Buddy Garcia, Chairman Larry R. Soward, Commissioner Bryan W. Shaw, Ph.D., Commissioner Glenn Shankle, ExecutiveDirector 

## TEXAS COMMISSION ON ENVIRONMENTAL QUALITY Protecting Texas byReducing andPreventingPollution June 13, 2008

Mr. Larry Starfie1d DeputyRegional Administrator United States Environmental

Protection Agency Region 6 1445 Ross Avenue Suite 1200 Dallas, Texas 75202
Re: Use ofPermitsByRule to Modify an ExistingNew Source Review Permit
DearMr. Starfield:


### I'mwriting inresponse to the letters from U. S. Environmental Protection Agency (EPA) Region 6 and ongoing discussions between EPA and the Texas Commission on Environmental Quality (TCEQ) staff regarding Texas' flexible permit program. This response addresses the use of Permits by**Rul~** (PBR) as an authorization mechanism to modify an existing New SouJ;'ce Review (NSR) permit. The concerns expressed bythe EPA are broader in applicability than the flexible permit program. The concerns have consequences for other parts oftheNSRpermitting programs in Texas and have the potential to affect both major NSR and minor NSR permit reviews. The issue ofPBRuse will needto beresolvedbefore the concerns which are specific to the flexible permittingprogram canbe-addressed.
The Federal Rules provide flexibility for a state to develop its own minor NSR program. The PBRs are an authorization mechanism under Texas' Minor NSRprogram. The use ofPBRs has been a long-standing authorization mechanism within the TCEQ's rules. Initially contained within Chapter 116 as "Standard Exemptions," these authorizations were later moved into their own chapter within the TCEQ's rules. They are now codified in Chapter 106 (since 1996) and are called Permits byRule.
The PBRs implement §382.05196 (and previously §382.057) ofthe Texas Clean Air Act, which provides that celiain types of facilities or changes within facilities which will not make a significant contribution ofair contaminants to the at:t;l1osphere may be exempt from obtaining a construction permit or amending an existing construction permit if certain conditions are met. Significant contribution of air contaminants is described in Subchapter A (General Requirements) ofChapter 106, which is State Implementation Program approved. The specific conditions (the actual PBRlanguage andrequirements) are in Subchapters B - X.

P.O. Box 13087 • Austin, Texas 78711-3087 " 512-239-1000 • Internet address: www.tceq.state.tx.us printed on recycled paper using .soy-bused inl;;Mr. Larry Starfield Page2 June 13,2008

New facilities or changes to facilities which make a significant contribution ofair contaminants to the atmosphere are not eligible to use PBRs. The PBRs cannot authorize a new major source, nor can a PBRbe used to authorize a majormodification ofan existing major source. Likewise, the PBRs cannot be used to authorize a new facility which is subject to case-by-case maximum available control technology**r~views** underFederal CleanAirAct §112(g).
The TCEQ, in some cases, has limited the use ofPBRs when offproperty impact concentrations and the condition ofthe surrounding area (related to the pollutant of concern), warrant such a measure. These limitations are usually placed within the special conditions of an NSR permit and usually apply to the entire plant site. 

### An example would be for benzene use in areas consideredto be "watch areas."
For TCEQ to consider changing its rules, TCEQ needs EPA to provide a detailed legal basis for excluding PBR usage at major sources, using PBRs to modify. existing NSR permits, or using PBRs to authorize limited categories of**maintenance~** startup, and shutdown emissions. Changes to TCEQ rules may require statutory changes which would need to be presented to the Texas Legislature.
The TCEQ is willing to work withthe EPA to gain an understanding ofEPA's specific concerns as they relate to and affect our air permitting program as a whole. After we have reached an understanding regarding the overall best available control technology approach, we can then beginto address concerns that are specific to the flexible permittingprogram. We appreciate the opportunity to discuss these concerns and look forward to reaching a position of clarity so that we can proceed in addressing your questions related to the flexible permit program. Sincerely,

# ~dGlenn Shankle; ExecutiveDirector Texas Commission on Environmental Quality

cc: Mr. DanEden, DeputyDirector, Office ofPermitting, Remediation and Registration Ms. Stephanie Bergeron Perdue, DeputyDirector, Office ofLegal Services Mr. John Sadlier, DeputyDirector, Office ofCompliance and Enforcement Mr. Richard A. Hyde, P. E., Director, AirPermits Division·

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