### New York State DepartmentofEnvironmental Conservation Assistant Commissioner Office ofAir Resources, Climate Change & Energy, 14tb Floor 625 Broadway, Albany, New York 12233-1010 Phone: (518) 402-8549· F'ax: (518) 402-8541 ]()e Martens 'Website: Commissioner

Ms. Judith Enck Regional Administrator United States Environmental Protection Agency Region 2 290 Broadway, 26th Floor New York, New York 10007-1866 Revision to New York State Implementation Plan for Regional Haze Dear Ms. Enck: On behalfofthe Governor ofthe State ofNew York, I am submitting for approval by the United States Environmental Protection Agency (USEPA) revisions to the New York State Implementation Plan for Regional Haze. These revisions consist oflegislation amending the Environmental Conservation Law (ECL) to require a reduction in sulfur for heating oil used inNew York State, Specifically, Bill Number S 1145C amends the ECL by adding a new section 19-0325 to require that on or after July 1, 2012. all number two heating oil sold for use in residential, commercial, or industrial heating within New York State shall not have a sulfur content greater than fifteen parts per million. Whennumbertwo heatingoil containing sulfuris burned, sulfurdioxide, a primary precursorpollutant for sulfateparticles, is released into the atmosphere. These sulfates are the main constituent ofregional hazeinthe Northeast. Additionally, exhaust particles fonned by burninghome heating oil contribute to the level offine particulates inthe air, especially those less than 2.5 microns in size (PM2.5), exacerbating allergies, triggering asthma attacks, decreasing lung function, causingheart attacks and shortening life expectancy. An analysis ofthe sulfur dioxide (SOz) reductions obtained through the use ofJow sulfur number two heating oil statewide, based on the sulfur content used inthe 2002 area source combustion inventory and a future sulfur content of0.0015 percent, shows a projected S02 emission reduction ofapproximately 54,090.3 tons, from 54,300 tons in 2002 to an estimated 209.7 tons as a result ofimplementingthis law. The chartbelow represents a comparisonbetween implementing the low sulfur legislation in 2012 and not implementing the legislation. Significant SOz reductions are obtained as a result ofthe legislationbeingimplemented.2 'SO E

.. Comparison at 2 'miSSIOns fi rom D' IStl '11ate 0'1 1 uscdfi or Heatmg

### A rea 

### Sources Sector 2002 Distillate 2012 Distillate 2002 S02 Emissions 2012 S02 Emissions (x 1000 gal) (x 1000 gal) (tons) (tons) 2002 Fuel ULSD

Sulfur Residential 1,333,500 1,334,400 35,890 35,920 142.1 Commercial 560,100 526,100 15,700 14,750 56.0

Industrial 109,400 108,500 3,660 3,630 11.6

Totals 2,003,000 1,969,000 55,250 54,300 209.7 ULSD: Ultra-low sulfur diesel (0.0015 percent sulfur). The following growth factors (2002 to 2012) were used: Residential Sector: 1.0007 Commercial Sector: 0.9394 Industrial Sector: 0.9924
The Department's Regional Haze SIP, which was submittedto the USEPA on March 15, 2010, showed a reduction in S02 emissions of68 percent from 2002 to 2018. That SIP contained a low sulfur fuel oil reduction strategy through which New York will reduce the sulfur content to specific limits by 2012, but did not include the ECL amendments, The**i~c1usion** of these new programs in New York's regional haze SIP will result in additional S02 reductions of 54,090.3 tons per year from the area source sector and assist in meeting the reasonable progress goals contained in the MarL:h 20 I 0 Regional Haze SIP. The revisions to the EeL being submitted today address those strategies as they relate to the residential, commercial/institutional, electrical or industrial burning ofnumber two fuel oil satisfying, in part, New York State's obligation under this SIP. This requirement was established through state legislation rather than rulemaking and is presently in effect without a need for rule promulgation. This SIP revision request includes the following: 1. Chapter 203 ofthe Laws ofNew York, 2010, containing new Section 19-0325. 2. Notice ofProposed Regional Haze State Implementation Plan Revisions as published in the Environmental Notice Bulletin on October 20, 2010. 3. Corrected Notice ofProposed Regional Haze State Implementation Plan Revisions as published in the Environmental Notice Bulletin on November 17, 2010. 4. Assessment ofPublic Comments received from October 20, 20I0 to December 20,2010.
.

# -- 3 In addition, the Department ofEnvironmental Conservation is proposing to revise 6 NYCRR Subpart 225-1, Fuel Composition and Use

- Sulfur Limitations, to lower current distillate and residual oil sulfur-in-fuel1imitations. Eel section 19-0325 establishes the limits for heating oil throughout the State beginning on July 1,2012. We are proposing to include these provisions and establish additional requirements for the remainder offuel oils beginning on July 1,2014. Should you have any questions regarding this submission, please do not hesitate to contact Mr. David J. Shaw, Director ofthe Department's Division ofAir Resources, at (518) 402-8452.



### 1. Jarqd Snyder Assistant Commissioner Office ofAir Resources, Climate Change and Energy Enclosures
cc: D. Shaw S. flint R. Sliwinski R. \Venter, EPA Region 2LAWS OF NEW YORK, 2010 CHAPTER 203 AN ACT to amend the environmental conservation law, in relation to requiring a reduction in sulfur for all heating oil used in the state Became a law July 15, 2010, with the approval of the Governor. Passed by a majority vote, three-fifths being present.**~l:~~1?;~(~r2.:!:,£">.?f thEoJ3ta_~**  of**Ne·'~_)~.££l~.J_.I~E!esented** in**Senatc~** a.nd Assam"**£~"~!~::Y~,_ (]:c~"".::::~~~~;?.E..3~_,~w** **~:.** Section 1. The environmental conservation law is amended by adding a new section 19-0325 to read as follows: "**'.~...... S~:~f** **UE~_!:..e..~c t;.~;~t!2._**  ..!:**eg~~~ :c~.Il.~i~E)~·:.:s** ..:.. 

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### ::L**.i::}'::~_.P:9:,J**ired fue 1. § 2. This act shall take effect immediately. The Legislature of the STATE OF NEW YORK**~~:.** Pursuant to the authority vested in us by section 70-b of the Public Officers Law, we hereby jointly certify that this slip copy of this session law was printed under our direction and, in accordance with such section, is entitled to be read into evidence. MALCOLM A. SMITH SHELDON SILVER !,>:r,esiden'c of t:he Sena.te .Speake:r::**~.!: 5;£~!')** **!~~ ~i~~L;;:** 

EXPLANATION--Matter in i.talics is new; matter in brackets [ ] is old law to be omitted.PUBLIC NOTICE NEWYORK STATE DEPARTMENT OFENVIRONMENTAL CONSERVATION "REGIONAL HAZE STATE IMPLEMENTATION PLAN REVISIONS FORLEGISLATION AMENDING THE ENVIRONMENTAL CONSERVATION LAWTO REQUIRE A REDUCTION IN SULFUR FORHEATING OIL

USED IN NEWYORK STATE AND INCLUSION OFNEWYORK CITY LOCAL LAWREQUIRING LOW SULFURHEATING OIL USED IN NEWYORK CITY"
Notice is hereby given that the NEWYORK STATE DEPARTMENT OFENVIRONMENTAL CONSERVATION (Department) plans to submit State Implementation Plan (SIP) revisions for the Regional Haze SIP. These revisions consist oflegislation amending the Environmental Conservation Law (ECL) to require a reduction in sulfur for heating oil used in New York State. The ECLwas amended by adding a new section 19-0325 to require that on or after July 1, 2012, all number two heating oil sold for use inresidential, commercial, or industrial heating withinNew York State shall not have a sulfur content greater than fifteen parts permillion. Additional revisions to the Regional Haze SIP include the requirements inNew York City Local Law 194-A, which requires that by 2012, the sulfur content ofnumber four heating oil be limitedto no more than 1,500 parts per millionby October 1, 2012; all sources (boilers for heating space and water, over 350,000 btuJhr) ofnumber four and number sixheating oil will be required to use the low sulfur number four oil; and at equipment replacement, the use ofthe equivalent (for PM and NOx emissions) ofnumber two or natural gas will be required. The Regional Haze SIP which was submitted to the United States Environmental Protection Agency on March 15, 2010 contained a low sulfur fuel oil reduction strategythrough whichNew York will reduce the sulfur content to specific limits by 2012. The revisions to the ECLbeing submitted today address those strategies as they relate to the residential, commercial/institutional, electrical or industrial burning ofnumber two fuel oil satisfying, in part, New York State's obligation under this SIP. Local Law 194-A requires sulfur reductions in number four heating oil. Please note thatthese requirements were established through state and local legislation, respectively, rather than rulemaking and are presently in effect without a need for rule promulgation. The Department is providing a 30-dayperiod to comment onthe inclusion ofthese revisions inthe SIP. Written comments shouldbe submitted by5:00 PM onNovember 22,2010to Ms. Diana L. Rivenburgh, New York State Department ofEnvironmental Conservation, 625 Broadway, 2nd Floor, Albany, New York, 12233-3251 or by e-mail to:airsips@gw.dec.state.ny.us.Ms. Rivenburgh canbe reached at (518) 402-8396 with any questions regarding these SIP revisions.PUBLIC NOTICE NEWYORK STATE DEPARTMENT OF ENVIRONMENTAL CONSERVATION "REGIONAL HAZE STATE IMPLEMENTATION PLAN REVISIONS FORLEGISLATION AMENDING THE ENVIRONMENTAL CONSERVATION LAWTO REQUIRE A REDUCTION IN SULFUR FORHEATING OIL

USED IN NEWYORK STATE AND INCLUSION OF NEW YORK CITY LOCAL LAW REQUIRING LOW SULFURHEATING OIL USED INNEWYORK CITY" This replaces the previous public noticepublished on October 20, 2010 regarding these revisions and therefore, the commentperiod deadline has also been extended as notedbelow. Notice is hereby given that theNEWYORK STATE DEPARTMENT OF ENVIRONMENTAL CONSERVATION (Department) plans to submit State Implementation Plan (SIP)**r~visions** for the Regional Haze SIP. These revisions consist oflegislation amending the Environmental Conservation Law (ECL) to require a reduction in sulfur for heating oil used inNew York State. TheECL was amended by adding a new section 19-0325 to require that on or after July 1,2012, all number two heating oil sold for use inresidential, commercial, or industrial heating withinNew York State shall not have a sulfur content greater than fifteen parts permillion. Additional revisions to the Regional Haze SIP include the requirements inNew YorkCity Local Law 194-A, which requires that the sulfur content ofnumber four heating oil be limited to no more than 0.15 percentbyOctober 1, 2012. The Regional Haze SIP which was submitted to the United States Environmental Protection Agency on March 15, 2010 contained a low sulfur fuel oil reduction strategythrough whichNew Yorkwill reduce the sulfur content to specific limits by 2012. The revisions to the ECLbeing submitted today address those strategies as they relate to the residential, commercial/institutional, electrical or industrial burning ofnumbertwo fuel oil satisfying, in part, New York State's obligation under this SIP. Local Law 194-A requires sulfur reductions innumber four heating oil. Please note that these requirements were established through state and local legislation, respectively, rather than rulemaking and are presently in effect without a need for rule promulgation. The Department is providing a 30-dayperiod to comment onthe inclusion ofthese revisions inthe SIP. Written comments shouldbe submittedby5:00 PM onDecember 20,2010 to Ms. DianaL. Rivenburgh, New York State Department ofEnvironmental Conservation, 625 Broadway, 2nd Floor, Albany, New York, 12233-3251 orby e-mail to:airsips@gw.dec.state.ny.us.Ms. Rivenburgh canbereached at (518) 402-8396 with any questions regarding these SIP revisions.Assessment ofPublic Comments Proposed Revisions to the State Implementation Plans for Regional Haze Incorporating Low Sulfur Heating Oil Requirements Comments Received from October 20,2010 to December 20,2010

Economic Concerns
1. Comment: Legislation passed bythe NYS legislature to reduce the sulfur content ofhome heating oil to 15 ppm by 2012 will cause significant harm to consumers in New York by raising the price ofboth No.2 fuel oil (means No.2 fuel oil with a sulfur content of 2000 ppm or more) and diesel fuel by 15 to 25 cents per gallon. The combined effects from this rule ofdiminished supply and increasing demand will raise prices to
consumers of heating oil and diesel by about 20 cents per gallon, costing consumers in New York. The reduction from 500 ppm to 15 ppm will not bring any additional economic benefits to consumers. A 15 ppm standard will cause high quality distillate to be downgraded to much less valuable products. A 15 ppm or 50 ppm standard imposes unnecessaryburdens and costs onbusiness and consumers. (1)
Response: Thank you for your comment. On July 15,2010 Chapter 203 ofthe Laws ofNew York, 2010 was passed by the New York State Legislature and signed into law by the Governor. While the Department does not have any control over the NYS Legislature, this law will provide New York with significant emissions reductions. Stationary sources subject to the Subpart 225-1 provisions may incur increased fuel oil costs associated with this proposed regulation. There are several factors that may affect fuel oil prices. These factors include but are not limited to fuel availability, price ofcrude oil, production costs, an increase in taxes on oil, overall demand based on weather conditions, and natural gas availability and price. The Department anticipates that production costs will increase. This in tum may increase the cost to fuel oil
consumers (fuel oil consists ofeither distillate oil or residual oil) by five to nine cents per gallon from the 2009­ Page 1 of92010 oil price average. However, based on the above listed factors there mayormay not be an increase in-oil prices (there is the possibility that oil prices could decrease). There is a net benefit in health costs and maintenance costs showing that the proposed standards for distillate oil and residual oil will have a minimum net benefit in health care savings of$1.75 billion. (Public Health Benefits ofReducing Ground-level Ozone and Fine Particle Matter in the Northeast U.S., A Benefits Mapping and Analysis Program (BENMAP) Study, NESCAUM, January 15, 2008). Also, energy efficiency improvement efforts would result in future reductions in fuel oil consumption. The use oflow sulfur distillate oil by consumers for heating results in a cost benefit because the lower-sulfur oil is cleaner-burning and results in a substantial reduction in heating equipment maintenance and service requirements, while at the same time reducing S02 emissions. Additionally, the use of low sulfur distillate oil will extend furnace life and could reduce the cost ofnew oil furnaces, because ofthe ability to use lower-cost materials in their construction and more compact heat exchangers. New York is proposing to include the Chapter 203 legislation in the Regional Haze SIP to help obtain emissions reductions required under the federal Clean Air Act (Act).

2. Comment: The proposedreduction in sulfur content ofhome heating oil to 15 ppm statewide in 2012 is not clearly needed. The reduction to 15 ppm exceeds requirements ofFederal law and a cost-benefit analysis is needed for this step. Commenter does not believe the reduction to 15 ppm can be justified at this time and believes that 500 or 1000 ppm is a more supportable standard as part ofthe SIP. The proposed reduction of sulfur content in heating oil to 15 ppm is the most restrictive standard for heating oil in the entire world. The product cost of the reduction from 500 ppm to 15 ppm is estimated by EPA to be much higher than the reduction to 500 ppm for much less sulfur reduction. A product specification of500 ppm is less likely to result in price spikes because there are more additional sources ofsupply. Implementing a 15 ppm sulfur for heating oil drastically limits worldwide ofsupply, with two predictable effects, higher long term prices and much more limited abilityto obtain supplyquicklyin the case ofa cold winter. (l) Page 2 of9Response: Please see the response to Comment 1. In response to the concern that the availability of ultra-low sulfur distillate oil may be constrained at the beginning of 2012, the Department proposes to implement the ultra-low sulfur distillate oil standard for number 2 heating oil in 2012 because the legislation mandates such. Currently available refinery studies conducted for the National Oil Heat Research Alliance (NORA) American Petroleum Institute (API) and a public health benefits study conducted by the Northeast States for Coordinated Air Use Management (NESCAUM) did not anticipate a future shortage or availability problems for ultra-low sulfur distillate oil.
Timing Concerns

3. Comment: This law, by requiring refiners to supply the new fuel specification in less than 2 years, is unprecedented and unfair by not providing refiners who have continued to make an important product used by millions ofconsumers adequate time to retool to make the new fuel. No other major fuel specification change has everbeenmade in such a short period oftime and doing so will disrupt markets for diesel fuel for both road and home heating use in New York and elsewhere, partiCularly with other states such as Pennsylvania considering similar actions. Any reduction in fuel oil sulfur content should allow at least four years for refiners to add additional processing capabilities. It is our understanding that before this legislation passed, NYSDEC agreed with this position, which is consistent with positions taken by New York and other states as part ofa regional cooperative, and had intended to propose rules similar to those adopted by New Jersey. Requiring use ofULSD in New York by 2012 will eliminate suppliers for fuel oil to the State by not giving refiners time to investin additional capacity. (l)

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### Response: Please see the response to Comment 1. 

### On July 15,2010 Chapter 203 ofthe Laws ofNew York was passed by the New York State Legislature and signed into law by the Governor amending the Environmental Conservation Law by adding a new Section 19-0325, effective July 1, 2012 requiring a reduction in sulfur for heating oil used in New York State. The Department does not have the legal ability to change that legislation. This action placed the existing legislation into our SIP which will allow the Department to take credit for the emissionreductions associated with this requirement.
Unnecessary Rule

4. Comment: It 

### is our view that New York should not, as a policy matter, adopt the Fuel Sulfur Rule as part ofthe State Implementation Plan for those areas currently in attainment with PM-2.5 standards, because there is no compelling or rational basis to do so for most ofNew York State, which is in attainment with these standards and has NO Class I areas. Commenter also questions whether the data supports the need for the Fuel Sulfur Rule in the New York nonattainment area for the annual PM2.5 standard. A state implementation plan for the 24 hour standard is due in 2012, and any action should await a consolidated rulemaking, but it is not clear from the most recent data that any action is needed to attain this standard for currently designated nonattainment areas. The environmental benefits ofthis rule are overstated and do not justify its adoption at this time. Visibility cannot be used as basis to adopt a rule effective in 2012. Based on the (i) the extremely limited benefit to Class I air areas, (ii) overstated emissions inventory for fuel oils and (iii) the lack ofany legal driver to adopt a visibility standard by 2012, there is no rational or basis to adopt these rules at.this time as part ofa SIP. PM 2.5 cannot be used as basis to adopt a statewide rule effective in 2012. Indeed, areas that are themselves in attainment but are deemed to contribute significantly to non-attainment in another area are already included in the non-attainment areas subject to SIP requirements, as they are required to be under

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### Section 107 (d) of the Clean Air Act. Even for those areas that are not in attainment, NYSDEC has not demonstrated that this measure is needed for attainment ofany PM standard. (1)
Response: This action is a proposed revision to the Regional Haze SIP. Although NY has no Class I areas, the federal Regional Haze Rule in 40 CFR Section 51.308 still requires emission reduction measures to meet the federally-mandated reasonable progress goals set in the SIP. These goals were developed in concert with the MANE-VU states and apply to all ofits members. New York is proposing to include the Chapter 203 legislation in the Regional Haze SIP to help obtain emissions reductions required under the Act.

5. Comment: NOx and ozone cannot be used tojustify this rule and are irrelevant considerations because most heating oil is a wintertime fuel. In 

### some cases, proponents oflow sulfur heating oils have sought tojustify sulfur content regulation based on NOx and Ozone. It 

### is critical to note New York's use ofNo. 2 fuel oil is primarily for home heating. That means that its use is most concentrated in the months of January and February. Yet Ozone is almost entirely a summertime issue, as a result of higher temperatures causing atmospheric reactions with NOx that create ozone. These conditions are not, obviously, present in wintertime. The rule proposal also tangentially mentions nitrogen oxides as a factor in particulate matter pollution and visibility impairment. However, No.2 Fuel Oil represents a tiny fraction ofthe NOx inventory in New York. Equally important, it is quite clear that nitrate particles are not the major factor in visibility impairment. (1)
Response: Please see the response to Comment 1. We are including the provisions ofChapter 203 of· the Laws ofNew York in the SIP to obtain emissions reductions in the Regional Haze SIP. Any NOx and
ozone benefits may be used in other contexts.

Page 5 of9

### 6. Comment: There is no technology driver that requires a mandated level of 15 ppm sulfur heating oil for all boilers. High Efficiency Energy Star boilers do not require 15 ppm sulfurheating oil. There is no need for a mandate for 15 ppm or 50 ppm sulfur because this fuel is already available to consumers who want or need it. EPA's area source boiler NESHAPS rule could effectively eliminate new oil fired boilers, so that upgrades to theoreticallymore efficient technology would beirrelevant. (l) 

### Response: Please see the response to Comment 1.
Legal Concerns

7. Comment: Adding these provisions as SIP provisions works to effectively deprive the New York State**Le~slature** 

### ofits prerogative to change orreconsider this law, because once it is adopted as part ofthe SIP, it is exceptionally difficult to undo this change because ofEPA procedural requirements, even it is not needed or required at this time. For example, the legislature could, quite reasonably, decide that New York should line up behind the New Jersey timeline and revise this law to do so. But that law, once EPA approves the SIP, would have no effect until EPA approved a change to the SIP. This need to defer to the legislature is particularly important because ofthe razor thin margin by which this bill passed last year and the fact that control ofthe Senate has since changed. (1) Response: The potential for legislative changes exists for any measure, but it does not preclude the Department from including it in the SIP. If

### legislation is enacted that changes the timing or limitation in the current law, the Department will make the necessary changes to the SIP.

Page 6 of98. Comment: With regard to the reduction in fuel S content for No.4 Oil, that proposal is based on a New York City law. Ifthe Fuel Sulfur Rule is statewide for the S content ofNo. 4 oil, it cannotbe proposedjustified
as a statewide measure onthat basis. (1) Response: This SIP revision does not propose to apply the New York Cityrequirements statewide.

9. Comment: Commenter does not believe that the provisions in the Fuel Sulfur Rule for temporarily allowing higher sulfur material will be effective and do not represent good policy. The proposal allows higher sulfurmaterial to be used as follows: "2) the Governor may, by issuing an executive order, temporarily suspend the applicability of this section at any time based on the Governor's determination, after consulting with the New York Energy Research and Development Authority, that meeting the requirement of subdivision one of this section is not feasible due to lack ofadequate supply oftherequired fue1." First, it typically takes days for
a decision to be made. By the time NYSDEC and NYSERDA acts to allow the higher sulfur material into the marketplace, it is already too late and shortage situations will develop. Second, it is exceptionally rare for actual product runouts to occur such that the Governor could declare that insufficient product is available. Third, such waivers typically cause post waiver dislocations, because a supplier gets "stuck" with a tank full of material that cannot be sold in New York because it exceeds the sulfur spec of 15 ppm. (1) Response: Please see the response to Comment 1. Chapter 203 of the Laws ofNew York adopted Section 19-0325 ofthe Environmental Conservation Law include temporary suspensions ofrule applicability. The Department has the responsibility ofimplementing the law as written.

Environmental Concerns

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## ... 10. Comment: This proposal will probably raise ORO emissions in the short and medium term, not lower them, and will not materially enhance boiler and furnace efficiency, Lowering the standard below 500 ppm would have unintended negative environmental consequences. The benefits ofthis rule are offset by negative consequences, and the rule should beviewed as increasing ORO emissions. (1) 

### Response: Please see the response to Comment 1. Boilers will not degrade as rapidly using the lower sulfur fuel. Greenhouse gas emissions are not affected by sulfur in fuel. The Department believes that these provisions are necessary to protect the environment and public health. In 

### addition, the inclusion inthe Regional Raze SIP ofthe lower sulfur fuel standard in Environmental'Conservation Law Section 19-0325 will result in 

### additional S02 reductions of54,090 tons perhear from the area source sector.

Page 8 of9LIST OF COMMENTORS THAT SUBMITTED COMMENTS DURING THE COMMENT PERIOD
CommentorNo. Cornmentor 1 CHRISTOPHER S. COLMAN, HESS CORPORATION

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