggested is one time testing for these engines, rather than more frequent testing.

 Limited Use Engines : A commenter adds that given that EPA is already re-considering limited use nonemergency CI engines, in response to requests for reconsideration, EPA should state that it is reconsidering this is sue and should specifically solicit comments on how to handle nonemergency limited use engines – CI and SI, so that it can better formulate a new proposal, going forward.

 Cost of Control : I’ve been able to determine that EPA used the annual cost of testing (p.4 , June 29 th EC/R memo) as part of the total annual cost (TAC). This, I believe, is
due to the fact that EPA assumes annual ca talyst washing and replacement, which triggers an additional performance test – so that there are three tests in every three years, instead of one. For the major sources, since there are annual testing costs in the major source floor baseline, TAC is not included in the annual cost for the above the floor calculation. However, as a practical matter, the additional annual cost of testing of $3946 testing/monitoring etc. per year is still par t of the cost of achieving the incremental cost of achieving the emission reductions for the 4 SRB 300-500 HP major source engines, and EPA should not eliminate this incr emental cost because it is part of the
floor costs. This is true because EPA stat es that there are no incremental emission reductions in the floor, so EPA would be properly reporting the incremental costs over the status quo if it included ATC. Thus, EPA underestimates the major cost above the floor annual costs by approximately $3946/year using this protocol.

o A commenter suggest that EPA should apply the additional $4000/year testing/monitoring etc. cost to both major and area source calculations for 4SRBs, and not to area sources alone, which EPA appears to have done.

 Annual Testing Costs:Interagency Working Comments on Draft Rule under EO 12866 8/2/2010

Page 2of 3 o Can EPA clarify the source of the documentation of the testing/monitoring etc. annual cost of $3,946 (found in the SI Engine Control Cost and Cost per Ton Summary Spreadsheet). Since the test itself is $1000/engine, what is the basis for the remaining monitoring/recordkeeping etc. being $2,946?

o Does EPA agree that it should also include the $4000/year ATC cost to major source calculations as part of the 4SRB cost effectiveness calculation since the status quo now reflects no regulation of existing engines?

 Requirement to Monitor Pressure and Temperature – Oxidation Catalysts and
NSCRs : Comments from OIPA included the following statement: “EPA proposes that operators monitor the pressure drop across the catalyst and the temperature of the exhaust so they meet the proposed operating limitations for RB engines. Again, most crude oil and natural gas facilities are located in remote, rural areas, sometimes many hours from the home or field offices. Many of the facilities do not have electricity to monitor or record exhaust temperature or the pressure drop across the catalyst. We don’t think EC/R has accounted for running electricity to a facility and request this cost be included in the analysis.”

o Can EPA explain how they addressed this comment? We suggest removing this requirement for remote facilities.

 Hourly Meters : Comments from OIPA included the following statement: “According to the preamble, existing engines located at area sources that are subject to management practices are required to record fuel consumption and hour data shown on the hour meters. Typically, in Oklahoma, natural gas produced from the well is used to run the engines at the facility, and there are no meters installed to record fuel consumption. To determine fuel usage for small engines like pump jacks, operators typically use the manufacturer’s data to calculate that information. The requirement to install a fuel meter will only increase capital, maintenance, and replacement costs without any environmental benefit. Also, hour meters are not installed on these types of engines either. In addition, EPA does not specify the frequency that this data is to be kept i.e. hourly, weekly, monthly, etc. The proposed r equirement will be unnecessarily costly and burdensome on small businesses and those companies that operate marginal crude oil and natural gas wells that operate on the lower edge of profitability. We request EPA remove these requirements for engines less than 500 HP that are located at area
sources.”

o Can EPA explain how they addressed this comment?

Previous RIA comments:

RIA

1) The RIA should include the summary of analysis of regulatory alternatives. A table to allow comparison of analyzed alternatives would be helpful to show compliance with EO
12866 and Circular A-4Interagency Working Comments on Draft Rule under EO 12866 8/2/2010

Page 3of 3 2) The exec summary should briefly describe what the rule does. Suggest that Chap 4 first paragraph be coped to Exec Summ to briefly describe the what the rule does, followed by first two paragraphs in 4.2.2. 3) Could EPA please insert some brief description of the regulated objects and how they are used, both in the Exec Summary and also the beginning of Chapter 3 (which discusses the industries, but now the equipment)? 4) Early in the document, including both Exec Summ and early in both cost and benefit chapters, the RIA should provide a bulleted list of uncertainties associated with the analysis and assumptions required to develop these estimates. 5) Since there are no NOx reductions for the MACT floor, the reference to non-monetized NOx reductions should be removed from Table 1-1 and any other table that presents a summary of the benefits for the MACT floor. 6) The RIA should outline how estimates of benefits-per-ton were developed, including the source of the key analytic inputs, assumptions, and uncertainties. The current draft does not explain the tons reduced, whether all sources are assumed to the same, how precursors are related to PM concentrations, and how estimates take into account the tremendous geographic diversity in population density etc. Is there a description somewhere that can help the reader navigat e how EPA modeled or measured PM from precursors? Throughout, it is difficult to identify how EPA separately analyzed emitted PM, PM formed from precursors, and gaseous SOx or NOx. 7) Could EPA please clarify that only PM benefits are quantified, and that they are quantified by precursor? Particularly in the labeling of charts and graphs. 8) P 3-1 What is the significance of years 2002 and 2007 in the second paragraph of 3.1.1? The choice of specific years without reference to what happened prior to those years or between seems random, particularly since figure 3-1 seems to show a possible trend flattening in the later years. 9) Suggest Figure 3-2 should show values, not just bubbles. 10) P 3-5 reads “In less regulated companies ...” does EPA mean to say “fewer ... than”, or is the intent of the sentence to refer to the mathematical operation (2% less a value that is unclear