[exists;] If the Kentucky SIP does not contain an emissions limitation for a source or 

source category, the emissions offset baseline involving the source shall be actual 

emissions determined under actual operating conditions for the previous two (2) year 

period. 

(5) Calculating offsets for existing fuel combustion sources. 

(a) The emissions for determining emissions offset credit involving an existing 

fuel combustion source shall be the allowable emissions under the emissions limitation 

requirements of the cabinet for the type of fuel being burned when [cMbMmeJ the new 

major source or major modification application is filed. 

(b) If the existing source has switched to a different type of fuel at some eartier 

date, a resulting emissions reduction, either actual or allowable, shall not be used for 

emissions offset credit. 

(c) If the existing source commits to switch to a cleaner fuel at some future date, 

emissions offset credit based on the allowable emissions for the fuels involved shall not 

be allowed unless the permit is conditioned to require the use of a specfled alternative 

control measure that will achleve the same degree of emissions reduction if the source 

switches bad to a dirtier fuel at some later date. 

(6) Calculating offsets for operating hours and source shutdowns. 

(a) A source may be credited with emissions teduct'i)ns achieved by shutting 

down an existing source or permanently curtailing production or operating hours below 

baseline levels if the work force to be affected has been notified in writing of the 

proposed shutdown or curtailment. 

(b) Soum shutdowns and curtailments in production or opemting hours 
occurring prior to the date the new source application is filed shall not be used for 

emissions offset credit. 

(c) If an applicant can establish that it shut down or curtailed production after 

August 7, 1977, or less than one (1) year prior to the date of pernit application, 

whihever is earlier, and the proposed new source is a replacement for the shutdown or 

curtailment, credit for the [SOtGk] shutdown or curtailment may be applied to offset 

emissions from the new source. 

(7) Calculating offsets for hydrocarbon substitution. An emissions offset credit 

shall be allowed for replacing one volatile organic compound with another of lesser 

photochemical reactivity, unless the replacement compound is methane, ethane, 1.1.1- 

trichloroethane. or 1-1 trichIoTOfluomethane. 

(8) Banking of emissions offset credit. 

(a) New sources obtaining permits by applying offsets after the effective date of 

this administrative regulation may bank offsets that exceed the requirements of Section 

5(3) of this administrative regulation. 

(b) An owner or operator of an existing source that reduces its own emisdons 

may bank a resulting reduction beyond those required by negulation for use under this 

administrative regulation, even if the offsets are applied immediately to a new source 

permit. 

(c) Banked emissions offsets may be used under the preconstmdion review 

program required in 42 U.S.C. 7401 to 7626, as long as these banked emissions are 

identffied and accounted for in Kentucky's control strategy. 

(9) Offset Mi for meeting NSPS or NESHAPS. 

(b) An internal emissions offset shall be included and made enforceable as a 

condition of the source's permit. 

(c) An external emissions offset shall only be accepted if the cabinet requires the 

affected source to comply with a new emissions limitation to ensure that its emissions 

shatl be reduced by a specified amount in a specified time; and the new emissions 

limitation shall be enforceable by the cabinet and the U.S. EPA. 

(3) Cabinet initiated emissions offsets. 

(a) The cabinet may commit to reducing emissions fmm mobile sources and 

other existing sources to provide a net air quality benefit in the impact area of a 

proposed new source to accommodate the proposed new source. 

(b) This emissions reduction commitment shall be reflected in the emissions 

fitnitation requirements for the new and existing sources as requimd by this section. 

Section 7. Source Obligation. (1) An owner or operator of a source or 

modification subject to this administrative regulation shali construct and opefate the 

source or modification in accordance with the application submitted to the cabinet under 

this administrative regulation and 401 KAR 52:020 or under the terms of an approval to 

construct. 

(2Xa) Appmval to construct shall become invalid if construction: 

1. Is not commenced within eighteen (18) months after receipt of the approval; 

2. Is discontinued for a period of eighteen (1 8) months or more; or 

3. Is not completed within a reasonable time. 

(b) The cabinet may extend the elghteen (18) month period upon a satisfactory 

demonstration [ekwkg] that an extension is justified. 
I. An extension shall not apply to the time period between construction of the 

approved phases of a phased construction project; and 

2. Each phase shall commence oonstruction within eighteen (18) months of the 

projected and approved commencement date. 

(3) Approval to construct shall not relieve an owner or operator of the 

responsibility to comply fully with applicable provisions of 401 KAR Chapters 50 to 

[a] and [w] other awlicable requirements under local, state, or federal law. 

(4) If a particular source or modification becomes a major stationary source or 

major modification solely by virtue of a relaxation in an enforceable limitation which was 

established after August 7, 1980, on the capaclty of the source or modification 

11 otherwise to emit a pollutant, the requirements of this administrative regulation shall 

12 apply to the source or modification as though construction had not yet commenced on 

13 the source or modification. 

14 @)(a) The pmvisions of this subsection shall apply to projects at existing 

15 emissions units at a major stationary source other than projects at a 

16 sourcewiihaPAL,if: 

17 1. There is a reasonable possibility that a project that is not part of a major 

18 modification may result in a signitimnt emissions increase; and 

19 2. The owner or operator uses the method specified in 401 KAR 51 :001, Section 

20 If199 WbH@W++)] to calculate projected actual emissions. 

21 (b) Before beginning actual construction of a project specified in paragraph (a) of 

22 this subsection, the owner or operator shall document and maintain a record of the 

23 following information: 
1. A description of the project; 

2. Identification of the emissions units for whi emissions of a regulated MSR 

pollutant may be affected by the project; and 

3. A description of the applicability test used to determine that the project is not a 

major modification for any regulated NSR pollutant, including: 

a. Baseline actual emissions; 

b. Pmjected actual emissions; 

c. Amount of emissions excluded in calculating projected actual emissions and 

an explanation for why that amount was excluded; and 

d. Any applicable netting calculations. 

(c) For a project specified in paragraph (a) of this subsection, the owner or 

operator shall: 

1. Monitor the emissions of any regulated NSR pollutant that could increase as a 

result of the project and that are emitted by an emissions unit identified in paragraph 

(a)2 of this subsection; and 

2. Calculate and maintain a record of the annual emissions, in tons per year on a 

calendar year basis, for: 

a. Five (5) years following resumption of regular operations after the change; or 

b. Ten (10) years if the project increases the design capacity of or potential to 

emit for that regulated NSR pollutant at the emissions unit. 

(d) If the unit is an existing EUSGU, before begtnning actual oonstmdion, the 

owner or operator. 

1. Shail provide a oopy of the infodin in paragraph (b) of this subsectinn to 
the cabinet; and 

2. Shall not be required to obtain a determination from the cabinet before 

beginning actual construction; and 

3. Shall submit a report to the cabinet within sixty (60) days after the end of each 

year during which records are required to be generated under paragraph (b) of this 

subdon that contains the unit's annual emissions during the calendar year preceding 

report submittal. 

(e)l. For an existing unit other than an EUSGU, the owner or operator shall 

submit a report to the cabinet if: 

a. The annual emissions, in tons per year, from a project identifiied in paragraph 

(a) of this subsectinn exceed the baseline actual emissions, as documented and 

maintained pursuant to paragraph (b)3 of this subsection, by a significant amount for 

that regulated NSR pollutant; and 

b. The emissions differ from the preconstrudion projection as documented and 

maintained pursuant to paragraph (b)3 of this subsection. 

2. The report shall be submitted to the cabinet within sixty (60) days after the end 

of the year during which records are required to be generated under paragraph (b) of 

this subsedlan and shall contain the following: 

a. The name, address, and telephone number of the major statinary source; 

b. The annual emissions as calculated pursuant to paragraph (c) of this 

subsection; and 

c. Any other information that the owner or operator wishes to include in the 

report. 
1 (f) The owner or operator of the source shall make the information required to be 

2 documented and maintained under this subsection available for review upon request for 

3 inspection by the cabinet or the general public pursuant to 401 KAR 52:100. 

4 Section 8. Permit Condition Rescission. (7) An owr or operator holding a 

5 permit for a stationary source or modification that [W] was issued pursuant to 401 

6 KAR 51:050 or [4@WAR] 51:051E may request that the cabinet rescind the applicable 

7 conditions. 

8 (2) The cabinet shall rescind a permit mnditiin if the owner or owrator. 

9 la) Requests and ri] demonstrates to the 

10 satisfaction of the cabinet that this administrative regulation does not apply to the 

11 source or modifcation or to a portion of the source or mod'ication if construction will 

12 have commenced after September 22,1982; and 

13 fb) Demonstrates [[I that the 

rescission will not violate the requirements of Sections 4(3) and 7 of this administrative 

regulation. 

Section 9. Class I Areas. (I) The following areas& [weas] which were in 

existence on August 7,1977, shall be Class I areas and shall not be redesignated: 

(a) International parks; 

(b) National wilderness areas and national memorial parks which exceed 5,000 

acres in size; and 

(c) National parks that exceed 6,000 am insize. 

(2) Any other area, unless otherwise specifii in the legislation creating the area, 

is designated Class I/ but may be redesignated as provided in 40 C.F.R 51.166(g). 
(3) The visibility pmtection requirements of this administrative regulation shall 

apply only to sources that may impad a mandatory Class I federal area. 

(4) The following areas may be redesignated only as Class I or II: 

(a) An area which as of August 7,1977, exceeded 10,000 acres in size and was 

a national monument, a national primitive area, a national preserve, a national 

recreational area, a national wild and scenic river, a national wildlife refuge, a national 

lakeshore or seashore; and 

(b) A national park or national wilderness area established after August 7, 1977, 

which exceeds 10,000 acres in size. 

Section 10. Protection of Visibility. (1) New source review; [twbw-] applicability 

and exemptions. 

(a) A stationary source or modification to which this section applies shall not 

begin actual consbudion without a permit that states the stationary source or 

modification shall meet the requirements of this section. 

(b) This section shall apply to construction of a new major stationary source or 

major modification that will be constructed in an area designated as nonattainment 

under 42 U.S.C. 7407(d)(l KAXi) and potentially have an impact on visibility in a Class I 

area. 

(c) This section shall apply to a major stationary source or major modification for 

each poljutant subject to regulation under 42 U.S.C. 7401 to 7626 that it will emit, 

except as provided in paragraphs (d) and (e) of this subsection. 

(d) This section shalt not apply to a particular major stationary source or major 

modification if: 
1. The source or modification is a nonprofit health or nonprofit educational 

institution, or a major modification will occur at the institution, and the Governor of the 

Commonwealth requests that it be exempt from the requirements of this section; and 

2. The source is a portable stationary source that has previously received a 

permit under this section and will be temporarily r€?kmted: and: 

a. I-] The emissions fmm the source will not exceed the allowable 

emissions; 

b. The emissions from the source will not impact a Class 1 area or an area where 

an applicable increment is known to be violated; and 

c. Reasonable notice is given to the cabinet prior to the relocation, identifying the 

proposed new location and the probable duration of operation at the new location. The 

notice shall be given to the cabinet not less than ten (10) days in advance of the 

proposed relocation unless a different time duration is previously approved by the 

cabinet Pursuant to this section. [6abkek] 

(ej This section shall not apply to a major stationary source or major rnodit"icati0n 

with respect to a particular potlutant, if the altowable emissions of that pollutant from the 

source, or the net emissions increase of that pollutant from the modification: 

1. Wilf not impact a Class I area; 

2. Will not impact an area where an applicable increment is known to be violated; 

and 

3. Will be temporary. 

(2) Visibilii impact analyses. The owner or operator of a source shall pmvide an 

analysis of the impairment to visibility that will occur in a Class I area as a result of the 
source or modification and general cornmetcia!, residential, industrial, and fWw#fbl 

-1 other growth assodated with the soum or modification. 

(3) Federal land manager notification. 

(a) The federal land manager and the federal official charged with direct 

responsibility for management of Class I areas have an affirmative responsibility to 

proted the visibility and other air quality related values of the Class I Iands and to 

consider, in consultation with the cabinet, if a proposed source or modification will have 

an adverse impact on these values. 

(b) The cabinet shall provide written notiition to all affected federal land 

managers and to the federal official charged with direct responsibility for management 

af fands within the Class I area of a permit application or an advanced notii of a permit 

applmtion for a proposed new major statiinary source or major modification that may 

affect visibility in a Class I area. The notifion shall: 

1. Include a copy of all information relevant to the permit application; 

2. l3e submitted pursuant to this paragraph 1-1 within thirty 

(30) days of receipt of the permit application or advanced notick of permit application 

and at least sixty (60) days prior to a public hearing on the application for a permit to 

oonstrud; and 

3. Include [idde] an analysis of the proposed source's anticipated impacts on 

visibility in a Class I area. 

(c)l. The cabinet shall consider an analysis by the federal land manager, 

pcovided within thirty (30) days of the notifition and analysis required by paragraph (b) 

of this subsection, that the proposed new major stationary souroe or major modifition 
1 may have an adverse impact on visibility in a Class I area. 

2 2. If the cabinet finds that the analysis does not demonstrate, to the satisfaction 

of the cabinet, that an adverse impact on visibility will result in the Class I area, the 

cabinet shall, in the public hearing notice required in 401 KAR 52:100, either explain 

that decision or give notice as to where the explanation can be obtained. 

(d) Adverse impact on visibility as it applies to paragraph (c) of this subsection 

shall be determined on a case-by-case basis, taking into account the geographic extent, 

intensity, duration, frequency, and time of visibility impairments, and how these factors 

correlate with the times of visitor use of the Class I area, and the frequency and time of 

natural conditions that reduce visibility. 

(4) Public participation. The cabinet shall follow the applicable procedures of 401 

KAR 52:100 in processing applications under this section and 1-1 

shall follow the procedures at 40 C.F.R. 52.21h1, effective [-I July 

1,2003, to the extent that the procedures of 401 KAR 52:100 do not apply. 

(5) National visibility goal. 

(a) The cabinet shall only issue permits to those sources for which emissions will 

be consistent with making reasonable progress toward the national goal of preventing 

krture, and remedying existing, impaiment of visibility in Class I areas which impairment 

resutts from manmade air pollutian. 

(b) In making the decision to issue a permit, the cabinet may take into account 

the overriding factors of: 

I. The cost of compliance; 

23 2. The time necessary for compliance; 
3. The energy and non-air [rwak] quality environmental impacts of compliance; 

and 

4. The useful Ilfe of the source. 

(6) Monitoring. 

(a) The cabinet may require monitoring of visibility in a Class I area near the 

proposed new stationary source or major modification using human observations, 

teleradiometers, photographic cameras, nephelometers, fine particulate monitors, or 

other appmpriate met hods as specified by the U.S. €PA. 

(b) The monitoring method selected shall be determined on a case-by-case basis 

by the cabinet. 

(c) The cabinet shall not undertake visibility monitoring in a Class t area without 

the approval of the federal land manager. 

(d) Data obtained from visibility monitoring shall be made available to the cabinet, 

the federal land manager, and the U.S. €PA, upon request. 





















CI 

Section ll.J14;1 Plant-wide Applicability Limit Provisions. The cabinet may 

approve the use of an actuals PAL (PAL) for an existing major stationary source if the 

PAL meets the requirements of this section. 
(1) General provisions. 

(a) An owner or operator may execute a project without triggering major NSR, if 

the source maintains its total source-wide emissions below the PAL level, meets the 

requirements in this section, and complies with the PAL permit. If these conditions are 

met, a project: 

1. Shall not be considered a major modification for the PAL pollutarrt; 

2. Shall not have to be approved through Kentucky's major NSR program; and 

3. Shall not be subject to the provisions of Section 7(4) of this administrative 

regulation concerning restrictions on relaxing enforceable emissions limitations that the 

major stationary source used to avoid applicability of the major NSR program. 

(b) Except as provided under subparagraph (I)(a)3 of this section, the major 

stationary source shall continue to comply with all applicable federal or state 

requirements, emissions limitations, and work practice requirements that were 

established prior to the effective date of the PAL. 

(c) The cabinet shall not allow a PAL for VOC or NOx for any major stationary 

source located in an extreme ozone nonattainment area. 

(2) Permit application requirements. The owner or operator of a major stationary 

source shall submit the following information to the cabinet for appmval as part of an 

application for a permit or permit revision requesting a PAL: 

(a) A list of ail emissions units at the source designated as small, significant or 

major, based on their potential to emit; 

(b) Identification of the federal and state applicable requirements, emissions 

limitations, and work practice requirements that apply to each emissions unit; 
(c) Calculations of the baseline actual emissions for the emissions units with 

supporting documentation; and 

(d) The calculation procedures the owner or operator proposes to use to convert 

the monitoring system data to monthly emissions and annual emissions based on a 

twelve (12) month rolling total for each month as required by subsection (12)(a) of this 

section. 

(3) Establishing a PAL. The cabinet shall establish a PAL at a major stationary 

source in a federally enforceable permit pursuant to the requirements of this section. 

(a) The PAL shall impose an annual emissions limitation in tons per year that is 

enforceable as a practical matter for the entire major stationary source, in which: 

w9=+3 

1. For each month during the PAL effective period after the fimt twelve (12) 

months of establishing a PAL, the owner or operator shall demonstrate jskevr] that the 

sum of the monthly emissions from each emissions unit under the PAL for the previous 

twelve (12) consecutive months is less than the PAL as a twelve (12) month average, 

rolled monthly; and 

2. For each month during the first eleven (11) months from the PAL effective 

date, the owner or operator shall demonstrate [skew] that the sum of the preceding 

monthly emissions from the PAL effective date for each emissions unit under the PAL is 

less than the PAL; 

(b) The PAL shall be established in a PAL permit that: 

1. Meets tl?e public parkipation requirements in subsection (4) of this section; 

and 
2. Contains all the requirements of subsection (6) of this sedion; 

(c) A PAL shall include fugitive emissions, to the extent quantifiable, from all 

emissions units that emit or have the potential to emit the PAL pollutant at the major 

stationary source; 

(d) Each PAL shall regulate emissions of only one (1) pollutant; 

(e) Each PAL shall have a PAL effective period of ten (1 0) years; 

(f) The owner or operator of a major stationary source with a PAL shall comply 

with the monitoring, recordkaeping, and reporting requirements of subsections ill) to 

(13) of this section for each emissions unit under the PAL through the PAL effective 

period; and 

(g) Emissions reductions of a PAL pollutant that occur during the PAL effective 

period shall not be creditable as decreases for offsets under 40 C.F.R. 51.165(aX3XiI), 

unless: 

2. The level of the PAL is reduced by the amount of [&] emissions 

reductions; and 

2.' The redudions would be creditable in the absence of the PAL. 

(4) Public participation requirements. PALS for existing major stationary sources 

shall be established, renewed, or increased pursuant to this subsection and the 

applicable procedures of 4.0 1 KAR 52:lOO for issuing permits or permit revisions. The 

cabinet shall: 

(a) Pmvide the public with notice of the pmposed approval of a PAL permit with 

22 at least a thirty (30) day period for submittal of public comment; and 

23 (b) Address all material comments before taking final action on a PAL permk or 
permit revision. 

(5) Setting the ten (10) year PAL level. 

(a) The PAL level for a mapr statiinary source shall be the sum of the baseline 

actual emissions of the PAL pollutant for each emissions unit at the source during the 

chosen twenty-four (24) month period plus the applicable significant level for the PAL 

pollutant under the definition for "significant" in 401 KAR 51 :001, Section I [w] or 

under 42 U.S.C. 7401 -7871 q, [tbeA&] whichever is lower. 

(b) In establishing a PAL level for a PAL pollutant, only one (1) consecutive 

twenty-four (24) month period shall be used to determine the baseline actual emissions 

for all existing emissions units. 

(c) A different consecutive twenty-four (24) month period may be used for each 

different PAL pollutant. 

(d) Emissions associated with units that were permanently shutdown after the 

chosen twenty-four (24) month period shall be subtracted fmm the PAL level. 

(0) Emissions from units for which actual oonstNCf'in began after the twenty-four 

(24) month period shall be added to the PAL level in an amount equal to the potential to 

emit of the units. 

(f) The cabinet shall spec@ a reduced PAL level in the PAL permit to become 

effectii on the future compliance date of any applicable federal or state regulatory 

requirement that the cabinet is aware of prior to issuance of the PAL permit. 

(6) Contents of the PAL permit. The PAL permit shall contain the following 

information: - 

(a) The PAL pollutant and the applicable source-wide emissions limitation in tons 
Per year; 

(b) The PAL permit effective date and the expiration date of the PAL or Pa 

effective period; 

(c) Specification in the PAL permit that if a major stationary source owner or 

operator applles to renew a PAL under subsection (9) of this section before the end of 

the PAL effective periiid, the PAL shall remain in effect until a revised PAL permit is 

issued by the cabinet; 

(d) A requirement that emissions calculations for compliance purposes indude 

emissions from stamps, shutdowns, and [- malfunctions; 

(e) A requirement that, once the PAL expires, the major stationary source &g@ 

- be [is] subject to the requirements of subsedin (8) of this section; 

(f) The calculation procedures that the major stationary source owner or operator 

shall use to convert the monitoring system data to monthly emissions and annual 

14 emissions based on a twelve (12) month rolling total for each month as required by 

1 5 subsection (1 2Xa) of this section; 

16 (g) A requirement that the major stationary sourn owner or operator shall 

17 monitor all emissions units in accordance with the provisions in subsection (12) of this 

18 section; 

19 (h) A requirement that the owner or operator shall retain the records required 

20 under subsection (12) of this section on site. Records may be retained in an electronic 

C 

21 format or another acceptable format approved by the cabinet; 

22 . (1) A requirement for the owner or operator to submit,' by the reports required 

23 under subsection (1 3) of this section by the required deadlines; and 

51 
(j) Any [Q#wJ requirements necessary to implement and enforce the PAL. 

(7) PAL effective period and reopening of a PAL permit. 

(a) A PAL effective period shall be ten (10) years. 

(b) The cabinet shall reopen a PAL permit to: 

1. Correct typographical or calculation errors made in setting the PAL; 

2. Reflect a more accurate determination of emissions used to establish the PAL; 

3. Reduce the PAL if the owner or operator of the major stationary source 

creates creditable emissions reductions for use as offsets under 4.0 C.F.R. 

51 .165(a#3)(ii); or 

4. Revise the PAL to reflect an increase in the PAL according to subsection (10) 

of this section. 

(c) The cabinet may reopen the PAL permit, during the PAL effective period, to: 

1. Reduce the PAL to reflect newly applicable federal requirements with 

compliance dates after the PAL effedie date; 

2. Reduce the PAL consistent with any other requirement: 

a. That is enforceable as a practical matter, and 

b. That may be imposed on the major stationary source under the SIP; and 

3. Reduce the PAL if the cabinet determines that a reduction is necessary to 

avoid cawing or contributing to: 

a. A National Ambient Air Quality Standard (NAAQS) or PSD increment violation; 

or 

b. An adverse impact on visibility or another air quality related value that has 

been identifled for a federal Class 1 area by a federal land manager and for which 
information is available to the general public. 

(d) All permit reopenings shall be carried out under the public participation 

requirements of subsection (4) of this section except for permit reopenings to correct 

typographical or calculation of errors that do not increase the PAL level. 

(8) Expiration of a PAL. A PAL that is not renewed shall expire at the end of the 

PAL effective period and the requirements of this subsdon shall then apply. 

(a) Each emissions unit, or each group of emissions units, that existed under the 

PAL shall comply with an allowable emissions limitation under a revised permit 

established as follows: 

1. An owner or operatar of a major statbnary source using a PAL shall submit a 

proposed allowable emissions limitation for each emissions unit, or each group of 

emissions units, by distributing the PAL allowable emissions for the major stationary 

source among each of the emissions units that existed under the PAL. 

a. This proposal shall be submitted to the cabinet at least six (6) months before 

the expiration of the PAL permit but not sooner than eighteen (18) months before permit 

expiration. 

b. If the PAL has not yet been adjusted for an applicable requirement that 

became effective during the PAL effective period, as required under subsection (QHe) of 

this section, distribution of allowable emissions shall be made as if the PAL has been 

adjusted. 

2. me cabinet shall pmvide [BgdBe] the date and procedure the owner or 

operator shall use to distribute the PAL allowable emisdons. 

3. The cabinet shall issue a revised pemit incorporating allowable limits for each 
emissions unit, or each group of emissions units, as the cabinet determines is 

appropriate. 

(b) Each' emissions unit shall comply with the allowable emissions limitation on a 

twelve (12) month tolling basis. The cabinet may approve the use of monitoring systems 

other than CEMS, CERMS, PEMS. or [FGMS-w] CPMS to demonstrate compliance 

with the allowable emissions limitation. 

(c) The source shall continue to comply with a source-wide, muhiunit emissions 

cap equivalent to the level of the PAL emissions limitation until the cabinet issues the 

revised permit incorporating allowable limits for each emissions unit or each group of 

emissions units. 

(d) A major modification at the major stationary source shall be subject to major 

NSR requirements. 

(e) The major stationary source owner or operator shall continue to comply with 

any state or federal applicable requirements eliminated by the PAL that applied during 

or before the PAL effective period, except for those emissions limitations established 

pursuant to Section 7(4) of this administrative regulation. 

(9) Renewal of a PAL. 

(a) Public participation requirements. 

1. The cabinet shalt follow the public participation procedures specified in 

subsection (4) of this section in approving a request to renew a PAL for a major 

stationary source. 

2. The cabinet shall provide a written rationafe for the proposed PAL level for 

public review and comment. 
3. Any person may propose a PAL level for the source for consideration by the 

cabinet during the public review period. 

(b) Application deadline. 

I. A major stationary source owner or operator shall submit an application for 

renewal of a PAL at least six (6) months before the date of permit expiration but not 

earlier than eighteen (1 8) months before permit expiration. 

2. The deadline for application submittal shalt ensure that the permit shall not 

expire before the permit is renewed. 

3. If a complete application for renewal is submitted within the timeframe 

specified in subparagraph 1 of this paragraph, the PAL shall continue to be effective 

until the revised pernit with the renewed PAL is issued. 

(c) Application requirements. The application to renew a PAL permit shall 

contain: 

1. The information required in subsection (2) of this din; 

2. A proposed PAL level; 

3. The sum of the potential to emit of all emissions units under the PAL with 

supporting documentation; and 

4. Any other information the owner or operator wishes the cabinet to consider in 

determining the appropriate level to renew the PAL. 

(d) PAL adjustment. 

1. A PAL shall not exceed the source's potential to emit The cabinet shall adjust 

the PAL downward to a level [w] greater than the potential to emit if a soufcek 

potentiat to emit has declined below the PAL level. 
2. The cabinet may renew'the PAL at the same level as the current PAL wlthout 

considering the factors specified in subparagraph 3 of this section, if the emissions level 

calculated according to subsection (5) of this section is equal to or greater than eighty 

(80) percent of the PAL level; or 

3. The cabinet may set the PAL at a Ievel that is determined to be: 

a. More representative of the source's baseline actual emissions; or 

b. Apprupriate considering the following factors: 

(i) Air quality needs; 

(ii) Advances in control technology; 

(iii) Anticipated economic growth in the area of the source; 

(iv) The cabinet's goal of promoting voluntary emissions reductions; and 

(v) Other factors as specifically identified by the cabinet in its written rationale for 

setting the PAL level. 

4. The cabinet shall not approve a renewed PAL level higher than the current 

PAL, unless the major stationary source has complied with the pmvisions of subsection 

(1 0) of this section. 

(e) The PAL shall be adjusted in coniunctin with the [- PAL permit 

renewal or Tile V permit renewal, whichever comes first, t 

1. The compliance date for a state or federal applicable requirement that applies 

to the PAL source occurs during the PAL effective period; and 

2. The cabinet has not already adjusted for [a&] requirement. 

(10) increasing a PAL during the PAL effective period. The cabinet may increase 

a PAL emissions limitation during the PAL effective period if the major stationary source 
complies with the provisions of this subsection. 

(a) Application procedures. To request an increase in the PAL limit for a PAL 

major modffication, the owner or operator of the major stationary source shall submit a 

complete application, which shall include: 

1. Identification of the emissions units contributing to the increase in emissions 

for the PAL major modification; 

2. Demonstration that increased PAL, as calculated in paragraph (c) of this 

subsection exceeds the PAL, and: 

a. The level of control that results from BACT equivalent controls on each 

significant or major emissions unit shall be determined by conducting a new BACT 

analysis when [aHb-the] the application is submitted, unless the emissions unit is 

currentfy required to comply with a BACT or LAER requirement that was established 

within the preceding ten (10) years. 

b. If an emissions unit currently complies with BACT or LAER, the assumed 

control level for that emissions unit shall be equal to the current level of BACT or LAER 

for that emissions unit; and 

3. A statement that the increased PAL level shad be effective on the day any 

emissions unit that is part of the PAL major modification becomes operational and 

begins to emit the PAL pollutant. 

(b) NSR permit and compliance requirement. The owner or operator shall obtain 

a major NSR permit for all emissions units contribMng to the increase in emissions for 

the PAL major modification. 

I. A significant level shall not apply in deciding for which emissions units a dor 
NSR permit shall be obtained; and 

2. Emissions units that obtain a major NSR permit shall comply with any 

emissions requirements resulting from the major NSR process, even though the units 

shall also become subject to the PAL or shall continue to be subject to the PAL. 

(c) Calculation of increased PAL. The cablnet shall calculate the new PAL as the 

sum of the allowable emissions for each or new emissions unit, plus the sum 

of the baseline actual emissions of the significant and major emissions units assuming 

application of BACT equivalent controls, plus the sum of the baseline actual emissions 

of the small emissions units. 

(d) Public notice requirement. The public notice requirements of subsectin (4) of 

this sediion shall be followed during PAL pemlt revision for an increased PAL level. 

(I 1 ) Monitoring requirements for PALS. 

(a) General requirements. 

I. Each PAL permit shall contain enforceable requirements for the chosen 

monitoring system that accurately determines plant-wide emissions of the PAL pollutant 

in terms of mass per unit of time; 

2. A monitoring system authorized for use in the PAL permit shall be: 

a. Approved by the cabinet pursuant to this subsection; [abhet+] and 

b. Based on sound science and meet generally-acceptable scientific procedures 

for data quality and manipulation; 

3. The data generated by a monitoring system shall meet minimum legal 

requirements for admissibility in a judicial proceeding to enforce the PAL permit; 

4. The PAL monitoring system shall employ one (1) or more of the four (4) 
general monitoring approaches meeting the minimum requirements set forth in 

paragraph (b) of this subsection; 

5. The cabinet may approve an alternative monitoring approach that meets the 

requirements of subparagraphs 1 to 3 of this paragraph; and 

6. Failure to use a monitoring system that meets the requirements of this sedin 

shall render the PAL invalid. 

(b) Minimum performance requirements for approved monitoring approaches. If 

conducted in accordance with the minimum requirements in paragraphs (c) to (i) of this 

subsection, the following shall be acceptable monitoring approaches: 

I. Mass balance calculations for activities using coatings or solvents; 

2. CEMS; 

3. CPMS or PEMS; and 

4. Emissions factors. 

(c) Mass balance calculations. An owner or operator using mass balance 

calculations to monitor PAL pollutant emissions from activities using coatings or 

solvents shafl: 

1. Provide a demonstrated means of validating the published content of the PAL 

pollutant [W] contained in or created by all materials used in or at the emissions 

unit: 

2. If it cannot be accounted for in the process, assume that the emissbns unit 

emits all of the PAL pollutant [tbMs] contained in or created by any raw material or fuel 

used in or at the emissions unit; and 

3. ff the vendor of the material or fuel from which the pollutant originates 
publishes a range, use the highest value of the published range of pollutant content to 

calculate the PAL pollutant emissions, unless the cabinet determines there is sitespecific data or a site-specific monitoring program to support another pollutant content 

within the range. 

(d) CEMS. An owner or operator using CEMS to monitor PAL pollutant emissions 

shall meet the following requirements: 

1. CEMS shall comply with applicable Performance Specifications found in 40 

C.F.R. Part 60, A~oendix A; [Appw&&] and 

2. CEMS shall sample, analyze, and record data at least every fifteen (1 5) 

minutes while the emissions unit is operating. 

(e) CPMS or PEMS. An owner or operator using CPMS or PEMS to monitor PAL 

pollutant emissions shall meet the following requirements: 

I. The CPMS or the PEWIS shall be based on current sitespecific data 

demonstrating a cornlation between the monitored parameter and the PAL pollutant 

emissions across the range of operation of the emissions unit; and 

2. While the unit is operating, each CPMS or PEMS shall sample, analyze, and 

record data at least every fifteen (15) minutes, or at another less frequent interval 

approved by the cabinet. 

(9 Emissions factors. An owner or operator using emissions factors to monitor 

PAL pollutant emissions shall meet the following requirements: 

1. All emissions factors shall be adjusted, if appropriate, to account for the 

degree of uncertainty or limitations in the fadorss development; 

2. The emissions unit shall operate within the designated range of use for the 
emissions factor, if applicable; and 

3. If technically practicable, the owner or operator of a significant emissions unit 

that relies on an emissions factor to calculate PAL pollutant emissions shall conduct 

validation testing to determine a site-specific emissions factor within six (6) months of 

PAL permit issuance, unless the cabinet determines that testing is not required. 

(g) A source owner or operator shall record and report maximum potential 

emissions without considering enforceable emissions limitations or operational 

restrictions for an emissions unit during any period of time there is no monitoring data, 

unless another method for determining emissions during the periods is specified 

in the PAL permit. 

(h) If an owner or operator of an emissions unit cannot demonstrate a correlation 

between the monitored parameters and the PAL pollutant emissions rate at all operating 

points of the emissions unit, as an alternative to the requirements in paragraphs (c) to 

(g) of this subsection, in coniunction with [- permit issuance the cabinet 

shall: 

1. Establish default values for determining compliance with the PAL based on the 

highest potential emissions reasonabv estimated at operating points if a correlation 

cannot be demonstrated; or 

2. If there is not a codation between monitored parameters and the PAL 

pollutant emisdons, determine that operation of the emissions unit during operaping 

conditiins is a violation of the PAL. 

(i) Revalidatin. All data used to establish the PAL pollutant shall be revalidated 

through performance testing or other scientifiilly-valid means approved by the cabinet. 

61 
Validation testing shall occur at least once every five (5) years after issuance of the 

PAL. 

(1 2) Recordkeeping requirements. 

(a) The PAL permit shall require an owner or operator to retain a copy of all 

records necessary to determine compliance with any requirement of this section and of 

the PAL, induding a determination of each emissions unit's twelve (12) month rolling 

total emissions for five (5) years from the date of the determination. 

(b) The PAL permit shall require an owner or operator to retain a copy of the 

following records for the duration of the PAL effective period plus five (5) years: 

4. A copy of the PAL permit application and any applications for revisions to the 

PAL; and 

2. Each annual certification of compliance pursuant to file V and the data used 

to certify the compliance. 

(1 3) Reporling and notification requirements. The owner or operator shall submit 

semi-annual monitoring reports and prompt deviation reports to the cabinet in 

accordance with 401 KAR Chapter 52 that meet the following requirements: 

(a) Semiannual report. The semiannual report shall be submitted to the cabinet 

within thirty (30) days of the end of each reporting period and shall contain: 

1. The identification of owner and operator and the pertnit number; 

2. Total annual emissions, in tpy, based on a twelve (12) month rolling total for 

each month in the reporting period recorded pursuant to subsection (12)(a) of this 

section; 

3. All data used in calculating the monthly and annual PAL pollutant emissions, 
including any quality assurance or quality control data; 

4. A iist of any emissions units modified or added to the major stationary source 

during the preceding six (6) month period; 

5. The number, duratiin, and cause of any deviations or monitoring matfunctions, 

other than the time associated with zero and span calibration checks, and any 

corrective adion following a deviation; 

6. A notificatiin of permanent or temporary shutdown of any monitoring system 

including: 

a. The reason for the shutdown; 

b. The anticipated date that the monitoring system shall be fully operational or 

shall be replaced with another monitoring system; 

c. If applicable, a statement that the emissions unit monitored by the monitoring 

system continued to operate without the monitoring system; and 

d. The calculation of the emissions of the pollutant or the number determined 

according to subsection (1 1 Xg) of this section that is included in the permit; and 

7. A signed statement by the responsible official, as defined by 401 KAR 51 :001, 

Section l(2101, [m] certifying the truth, accuracyI and completeness of the 

information provided in the semiannual report. 

(b) Deviation report. The major stationary source owner or operator shall submit 

reports of any deviation or exceedance of the PAL requirements, including periods 

monitoring is unavailable. 

1.. A report submitted pursuant to 40 C.F.R 70.6(@O()(iii)(B) shall satisfy this 

deviation reporting requirement; 
2. The deviation report shall be submitted within the time hits prescribed by the 

applicable program implementing 4-0 C.F.R. 70.6(a)(3)(iii)(B); 

3. The deviation report shall contain the following information: 

a. The identification of the owner, the omrator, and 1-1 the permit 

number; 

b. The PAL requirement that experienced the deviation or that was exceeded; 

c. Emissions resulting from the deviation or the exceedance; and 

d. A signed statement by the responsible official, as defined by 401 KAR 51 :001, 

Section l(2101 [€&€I&] cetiing the truth, accuracy, and completeness of the 

information provkled in the report. 

(c) Revalidation results. The owner or operator shall submit to the cabinet the 

results of any revalidation test or method within three (3) months after completion of the 

test or method. 

(1 4) Transition requirements. 

(a) After the U.S. EPA approves the Kentucky SIP revisions for the PAL 

provisions published at 67 Fed. Reg. 801 86, December 31,2002, the cabinet shall only 

issue a PAL that complies with the requirements of this section. 

(b) The cabinet may supersede a PAL that was established before Auaust 10, 

2006, I-= .-. . . -1 with a PAL that 

complies with the requirements of this administrative requlation. [se&ie%] 
Date Leonard K. Peters, Secretary 

Energy and Environment Cabinet 
PUBLIC HEARING AND PUBLIC COMMENT PERIOD: A public hearing on this 

administrative regulation shall be held on October 28, 2009, at 10:OO a.m. (local time) in 

Conference Room 201 B on the first Roor of the Division for Air Quality at 200 Fair Oaks 

Lane, Frankfort, Kentucky. Individuals interested in being heard at this hearing shall 

notify this agency five (5) workdays prior to the hearing of their intent to attend. tf no 

notification of intent to attend the hearing is received by that date, tl?e hearing may be 

canceled. 

This hearing is open to the public. Any person who wishes to be heard shall be given an 

opportunity to comment on the proposed administrative regulation. If you do not wish to 

be heard at the pubtic hearing, you may submit written comments on the proposed 

administrative regulation. Written comments shall be accepted until dose of business on 

November 2, 2009. Send written notification of intent to be heard at the public hearing 

or written comments on the proposed administrative regulation to the contact person 

listed below. 

The hearing faciiity is accessible to persons with disabilities. Requests for reasonable 

accommodations, including auxiliary aids and services necessary to participate in the 

hearing, may be made to the contact person at feast five (5) workdays prior to the 

hearing. 

CONTACT PERSON: Laura Lund, Environmental Technologist 11, Division for Air 

Quality, 1" Floor, 200 Fair Oaks Lane, Frankfort, Kentucky 40601, teiephone (502) 584- 

3999, ext. 4428, fax (502) 564-4666, and electronic mail Laura_Lund@ky.gov. 
REGULATORY IMPACT ANALYSIS AND TIERING STATEMENT 

Administrative Regulation #: 401 KAR 51:052 

Contact pewon: Laura Lund, Environmental Technologist If 

(I) Provide a brief summary of: 

(a) What this administrative regulation does: This administrative regulation 

provides for the nonattainment new source review (NSR) and applies to 

new construction or modification of major stationary sources in areas 

designated nonattainment for a specifred pollutant. 

(b) The necessity of this administrative regulation: This administrative 

regulation is necessary in order to continue to receive full delegation of 

authority for the federal NSR program in Kentucky. 

(c) How this administrative regulation conforms to the content of the 

authorizing statutes: KRS 224.10-100 authorizes the Cabinet to 

promulgate administrative regulations for the prevention, abatement, and 

control of air pollution, KRS 224.10-100(26) mandates the preservation of 

clean air resources while ensuring economic growth. This regulation 

conforms to the statutes because it is no more stringent than the federal 

mandate. 

(d) How this administrative regulation currently assists or wlll assist In 

the effective administration of the statutes: This administrative 

regulation is no more stringent than the federal mandate, codified in 40 

C.F.R. 51 .I65 

(2) If this is an amendment to an existing adminislathre regulation, provide a 

brief summary of: 

(a) How the amendment will change this existing administrative 

regulation: This amendment revises the list of exempted major stationary 

sources codified in 40 C.F.R Part 51, and the list of major sources 

codified in 40 C.F.R. Part 70, as they relate to PSD, NSR, and Title V 

applicability. The amendment removes the existing standards and 

requirements for clean units (CU) and pollution control projects (PCP) that 

have been vacated at the federal level in a D.C. Court of Appeals 

decision. This amendment indudes nitrogen oxides (NOx) as a precursor 

for ozone. 

(b) The necessity of the amendment to this administrathe regulation: 

These regulatory revisions are necessary in order to implement changes 

in the )(Y State Implementation Plan (SIP) in response to changes in the 

federal rules 

(c) How the amendment conforms to the content of the authorizing 

statutes: Kentucky's federally-appmved NSR SIP provides the permitting 

and enforcement authority delegated from the U.S. EPA to the 

Commonwealth. 
(d) How the amendment will assist in the effective administration of 

sautes: This administrative regulation amendment is modeled after the 

federal regulations. 

(3) List the type and number of individuals, businesses, organizations, or state 

and local governments Mected by this administrative regulation. The 

amendment revises the applicability of major sources by specifically excluding 

"chemical process plants" that produce ethanol through a natural fermentation 

process. In addition, sources meeting standards and requirements for CU and 

PCP, and sources emitting NOx in an area designated as nonattainment for 

ozone, are affected by this administrative regulation. 

(4) Provide an assessment of how the entities identified in question (3) will be 

impacted by either the implementation of this administrative regulation, if 

new, or by the change if it is an amendment: 

(a) Ust the actions that each of the regulated entities identifmd in 

question (3) will have to take to comply with this administrative 

regulation or amendment: Regulated entities shall continue to comply 

with this administrative regulation. This amendment affects existing or 

proposed facilities that produce ethanol through a natural fermentation 

process as it specifically excludes them, under the component term 

'chemical process plants," from having to comply with the PSDINSR 

requirements. Sources will no longer be required to meet standards and 

requirements for CU and PCP. In addition, sources emitting NOx in an 

area designated as nonattainment for ozone will be subject to permitting 

as volatile organic compounds have been. 

(b) In complying with this admlnisttative regulation or amendment, how 

much will it cost each of the entlties identified in question (3): There 

are no additional costs involved in compliance with this regulation. 

(c) As a result of compliance, what benefits will accrue to the entities 

identified in question (3): Ethanol facilities, as defined in C.F.R. 51.166 

and this administrative regulation are no longer included under the 100 

tons per year PTE limit for major source categories under the PSDNSR 

rules. As a result of not having to apply additional emission controls, 

growth of the ethanol industry will inwease. 

(5) Provide an estimate of how much It will cost the administrative body to 

implement this administrative regulation: 

(a) Initially: The Cabinet will not incur any additional costs for the 

implementation of this regulation. 

(b) On a continuing basis: There will not be any additional continuing costs 

for the implementation of this regulation. 

(6) What is the source of the funding to be used for the implementation and 

enforcement of this administrative regulatim: The Cabinet's current 

operating budget will be used for the implementation and enforcement of this 
regulation. 

(7) Provide an assessment of whether an increase in fees or fundlng will be 

necessary to implement this administrative regulation, if new, or by the 

change if it is an amendment. No increase in fees or funding is necessary to 

implement this regulation. 

(8) State whether or not this administrative regulation established any fees or 

direct& or indirectly increased any fees. This regulation does not establish, 

nor does it directly or indirectly increase any fees. 

(9) TIERING: is tiering applied? Yes. The applicability and compliance 

requirements that are tiered in this administrative regulation are modeled after 

the federal PSD and NSR rules. 
FEDERAL MANDATE ANALYSIS COMPARISON 

1. Federal statute or regulation contiiuting the federal mandate. 42 U.S.C. 7401 - 

7671q; 42 U.S.C. 7401-7626, 7407(dXI)(AXi), (ii), and (iii), 7410, provides the 

statutory mandate codified in 40 C.F.R. Part 52.21, as amended in 72 Fed. Reg. 

24077, May 1,2007, and in 72 Fed. Reg. 32528, June 13,2007. 

2. State compliance standards. The state compliance standards are found in KRS 

224.1 0-1 OO(5). 

3. Minimum or uniform standards contained in the federal mandate. The federal 

NSR mandate requires sources described in Section I of this administrativs 

regulation to demonstrate that any constructiin or modification of the source wilt not 

use a net increase in pollution; neither will the source create a delay in attainment 

of the NAAQS; and that the source will install and use control technology that 

achieves the lowest achievable emissions rate (LAER). 

The amendment to this administrative regulation excludes "chemical process plantsu 

that produce ethanol by a natural fermentation process in the revised definition of 

major stationary source. Further revisions include the removal of dean unit (CU) 

and pollution control project (PCP) requirements because they have been vacated at 

the federal level by a decision from the D.C. Court of Appeals. This amendment 

requies sources emitting NOx in an area designated as nonattainment for ozone to 

be subject to permitting as volatile organic compounds have been. 

4. Will this administrative regulation impose stricter' requirements, or additional 

or dWferent responsiMlies or requirements, than those required by the federal 

mandate? No. This regulation is modeled after federal regulations. 

5. Justification for the imposition of the stricter standard, or additional or 

dCQferent responsibilities or requirements. Stricter standards and requirements 

are not imposed. 
FISCAL NOTE ON STATE OR LOCAL GOVERNMENT 

Administrative Regulation #: 401 KAR 51:052 

Contact person: Laura Lund, Environmkntal Technologist I! 

Does this administrative regulation relate to any program, service, or 

mquimments of a state or local government (including cities, counties, fire 

departments, or school districts)? Yes. 

What units, parts or divisions of state or local government (including cities, 

counties, fire departments, or school districts) will be impacted by this 

administrative regulation? The Division for Air Quality will continue to 

implement and enforce the New Source Review (NSR) program in the 

Cornmonwealt h. 

Identify each state or federal statutg or federal regulation that requires or 

authorizes the action taken by the administrative regulation. KRS 224.10- 

100(5), 42 U.S.C. 7401-7671q. 

Estimate the effect of this administrative regulation on the expenditures 

and revenues of a state or local government agency (including cities, 

counties, fire departments, or school districts) for the first full year the 

administrative regulation is to be in efkt. 

How much revenue will this administrative regulation generate for the state 

or iocal government (Including cities;, counties, fire departments, or school 

districts) for the first year? This regulation generates no revenues. 

How much revenue will this administratsve regulation generate for the state 

or local government (including cities, counties, fire departments, or school 

districts) for subsequent years? This regulation generates no revenues. 

How much will it cost to administer this program for the first year? The 

Cabinet's existing operating budget continues as the source of funding for the 

implementation of this program. 

How much will it cost to administer this program for subsequent years? 

There will be no additional costs for administering the program in subsequent 

years. 

Note: if specifk dollar estimates cannot be determined, provide a brief 

narrative to explain the fiscal impact of the administrative regulation. 

Revenues (+I-): There is no known effect on cumnt revenues. 

Expenditures (+I.): There is no known effect on current expenditures. 

Other Explanation: There is no further explanation.