IT~D.;STATES ENVIRONMENTAL PROTECTION AGENCY 

'&pice of Air Quality Planning and Standards 

Research Triangle Park, North Carolina 2771 1 

JUL 5 1965 ,. 

\ 

'..! 

MEMORANDUIq 

SUBJECT: Revised Draft Policy on and Extensions 

FROM : Darryl D. Tyler, Director 

Control Programs 

TO : Directors, Air Division 

Regions I-X 

The attached draft policy for handling changes to sources which 

have FSD permits and extensions of these permits is a revision of the 

November 19, 1984, draft policy distributed to the Regions for con~mcnt. 

This revised policy incorporates your comments on that draft. 

There are two major revisions to the November 19, 1384, package: 

(1) the secti'on dealing with extensions for phased construction 

projects has beei? altered to provide a better explanation of the manner 

in which extensions for dependent and independent mu1 ti-phased projects 

are :ia;?dlzi ;I?(! the ratiorale for a d~stincticn between the tkm types of 

projects; and 

(2) a new section devoted exclusively to permits for steam cjsnzrators 

subject to 40 CFR Part 60 (I'ISPS) when the permit involves a r~llii~g 

30-day average emission limi t for S02. 

There have been other changes to clarify the text and respond to the 

comments we received, but those changes are relatively minor compared to 

the two revisiohs discussed above. 

In particular, if you feel that the section dealing with the rolling 

30-day avarage NSPS for S+ should be treated as a separate policy, please 

indicate this in your comments. We do not want to hold up the entire policy 

in order to resolve this recent addition. We also intend to hold a discussion 

on this topic at the Mid Pines NSR Workshop; please be prepared to take this 

opportunity to discuss your concerns. We would like to receive a1 1 your 

coinments on this latest draft by July 19. Unless substantial adverse 

comment is received, re will begin review of this package for formal EPA 

pol icy adoption. 

It should be noted that Section VII of the policy, Protection of 

Short-term Amoient Standards, includes new requirements for an agency which 

has issued PSD permi ts that do not specify short-term SO2 emissions 1 imi ts 

to adequately protect ambient air increments and standards. In such cases, 
... , 

(1) the sectfon dealing with extensions for phased cons'tructioh " - . . . . 

'projects has $2217 altered to provide a better explanation of the manner 

in which extensions for dependent and independent multi-phased projects . .- ?re haxiled and tile rationale for a distincticn between, the two types of 

projects; and . , . . I . ,. .. , .. ! 

(2) a new section devoted'exclusivelv to nermi tscfor s team ~snerators 

subject'to 40 CFR Par en the" perm; t 

30-day average emissi 02. . 

There have been other' changas to clarify the text and respond to the 

comments we received, but those changes are 'relatively' + the two rev5 si20t5s discussad above. .\ 

t' 

In partic~ilar, if you feel that the section dealing with the rolling 

30-day aq2raje NSPS for SO? should be treated as a separate policy, please 

indicate this in your comments. We do not want to hold up the entire policy 

in order to resolve this recent addition. kle also intend to hold a discussion 

on this topic at the Mid Pines NSR Workshop; please be prepared to take this 

opportunity to discuss your concerns. We would like to receive all your 

comments on this latest draft by July 19. Unless substantial adverse 

comment is received, we will begin review of this package for formal EPA 

pol icy adoption. 

It should be noted that Section VII of,the. policy, protection of 

Short-term Ambisnt Standards, includes new requirements for an agency which 

has issued PSD permits that do not specify short-term SO2 emissions limi ts . 

to adequately protect ambient air increments and standards. In such cases, 

EPA7APC013296 

2. 
the proposed policy requires the agency to revise the perrni t by adding 

liini ts which will provide such protectian. For all other cases, the policy 

presuines that the applicant is the party requesting a change. 

If you have any questions, please contact Gary NcCutcl?en, (FTS 629-5591). 

Thanks again for your assistance in developing this important pol icy, 

particularly the efforts of Roger Pfaff, Region IV. 

cc: B. Bankoff 

G. Ernison 

B. Pedersen 

E. Reich 

P. Wyckoff 
6/85 

DRAFT 

PSD Permi t Modifications: Pol icy Statement on Changes to a 

Source, a Permit Application, or an Issued Permit 

and on Extensions to Co~struction Schedules 

AGENCY: Environmental Protection Agency 

ACTION: Proposed pol icy statement 

SUMMARY: For several years both the Environmental Protection Agency (EPA) 

and various States have issued permi ts for the prevention.of significant 

deterioration (PSD) of air quality to proposed new and modified major 

stationary sources. Some of the permits require revisions to reflect 

changes in construction or operating plans, including construction schedules. 

Ir? other cases, changes in plans have been proposed by applicants prior to 

permit issuance, or after EPA has determined the source, as oriyinally 

proposed, is exempt from PSD review. No formal policy has been issued 

wh.ich addresses how such changes are to be handled. Consequently, a source 

owper proposii?g cha~?ges to a source has no guidelines to determine what 

requirements must be meet. 

Si nce no provisions are coctained in the Act for modifying PSD permi ts 

already issued, a1 1 the requirements of Part C and a repeat of the permi tting 

process appear to be necessary for changes in sources not reflected in the 

original ly issued permit in order to prevent obvious circumvention. That 

is, a new permit must be obtained if a proposed change would involve: (1) 

a major modification; (2) a difference in construction or design from what 

was originally planned, when an increase in emissions or ambient impact 

would result; (3) a fundamental a1 teration of an emissions unit or source; 

or (4) a difference in applicability, such as a source no longer being 

.exempt from PSD review. Today's policy proposes to provide a new and less 

cumbersome route by which changes can be accommodated while ensuring the 

equivalent environmental protection required under the Act. In doing so, 

i t eXtends the Alabama Power concept of - de minimis to include changes which 
are so small in terms of impacts that such changes could be excluded from 

the full rigors of permit review. 

The policy statement provides guidance for (1) re-examini ng EPA-granted 

permit exemptions, (2) revising any EPA-issued PSD permit or PSD application, 

i ccludi cg those adminis tered by States which have since obtained jurisdiction 

for PSD, and (3) the development of State and local agency permit revision 

regulations or policies. EPA eccourages States to adopt similar policy 

statements concerning source changes and the processing of State-issued 

permi ts which need revision or extension and sol ici ts comment as to whether 

such procedures should be required by 40 CFR Part 51. 

Today's pol icy staterii?rt proposes to di s tirgiiish between sources which 

have be~un operation acd those which have cot in determining the type of 

procedures used wh?r d proposed change will require permit revisions. A 

p~:-i;:it revision for a source already operaticg generally car be treated like 

any cthsr emissiors ircrezse or decrease at 8 major source ucirg est.-ulicned . . 

procedsres. For a source not yet operating, EPA proposes to group the 

racge of possible cha~yes to a PSD permit into three categories, based on 

their potential significance to the program: (1) those which can be expedited 

without detailed review (administrative changes); (2) those which can be 

processed as permi t revisions after appropriate analysis (minor and significant 

charges); and (3) those which should be treated through issua~ce of a new 

PSD permit (fundamectal changes). The required analysis for permit revisions 

typically would involve reconsideration of the basic decisions involved in 

the issuance of the original permit for the units that would be affected by 

.the proposed change. Sepaca te sections on the cri teria for extending the 

18-month commencement of cons truction dead1 ine applicable to a1 1 PSD permits 

and on handling permi t revisions resul ti ng from the use of a 30-day rolling 

average SO2 new source performance standard (NSPS) are also provided. 
DATES: This policy statement is effective as interim guidance upon 

publication. The period for ini tial commen t on the proposal closes on 

[date 30 days from the date this notice appears in the FEDERAL RESISTER]. 

A public hearing on the proposal will be held on , 1985, at 

10:OO a.m., in , Denver, Colorado 80295. 

ADDRESSES: Comments should be sent in triplicate if possible to: Central 

Docket Section (LE-131), U .S. Environmental Protection Agency, 401 M St, S.W., 

Washington, D.C. 10460. Attn: Docket No. A-83-40. 

DOCKET: EPA has established docket number A-83-40 for this action. This 

docket is an organized and complete file of all significant information 

subiiii twd to or otherwise considered by EPA. The docket is available 

for public inspection and copying between 8:00 a.m. and 4:OD p.m., 

Mocday through Friday, a t EPA's Central Docket Sectioa. A reasocable 

.- 

ice nay be charged for copying. 

,.. FgRTiiiR !NQi!IRIES: For. ?~:rther i?for!mation, contact Gary IJlcCutchea, . . 

New Source Review Sectioc (MD-15), Environmental Protection Agency, 

Research Triaagle Park, North Carolina 27711. 

SUPPLEMENTAL INFORMATION: 

I. BACKGROUND 

A policy is needed to maintain the basic integrity of the PSD permitting 

process required by the Clean Air Act when requests are received to revise, 

add to, or delete condi tioas on issued permi ts or information contained in 

a complete appl ication. A rigorous precons truction review for PSD would 

ul timately not be effective if sources could readily obtain subsequent 

.relaxations to their permi.t condi tions under a lax policy for permi t revisions. 

For example, the Act clearly intends state-of-the-art application of best 

available control technology (BACT) by PSD sources, but a lax policy for 
subsequent proposed changes could undercut the environmental protection 

offered by the original BACT determi na ti ons. 

Nhen EPA revised its PSD regulations in August 1980, the Agency deferred 

the development of guidance governing its PSD "permit modification" process, 

i .e., the procedures by which proposed changes to a source, application or 

permi t would be handled. Since then, the Regions and States have handled 

requests for such changes on a case-by-case basis. These involve a broad 

variety of redeterminations of exemptions from perini t requirements and 

permit changes, both mi nor and important, arising from sources which are 

already opera ti ng as well as those on which cons truction has not yet commenced. 

TWis lhas catiiral ly l?d to a variety of d?cisiors across the country and, 

hence, creates confusion and i refficiency in the permi tticg process for 

iFA, irdustry, ard the States. A natiorwide policy is recessary to assist 

211 parties ir deal-irg with PSD source changes acd the need for PSD permit 

.:. . . ... rev:s<o?s in.2 cai.sistent ma?%r. !c addition, scch a policy \./ill .serve to- , . 

establish a firm policy framework which resolves questions of legal risk 

wher a judgment is made that new permits are not required. 

Current policy requires that a new permit be obtained if a proposed 

change consti tutes: (1) a major ~nodification; (2) a difference in construction 

or design from what was originally planned, when an increase in emissions or 

ambient impact would resul t; (3) a fundamental a1 teration of an emissions uni t 

or source; or (4) a difference in applicability, such as a source no longer 

being exempt from PSD review. Today's policy proposes to provide a new 

and,less cumbersome route by which changes can be accommodated while ensuring 

.equivalent environmental protection. In doing so, it extends tne Alabama 

- Power concept of - de minimis to include changes which are so small in terms 

of impacts that such changes could be excluded from the full rigors of 

processing. 
Due to the similarity between major and minor "source modification" 

and "permit modification," it is important to establish a terminology 

which will not be confused with existing PSD terms and which can be used 

consis tently and precisely to describe the si tuations and actions regarding 

this policy. Therefore, the term "permi t modification" will not be used. 

Instead, the following terms are used to describe this policy. 

A "change" refers to the proposed or actual a1 teration of an application, 

perini t, or source, or some combination of the three. An application for a 

proposed change initiates Agency action if the application is complete. 

When the proposed change has actually been made, the altered source, permit, 

3:- a3-- ,,plicatior is referred to as "changed" or "revised." Changes are classified 

accordicy to the effect they would have on the reviewing agency's assessment 

of ti?. sovrce. Ir orOer of ircreasing importance, changes are considered: 

. ,Adinir:is -- traI-$ve. :,r admii?istrative charge involves no increase ir 

+ .. . . ..ej.,.y;er e!n<sjicrs or jmpact; .ard -no furdai~ertal charge ic-.ei thcr the source -' . -, ., 

or one of the emission uni ts at that source. Application or permit revisions 

may be necessary, but addi tional review or analysis would not normally be 

required; examples are typographical and company name changes. One exception 

is the extension of commence construction dates, which may require a limited 

additional review consisting of BACT reanalysis and public participation. 

2. Minor. Minor changes require revisions to permit applications or 

issued permi ts and a certai r amount of addi ti onal review and analysis, but 

do not constitute either a fundamental or significant change. Emissions or 

impacts increase as a result of minor changes, but not above the significance 

1 eve1 . 

3. Sigcificant. Significant changes are changes where one or more 

pollutant emission increases exceed the applicable significance level(s) 

but which do not cons ti tute a fundamental change. Major modification 
review level is triggered unless the affected source is not yet operating; 

significant char.ges at preoperating sources are considered application or 

permit revisions. 

4. ~"ndamental. A fundamental change is so basic in nature (size or 

type of source or emissions unit), regardless of the net emissions or impact 

differences, that the changed source or emissions unit is considered a new 

source or emissior.8 unit and thus triggers a totally new permit review. A 

fundamental change could even resul t in an emissions decrease but still 

require the owner or operator to obtain a new permi t. Examples include 

proposing a kiln in place of a dryer and proposing a 500 TPY unit in place 

of a :Ci3 TPY uri t. 

The effect of a chapye depecds in part on the status of a project. 

Project status rnilss topes are: 

I. ixein;?ted i-om PS3 review 

,. . . . . . * . 2. . Pc.e~-i?rs irvctioc ?SD :err:; t appl -ica.tion Sl~bmi tted .., " .. , .. 

3. Precons tructiot: PSD permi t issued, but source is not operational 

(also, the appl icabi ii ty of new PSD rules is affected by whether cons tructior. 

of the source has commenced) 

4. Precor.struction PSD permit issued and source in operation 

The results of various combinations of changes and source status are 

suminarized in Table 1. A procedure for determini ng which resul t is applicable 

to a specific source is diagramed in Figure 1. Note that both Table 1 and 

Figure 1 car. only su~nmarize this policy; more detailed informatior. appears 

in the text. 

11. AGENCY JURISDICTION a 

Today's policy covers all PSD applicability decisior.~ and all PSD 

permits original ly issued by EPA. This includes those PSD applicability 

decisions and permits which are still under Agency jurisdiction, as well 
as the applicability decisions and permits issued by EPA which subsequently 

come under State jurisdictior? as a part of PSD program delegation or SIP 

approval. 

The Agency intends that today's guidance also be used as a model for 

States developing their own permit revision processes for PSD, nonattainmen t 

area (Part D of the Clear! Air Act) and other new source review purposes. 

EPA be1 ieves that regula ti on$ governing proposed changes to sources, permi ts 

or applications are needed as a legal a1 ternative to having to issue a new 

permi t for a1 1 except certain administrative changes. €PA solicits comment 

or the need for separate 40 CFR Part 51 regulations requiring State adoption 

of a siinildr policy to ersure the credibility of State PSD programs, as well 

as ti!? reed to extend this policy to include nonattainment area inajor sources 

ar:d major. modificatio~s. As a inin'imum, EPA believes that state-of-the-art 

3,s t ach;eva>.le cortro! t$chcoiogy (SACT) should be guaranteed by ary State 

reecsi!!? t<or ~i PSC ap;:i.icatiors and permi ts. . , .. ,.. 

IiI. CLASSIFICATION AND REVIEW OF CHANGES 

There are two primary factors to consider in determininy the scope of 

review to be imposed upon a source in response to a proposed change. The 

first of these invol ves the significance of the proposed change; the rnore 

significant the change, the more involved the review will be. Four levels 

of change have been identified (administrative, minor, significant, and 

f~indaniental) , leading to the same number of (but not always corresponding) 

levels of review stringency: amendment, revision, major modifica tion and 

new permi t. A second factor, stage of source development (whether the 

source has been issued a permit, whether the source is operating and, in 

cer tain cases, whether cors truc tion has commenced) , is cri tical i n determining 

what action is required and whether any of the original increment allocation 

(for.particulate matter and sulfur dioxide) is preserved. For reasons 
explained below, various changes by a source that is not yet operating can 

reasonably be treated in a more stringert manner than would the same activity 

by a source already in operation. 

(A) stage of Source Development 

EPA proposes to classify some PSD-related source changes differently 

depending on whether the change is for a source that has already begun 

the operation authorized in its PSD permit. This difference in treatment 

between sources not yet operating and those already doing so is based on 

several factors: (1) a project in its earlier phases is much more flexible 

than one already operating; (2) the company's commi tment to the project 

prior to operation is less clear and its position regarding further changes 

ar a piact which is not yet ir operation differs frcm that of most existing 

soaris: ard (3) ti?? test of i+ihi.ti?er a Source can operate and produce a 

.?rcr?!,~ct b.irder the or$g'ral cors tructior pla?s ?l ;m;nates a great mary 

.. . . -. ..:. . , . pi>ji~:.li ii.e.8. of. obvious r.3:-cu:r.verticn of the regviatioi!s. Treat'ng ar. . . 

operating source as esse~tially having completed the permitting process 

elimi nates the burden of uncertainty on the company of cons tantly having to 

evaluate proposed projects in light of changes made years ago. Today's 

policy acknowledges these factors by typically imposing a less rigorous 

process for proposed chacges at operating PSD sources. EPA solicits comment 

or the reasor!ableness of this approach and on whether other events such as 

co:nmence!nect or completior of cons tructior should have some greater s tacding 

ir. a final policy. it should be noted that commencement of construction 

already confers an exempt ("grandfather") status to a source not only ir! 

-CFR Parts 51, 52, and 60, 9ut also in this proposed policy when determining 

whether newly-issued rules are applicable (see below). 

1. Pre-operational Sources. An application for a change to an 

application or permit for a source not yet in operation would general ly 
prompt reanalysis of the proposed project as if the original application 

had been submitted ir that form. However, some changes would be corsidered 

sufficiently unimportant that they could be treated as application or permit 

amerdments; these are termed admiris trative changes. Other changes would 

be important enough to prompt the need for a revised or new application 

or permit, and could require additional review actions. These various 

levels of change are discussed in detail in the next section. 

For appl ica tion and permi t changes requested prior to operation, EPA 

is proposing that the changes be handled as part of the initially permitted 

project, rather than as new projects. Th@ Agercy is concerned that changes 

t'idt are irdjviduai ly smal I would be accumulated such that a cumulative 

sigrificart change would rot be given the full review that such a charge 

siiould receive. Thus, ever a - de m$nimis increase ir a poi1utar.t cdr be 

s:;'iJect tii PS3 r?v;ew .if t?at poilu tact siouid be significart wher' added to 

. .. . ... :prev:i.ous irc.reases. (Th:is. .i,s.further explair!eii, below tunr!er (;j)2. Revisiocs..) . .. .- , . 

In order for EPA to treat such a change as a new project, and not as part 

of the already permitted project, the applicant would be required to inake a 

demonstration that the two projects are physically independent and were 

considered to be separate projects for planning purposes. If the reviewing 

agency concurs that the new project is a separate project, the change can 

thec be treated as such. These criteria are identical to those used for 

judging separa tioa of projects a1 ready constructed (see below). The only 

difference is that EPA initially presumes that a change at the site of a 

noroperating source is not a rew project. 

2. PSD Sources Alreacy in Operation. Applications for changes 

which would affect sources which have already been issued PSD permits and 

been placed in opera tion have generally been treated the same as applications 

to charge any existing major stationary source. That is, if the cha~ge is 

EPWAPCO 1 3306 
significant, it cons ti tutes a major inodification, as defined at 40 CFR 

Part 52.21, and a complete PSD review is required; if the change is not 

significant, it does not constitute a major modification and no PSD review 

applies. Under today's policy, changes will instead be processed in the 

manner described i n the next section. 

The only exception to the approach described below arises frorn the 

need to avoid circumvention of the regulations: if the proposed change 

snould reasonably have beer! part of the ini tial project rather than a 

separate project, it should be evaluated as part of a new total source 

impact rather than as a separate action. At times, such proposed changes 

take the form cf "separate" sources or even projects involving more than 

one source. However, if the reviewing agency judyes that such sources or 

p'ojects are part of the I prgject covered in a previous PSD application, 

ti-,? ::har$es ihoilld ibe treated {derticaily to ciiarges for sources rwh'ci? have 

. . -. e: ~&~,~,p. gp~.:.sii or.. 1,hi.s I??!!& t be deter;nined $y the .rev?;i.+.i?g .a<;efi~y . .... , . :.. 

or a case-by-case basis, tauing into accouct wheth2r the proposal represents 

charges at the source which are physically independent of the origina! 

project, and whether the appl ican t can provide documentation to show that 

planning of the second project occurred after the planning for the first 

project. Thus, if a PSD-permi tted boiler has been constructed, and the 

owner then applies for a -- de minimis increase in SO2 emissions from the 

boiler, wiiich in the judgment of the review agency should have been a part 

of the original permi t appl ica ti on, the requested change cannot be treated 

as a new application (and therefore be exempt' from review because it is - de 

.minimis). It will instead,be subject to each PSD review element within the 

permit revision process as described below. Conversely, if the applicant 

applies for a new processing unit to be used in a completely separate 
production area of a chemical plant, this application can be treated as a 

new project and exempted from review, if - de minimis. 

(B) Levels of Review 

1. Amendment. Changes to a permit or application are classified as 

amendments if they are administrative in nature and result in no increase 

ir either the emissions or the air quality impact of a PSD source. In 

addi tion, nei ther the nature nor the size of the source or emissions uni t 

car. be altered to the extent that the change would be considered fundamental. 

Amendments may be quickly processed wi thout any major reevaluation of the 

decisions original ly made in permitting the source. Examples of the type 

of cnacye which would often be treated as an aiilerdment include coinpany came 

or operator chanyes, requiren1er.t~ for more frequent monitoring or reporting 

5y the perini ttee, correc tior of typographical errors, emissioc decreases 

a1 ttioi!gn such decreases , to be used ir retticg or tradirg, must 2e carefull,y 

..,.. , -dnc:i!ner.teri) an.! mi-or b;a?d+rg c:l.arificat.iofis. It shouid be coteci that8 ... . . . . . , . . . . 

fundamental change (see below) may also result in no increase in emissions 

or impact, but cannot be treated as an amendment. 

The lack of emissions and impact increases for an amendment results in 

little or no review. Proposed amendments (which are nearly always administrative 

changes) to applications and permits do not require any reanalysis of the 

basic review originally submitted and need not be subject to piiblic participation 

requirements as a gereral rule. However, the Agency emphasizes that there 

may be instances where changes which are normally administrative may be 

sufficiently impor tact that the reviewing authority determines that review 

.or public participation is. necessary, e.g., a change of ownership of a 

proposed source to a company which has been involved in highly controversial 

projects or has received public attention as a result of the manner in which' 

other air pollution sources owned by this company were operated. 
One administrative change which always receives some level of review 

is the extension of commence cons truction dates. Such changes cons ti tu te 

amendinents but mu8 t be reviewed to ensure state-of-the-art BACT; in addi tion, 

it is usuai ly appropriate to seek public comment on the proposed extension, 

since other potential new sources may be affected. A more detailed discussion 

of this type 'of change appears in Section VI below. 

2. Revision. The term revision encompasses the review level required 

for the large majority of minor and significant changes at all preoperational 

sources and at existing (operating) major stationary sources which do not 

qualify as "major modifications," as dafined by the PSD regulations, or as 

fardaine:?ial changes. iievisio~s icclude, in the case of operating sources, 

:nos t charges involving cops tructior! or chacges in the inethod of operation 

of a source, cd co::irol equipmect, that do -- not produce a cet s'igrificart 

.,;Ti- ...,,, s~ors . itccrease; 2 r? ts igrifica-t eaissiors ircrease resul tirg froin a 

;i::ys,icai .c!?zryecr ::Rar?e i fi. themethod of operation. at a? opera ti!:y source . -.. . , . 

usually corstitutes a major modification as defined in the rules and is 

processed as such. It should be noted that there is a distinction between 

(a) modifications (as defined in the PSD rules) which are not subject to 

NSR, and (b) changes (whether requested or necessary) to a permit or permit 

application. A change which does not resul t in a significant net increase 

ir emissions is cot considered a "major modification" and is not subject to 

PSD; liowever, the chanye (nay require (or the owner may request) a revision 

of the source permit (or application). In such cases, the reviewing agency 

may consider some level of reanalysis and review necessary before revising 

the permit or accepting ar. application revision. For example, a source may 

want to change a solvent used in one of its processes, with no increase in 

emissions, but the permi t specifies the solvent to be used. Before revising' 

the permit to allow use of the new solvent, the reviewing agency may decide 
to repeat public comment if the new solvent is more odorous or toxic than 

the current sol vent, repeat the impact analysis if the new sol vent is more 

reactive or toxic than the current sol vent, or revise some other component 

of the exi; ti ng analysis. 

Despite the possibility of a revised analysis, nonsignificant emission 

increases do not constitute the type and degree of review-to which major 

modifications are subject. In many cases, it is anticipated that little or 

no revised analyses will be required of nonsignificant emissions increases. 

On the other hand, changes to permit (or application) parameters which the 

review agency considered important enough to include on the permi t (or rely 

u?on in the appl icdtion) should certaicly be subject to review before those 

parameters are revised. 

~. Ths term ri.v:s!or also ercompasses tne level of review of iiios t cacdidate 

a:;?.lcat!oc ard pzrmi t ciiti~ges wilich are praposed at sources v4n;ch are 

?catoc wi t:!:res;)ec>:to. cons-triicti,ofi,approved ic their PS!? permi.t, . .. 

The ocly exceptiocs are those changes which are administrative, or which 

are so great that they require a totally new PSD review (fundamental changes). 

Once a change is classified as requiring the revision level of review, 

< t is screened to determine which elements of PSD review now apply and to 

what extent. A revision will first require a screening analysis to determine 

whethsr exis tiny analyses addressing the PSD requirements are s ti 11 accurate 

o: whether there is a ceed for revised analyses. Iqajor components of the 

cew source review irclude BACT, ambient impact analysis, monitoring requirements, 

addi tional impacts analysis, Class I area protection, and public participation. 

-A full description and explanation of these review components is contained 

in the August 7, 1980 FEDERAL REGISTER (45 FR 52676). Depending upon what 

change is proposed, this screening may be very simple, as in the case of a 

very.smal1 increase in the size of an emissions unit, or very involved, as 
in the case of the addi tion or replacement of a new uni t at a preoperational 

source. 

The proposed change must be examined not only to see if any existing 

analyses should be revised, but also to see if any new analyses should be 

performed. The criteria for requiring additional review elements will be 

whether the original new source or major modification appl ication underwent 

all of the review which would have applied had the application been submitted 

in its revised form original ly. In addi tion, any new requirements added to 

the PSD regulations since the time that the original permit was issued also 

could apply, unless construction had commenced so as to qualify for an 

exernpt'or (as djscussed below). If there is ro circuiiivertion of the permit 

requireiaerts, the r-evisior rev?e\v wouid focus on only that portion of the 

sc,j:.si. im!riediate!y i?v~lv?.d i n the proposed change, rather than all of 

tL?j? i s i)?ev.io:i~ly r;)~; .?~*ied. 

. i-!:? e):aii;?iii. .is a pro,oos?c! c4?3?ge ;prior to permi t issuance to. add il !!nit . .. , ,.. , 

emi tti?g 15 tons per year of S32 to ar application for a source which 

originally provided for 100 tons per year of particulate matter and 35 tons 

per year of SO2. This would constitute a minor change. Since the change 

is combined with the original application, both the new uni t and the already 

permitted units must undergo each PSD review element for S02. This is 

because the original permitted level of SO7 - was - de minimis, thereby exempting 

SO2 froin rev';ew, but the total new level of SO2 is significant (35 TPY and 

15 TPY together exceed the 40 TPY threshold). However, the original application 

date is used in a1 locating increment for the original 35 TPY SO2 emissions 

.l eve1 unless circumventior. of the SO2 review had been in tended. 

As another exainple, suppose a permit for a new PSD source allows 

60 tons per year of SO2 emissions and the source was not required to gather 

precons truc tion moni toring data because i t created a - de minimis ambient 
impact. The source owner wishes to lower the stack which emits S02, making 

total SO2 impact significant. The source owner would therefore be required 

to conduct a new modeling analysis and gather representative preconstruction 

moni toring data before the cnange could be approved. 

In processing a revision, whether for a minor change or a significant 

change, the reviewing authority must follow the same public participatior! 

procedures noted in 40 CFR 52.21(q) for the processing of preconstruction 

PS3 permits. EPA believes that the reconsideration of the conditions and 

review of an exis tiny permi t undergoing revision should receive no less 

an opportuni ty for public involvement than did the original permit application. 

This ir?cludes pub1 ic notification by newspaper advertisement in the area 

of the source. The notice would contain inforination regarding the agency's 

prel irni nary deterni ria tior, tile expected ambient impact of the proposed 

chdrg?, the 3C-day oiip9rturi ty for r!ri tten cornrnect, 21:d an opporturi ty 

for a ;ub!ic tear.ing.. . . . . . 

A proposed change qualifying as a revision, rather than as a new 

permi t, receives certair. befief i ts. As mentioned previously, a revision 

can be exempted from any new PSD requirements that were added between the 

time of the original permit issuance and the submission of the proposed 

change if the source had commenced construction prior to the adoption of 

the new PSD requirement. "Comnience construction" is defined in terms of 

tile owner or operator having dl1 the necessary preconstruction approvals 

or permi ts and ei ther having (1) begun, or caused to begin, a continuous 

program of actual on-si te construction of the source, to be completed 

.wi thin a reasonable time, pr (2) entered into binding agreements or 

contractual ob'l igations, which cannot be cancel led or modified without 

substantial loss to the owner or operator, to undertake a program of 

actual construction of the source to be comaleted withir! a reasonable 
time. The purpose of subjecting revisions to new requirements for sources 

not havicg commenced construction is to remove the potential benefit a 

source might obtain by submi tting a questionable appl ication to reserve 

increment or avoid new PSD provisions. 

Another major advantage a source gains by qualifying for a revision, 

rather than having to obtain a new permi t, is that the source retains the 

ircrement rights afforded by the original application or permit. Neither 

cew permits nor fundamental changes to an original proposal (which by 

definition change the very character or nature of a source) preserve the 

original increment a1 locatioc, because that a1 location was for a specific 

type and size of source at a specific location. An allocation is not autoriiaticaliy corferred to, for example, a cement plant which is proposed in 

.. ..,, t,c:.h~ :.3cs::r.1e.d. i;?:yr]::i: t$,at wig; cal ly a1 located, toay '5 :pol4.cy .i!o:i!d a1 1 o!~ . 

tne adai tional :rcreniect consump tior: only when increment is available after 

prior complete appiicatiors have been processed acd only at the concurreme 

of the State in which the source would locate or is located. If new increment 

corsumption beyond the signi ficance amounts iden tif ied in the 1978 preamble 

(excluding Class I areas where any new impacts must be authorized by the 

Federal Land Manager) would result at any point, such increment consumption 

m!;s t also be authorized by the State in which the source would locate or is 

located. 

An especially significant issue arises from situations in which there 

.is competi tion for the available air resource: other permit applications 

ard changes are pending such that the ambient cei ling imposed by the 

NAAQS or increment would prevent the granting of all of the applications. 

In such circums tances, EPA would take a first cornelfirs t served approach 
to allocating the growth rights, subject to State approval. This means 

that the original emissions growth rights would be preserved but that the 

reinaining growth rights would be awarded to intervening appl icants filing 

applications prior to the filing of the proposed change. When EPA is 

implementing this policy, it will recognize the rights of complete PSD 

appl ications filed with States which have the responsibility under their 

own PSD program for future permit applicants. Any State taking jurisdiction 

of EPA-issued permi ts may develop a1 ternatives to first come/f irs t served 

allocation of air resources to which EPA would generally defer; of course, 

no such a1 ternative system can allow an increment violation to resuit. 

3. Major Modification. Operating uni ts which propose changes that 

consti tute a "major modification," wi thin the meaning of the NSR regulations 

are subject to those requirements. Generally, this review is equivalent to 

the requiremerts for a Pew source (see below), but the review is conducted 

orly for the nodificatioc, :ot for the ertire existing source. The term 

"major modification" is deficed as "any physical change in or change in the 

method of operation ... that would result in a net significant emissions 

increase.. . ." Physical changes are, in general, readily identifiable, but 

changes in the method of operation are often more subtle. The latter 

includes such activi ties as removal or significant a1 teration of pollution 

control equipment. For a source not yet operating, however, proposals which 

would normally be considered major modifications would generally under this 

policy be treated as an application or permit revision (see above). 

4. New Permit. Some changes are sufficiently important such that a 

separate new application or permit is required, rather than a revision to 

the existing application or permit. These are of two types. First, a 

change to an application or a permitted source which affects the fundamental 

nature of the source triggers the need for a new permit. A general guide 
to whether the fbndamental nature of a source is being changed is whether 

the proposed changes would result in either a different 2-digit SIC Code for 

the source or a large increase in size. However, the reviewing authority 

must use good judgment and make this decision on a case-by-case basis. 

A new application or permit is required for fundamental changes 

because the proposed change would be of such major importance to source 

operation that the basic permitting process should be repeated, with no 

.iccreinent rights reserved. For example, a chacge from a dryer to a kiln 

rnay affect a review such that different emissions control or product 

recovery operatiocs would be found to be feasible for the kiln where they 

were rot for tne dryer ucder the original acalysis. 

Since it is of ten inappropr.iate to apply SIC codes to portions of 

sources, this procedure carrot easily be used ~i?ec the iproposed action 

. . W1Ji6 afFect ocly 2 part uF ar existiry sourcc. The rev;ewicy authority 

F . rr J , d ~liereforc ciecide 3:: d case-by-case basis whether the fi:nddmenc.al 

cature of the permitted portioc of the source is being changed. SIC 

codes could be used as a guide to do this. For example, if a new boiler 

is placned or permitted at a kraft pulp mi1 1, acd the applicant wishes to 

construct a lime kiln ics tead of a boiler, it is clear that the fundamental 

nature of the uni t (the boiler) is being changed, even though the source 

(the kraft pulp inill) is cot; the lime kiln would require a new permit. 

Fundamental changes ic the size of a permitted emissions uni t or source 

are those changes which iccrease the fixed capital cost of the emissions 

unit or source by greater than 50 percent. This could often require more 

than a 50 percent increase in source or emissions unit size, since cost per 

production uni t usually decreases as the size of the uni t increases. 

A decision to review a change as a new permit application would 

generally entail the same data development as would the original permit 
application, although the review would focus on the proposed changes. In 

many instances, data from the original permit application could be used 

to expedite the new pernii t review process. Additional data would of ten 

be required for the new or changed units and all units affected by them. 

If the new or changed units affect the original BACT, air quality, and 

model ing analyses, these analyses would need to be revised accordingly. 

As ~oted above, one area where the processing of certain significant 

ard all fundamental changes may differ greatly from that of many significant 

acd all minor chanyes concerns the awarding of new increment rights: sources 

or emissions units involved in application and permit revisions (which assumes 

ro fundanental change) retair! their origical increme~t riyhts during the 

revision process. Ir! cortrast, a change that is processed as a new permit 

:nust compete for available air resources behind acy complete aiipiications 

. , 

i; led before tile cciiip;tzte ap;?l icatior! for the chacge is filed. It is importar! t 

t- cote thdt, wh: !e the perm.; t as prev:ously issued erti ties the criginal 

project design to be built, the permit does not award equivalent ificrement 

riyhts to the source for ary substantial shift in configuration, type, or 

size of ur!i ts that it might wish to construct. 

If there has been much growth in an area or if the area is heavily 

icdus trialized, air quality may have deteriorated so as to be near the 

ceiling imposed by the incremerts or NAAQS. Ir! such a case, a new source 

permit may cot be issuahle. Consequently, either the one-year deadline for 

processing a complete appl ication wi 11 be control1 icy (EPA must disapprove 

a permit if insufficiect increment is available wi thin a one-year timetable) 

or, if the original permi t has already been issued, the 18-month deadline 

for commenciny cons tructior! (assuming no extension) wi 11 force the source 

attempting to change i ts PSD permi t to finish i ts original cons truction 

plans or to withdraw its proposed change and not cons truct at a1 1. 
Figure 1 o"t1ines the process that a reviewing agency can follow in 

classifying an application for a change. EPA also offers Table 1 in order 

to convey summarized guidance on which of the above described levels of 

review should be applied to various types of permit changes. Table 1 lists 

a wide range of ways in which a source might be changed and indicates the 

Agency's proposed conclusions on which forms of review would apply. It 

should be noted that both Figure 1 and Table 1 are presented for purposes of 

! 1 lus tration; other types of changes may occur and, in addition, special 

circums tances may arise which prompt the review authority to address a 

charge differently. The Agency solicits comments regarding other types of 

everts which sllould be ircluded on the list or on the way that the listed 

i tens are classified. 

' iIACUiviYiRTiON 

i? cieterict i?ati?r by a rs'diiew agercy thdt a proposed charge cots t'i tu tes 

circc::i:!.e"ticr resv: ts.ai!t.?:n;; Mcz! ly .in 2 require;nert that a ?el4 sfrn:i 2 . . . . 

applicatior: be filed. Tne app1.icar.t would be urable to preserve a!?y of the 

ircrement a1 located to the original permi t. A1 though circumvention has been 

discussed in more detail elsewhere, the concept of circumvention within the 

framework of changes to a source presects additional complexitief;. 

An example of circumvention would be the proposed addition of a 15-tonsper-year SO2 enlissions uri t to a permit for a source originally proposed to 

en.; t 150 TPY particulate %a tter ard 35 TPY S02. The reviewirg agency then 

d;scovers that a 50 TPY SO2 unit had been planned for that source from the 

beginning, but that the applicant had attempted to avoid SO2 PSD review 

(including BACT) by applyicg in two stages. In such a case, the original 

permit is valid only for the source exactly as specified. If the applicant 

wants to change the source, a new permit application must be filed. None of 

the original increment allocation is preserved; the "complete application" 
date for the source would be the date the proposed change application was 

considered complete. This policy is intended to discourage the submission of 

deliberately incomplete or misleading applications through loss of any increment 

a1 location that resulted from such actions. However, EPA would still intend, 

even in cases of circumvention, that any portior! of the original application 

and review which are still applicable be retained, and that subsequent 

actions concentrate on the changes to the source that resul t in a need for 

addi tional revjew. 

V. INCREMENT ALLOCATION AND PRESERVATION 

Currently, EPA a1 locates increment on a firs t-come, firs t-served basis, 

using the date a coiriplete application was subrni tted to determine an applicant's 

place in lire. The allocated ircrement is assigned to the specific source 

(or emiss::or:s u::i t) arid locatioc described ir tile pernii t and ap(11 ication; 

; . + car~ot be used Sy the apijl?cart for another source, even if the second 

,.. . . . . S~!.J?CF .is 121 aroed 2t the s..?-ie locatioo, nor.can i t te vs?d ~CC the same. type . . , . 

of source at a different location. 

For example, assume a permi t has been issued for a cement plaot at 

Location A, wi th an anticipated Class I1 (plant boundary) 24-hour total 

suspended particulate (TSP) impact of 40 micrograms per cubic ~neter (ug/m3) 

and a nearby Class I 24-hour TSP impact of 2 ug/m3. The increments reserved 

for the cement plart are the 2 and 41) ug/m3 Class I and I1 impacts. If the 

oviner decfdes irstead to constract an asphalt plant at Location A, the 

ircrements assigned to the cement plant are not "preserved" for use by the 

asphalt plant. The owner must submit a new application for the asphalt 

pl ant, receive a new date of submi ttal of a complete appl ication, and try 

again for an increment allocatiol?. (In fact, without today's policy even 

minor changes to the cement plant could result in loss of the allotted 
increment, since the increment use is assigned to the source ar!d location 

exactly as specified in the permit and applica tion.) 

Similarly, if the cemect plafit owner decides that location B would be 

a better place to construct than locatior! A, the increment allocated to the 

cement plant at location A is not preserved for use at location B. The 

owner inust submit a new application for location B and this new date of 

subini ttal of a complete application is used to establish the firs t-come, 

firs t-served -incremert allocatior!. 

In addi tion, current policy does not provide any increment allocation 

for proposed sources which at first are exempt from PSD revjew but become 

subject to PSD review at a later date due to a proposed char!ye. For example, 

assume a 1 is ted Source A (major at 100 TPY) is es tiinated to eini t 85 TPY of 

SO2. Tne owcsr submi ts ar iippl ica ti3c to th? reviewii?~ ageccy, is toid 

tlia t tile source is exemgt from PSD review, acci proceeds to 0bta.i~ a; 1 the 

',"S,.. ... -4 .:. a,.,. ,, .dry, L~ i?d :il SCJ I 2ger.cy p~;ii;i ts ax z-oninence consti-ucvi :31'1.; A ... . . 

this poirt, the oi.rr?er discovers that S02 emissions from this source will be 

115 TPY S02 ra the? thar! 85 TPY. Assuming that there is no indication of 

attempted circumvention, the source under currect policy must s ti1 1 reapply 

and, even though already ucder cons truc t'ior!, the new appl icatior! date is 

used to a1 locate increment. If another application for a large SO2 source 

had beer! subini tted between the first ar!d second Source A appl icatiocs, 

Source A may be denied a perini t despite the constructior! costs already 

committed to the project. Today's policy, ir! contras t, provides in certain 

cases for the "preservation" of incremefit that had previously been allocated 

to a source if (1) the proposed change is not fundamental, and (2) there 

was no intent to circumvent new source review provisions. 

Preservation of ircrement refers to the retention by a review agency 

of the original complete application f iling date in determining allocation 
of increment on a first-come, first-served basis. In other words, this 

policy specifies that for administrative, minor, and significant changes, 

the original complete appl ica tion submittal date is used to a1 locate increment. 

However, the preserved incremefit is based on no more than the original 

emission rates ar?d ambient impacts. If the revised emission rates or 

ambient impacts increase, only the "original" portions of the total pew 

rates and impacts are preserved; the increases are allocated on the basis 

of the date a co~nplete applicatioc for the proposed change was submitted. 

If the revision results in emission rates or impacts less than the original 

levels, the remaining portions of the original rates or impacts are no 

locyer preserved: tnjs is because this policy is not intecded to provide 

trad5rg or cettirg credits to a proposed source. The orly intent is to 

reserve a quaiifyir?g source's piace in lice for ircrenient allocatin?. 

As ar. exa;:ipl~, assuxe Saiirc? 6 subrai tted ar origiral coinplete application 

, , for. 2.75 .TPY 55i:on Ja-i\i~&ry. 2(.1.,,.?986i, Or iiugus t 15, ,1336, before a i:t?rni t 

has been issued, Source 3 files a complete application for a chaaye which 

would increase SO2 emissions by 55 TPY, to a total 330 TPY S02. On a firs t-come, 

firs t-served basis, increment from Source B is allocated using the following 

dates: 

January 20, 1986 - 275 TPY SO2 

Aligus t 15, 1986 - 55 TPY SO2 

Note that the source's place ir lice for the original incremect is based on 

tne origical appl ica tioc date, hut that subsequent increases in emissions 

are allocated based on the date the application for the increase was filed. 

Source B, under today's policy, would not be competing for all 330 TPY SO2 

einissions on the basis of an August 15, 1986, increment allocation date as 

would have beer! the case under current policy. Ins tead, Source B competes 
for only the 55 'TPY SO* addi tional increment or? the basis of the later 

August 15, 1986, appl icatior filing date. 

Sources which had previously been exempted from PSD review present a 

particularly difficult si tuation. These nonmajor sources consume increment 

but, urlike major sources, are not allocated increment. Today's policy, 

however, a1 lows increment a1 location preservation for sources which, as a 

result of a proposed admi~istrative, minor, or sigrificant (but not a 

furdamental) charge, would become major as long as no circumvention was 

irtended. Such sources viould have increme~t allocated for the original 

ernissiors rates on the basis of the original (exemption) complete application 

:!ate ard the dddi tioc?al ei;iissior?s rates on the oasis of the proposed cha~?ge 

conplete appl icatior! d~te. iiius, the origi~al source, even though exempted 

from PS; rr'viii~~ $5 el irjj;?;f? f.)? soine de9ree of ircre!ner.t preservat.ior!. 

. . T35s ;ioliiy .15 int:?!?!!ec; t, dpp.ly to sources vih<ch have rot yet completed 

.... .. . . c.ol:j trur. cj $fie, .Tr..?? ,$Si> ru i.e;.. provj de. tnat ?xex]; te.-?..',' \ scuries ~o 

subject to FSO do rot becoin? subject to PSD until their ernissior.~ exceed the 

threshold I imi ts acd they ther propose a major modi fica tion (with ore exceptior: 

a modification to a minor source which would in itself qualify as a major 

source will result ir PSD review), but this does rot address proposed charges 

to a source prior to completion of that source. 

Sirce ircrement preserva tior using first come, first served, re1 ies 

to a great extect or the date of submission of the origi~al application, 

tnis is a particularly importart date to document. Owrers and operators 

who feel that a source is exempt from PSD review are nevertheless encouraged 

to promptly submi t complete applications for the State permit or for the 

record, even if they have already been informed verbally that a source is 

exempt, because the submissior! date establishes i~crement a1 location priorities. 

Without a clearly documented original complete application date, this policy 
wuld be difficil t to apply. In cases where the date a complete original 

application was filed cannot be determined, EPA will use the date cons truction 

is commenced. 

VI. EXTENSION OF 18-MONTH COMMENCEMENT OF CONSTRUCTION DEADLINE 

One permit revision topic that deserves special attention is extension 

of the 18-month commencement of construction dead1 ine. The subject regulation, 

40 CFR 52.21(r) (2), states that "Approval to cons truct becomes invalid if 

constructior- is rot commenced wi thin 18 months after receipt of such approval, 

if cons truction is discontinued for a period of 18 months or more, or if 

cons truction is not completed wi thin a reasonable time. The Administrator 

iaay extend the 18-niorth period upoo a satisfactory showing that an extension 

is justified. This provisioi: does not apply to the time period between 

coxtr~ictio~ of ti-:e apprsvsd phases of a phased constructiofi projsct; each 

!p'.is? ??US t c%imerc:! cops t.r:~ctior! i.ii thi~: 18 niorths of the projeczed and 

?DE~~VC.(I c3in1i::!ncexer: r. d? t.?*" : . , . . , , 

It is important to rote that the Clean Air Act and 40 CFR Part 51 

regulations do not expressly ir-clude the 18-month dead'line. Therefore, 

those States that have takei: over the PSD program through SIP development 

are not required to have the particular 18-month deadline in question. 

However, those States to whom the PSD program has been delegated are 

required to implement the 18-mooth deadline, since a delegate State is 

implementing the Federal reyulatioas. 

Of ten it is difficul t to determine in the precons truction phase how 

all aspects of the construction plan will develop. Many of the permi ts 

issued in the earlier part of the PSD program are maturicg as projects. 

Corsequently , the EPA has received several indus try requests for various 

adjustments to their permi ts and cons truc tion schedules. These requests 

are usually based upon chacges in the economy, weather, or consumer consumption 
in areas such as energy. EPA is responding to this need by interpreting 

the r e g u l a ti on and proposi ng the policy articulated here for reviewing 

extensioc requests. Effective implementation of these provisions is especial iy 

important in view of the prospects for economic growth. 

The showing which a source must make in order to receive a permit 

extension has been a longstanding problem. Various approaches have been 

advocated, rangi ng from a s tringent standard, such as impossibility in 

the legai sense, to such lesser showings as economic impracticali ty. Each 

of those approaches presented varying degrees of subjectivi ty and certain 

difficulties of factual aralysis. Today's policy avoids those difficulties 

by providirg extersions to virtual ly ail good fai th appl ica tiors for extensiors 

to which the affected States do not object. A good faith effort ;iiust include 

a certi f ica ti or tliat tne co!iipary currertiy pi ans to comi?lerce co?s truc tior 

oy a specific date tbat usual iy should fa1 l wi thir the requested extension 

. ., , ,. , . . . . . .i,:..,",". %, .but experd. .rurti-;2;- j(!tc;'",., future if i r ;s wjti,i;i.w'hijt. . . . . ., . Ltli 

the review agency co,?siders a reasonable period of time. The i~tent of 

this is to discourage si tuations where a source may not plan to actually 

commence cons truction for a number of years but corti nues to tie up incremen t 

ard consequently prevent growth which could occur immediately. 

Previous decisiors of ten a1 1 owed a source making the threshold showing 

of justification of ar extecsior to proceed wi thou t flirther aralysis. 

There are persuasive reasors for reopeni rg certain porti ons of the permi t 

review, such as BACT, when a permi t is exterded. As described below, 

today's policy expressly provides for this further analysis. Providing 

extensions more readi ly but requiri ng more substantive review of those 

extensions preserts a reasorable comproinise that simp1 ifies the pol icy 

while assuring important ervironmental protection. 
The Clean Air Act requires review of new sources to be timely. This 

is especially important for key elements of review such as BACT determinations 

and ambi ent impac t assessments. Consequently, there must be 1 imi tations on 

the period granted in which a source can construct without an updated 

review. In particular, BACT is an independent requirement under the Act 

ard the Act contemplates that the BACT be current for the period in which 

the source's cocstruction is actually commenced. Similarly, ambient air 

quality can chacge considerably, rendering inadequate an assessment performed 

at an earlier time. This policy generally outlines a method which addresses 

coocerns about the consistency of extension requirements across the country, 

wni le coriiply ing wi th the Act's requirement that certain PSD determi nations 

be timely. It is emphasized that timely requests for extensions or other 

noj: fjcatiocs are ci~e respcrsibi ii ty of the source. A permit i4ii 1 

a" toil:atically cease to exist i? a request for extension is not received 

re ."s-,expiratio.r ?&:?.-. I!: the'.case of. .a: later request, a new permi t . ., .., ,,. .~ 

application must be filed. 

Today 's policy proposes that candi da te perini t ex tecsi on8 mus t meet 

the following tests for substance and processing in order to be issued: 

A. BACT Review. EPA believes that in many cases the original BACT 

deterinination would sti I1 qualify as BACT if it were reviewed. This is 

especially the case sirce cocsideration during a BACT reevaluation is 

given to the costs that would be iccurred ic changing plans and equipment 

purchases if a differett techooloyy were employed. These costs and time 

delays may be prohibitive if cons truction had a1 ready commenced and the 

source was not designed to accommodate new state-of-the-art con trol technology, 

but EPA notes that there will also be cases in which a1 teration of construction 

plans is feasible. This could well be true of long-term, mu1 ti-unit projects 

for which major improvements in BACT have occurred and the expanded construction 
time frame has proven conducive to such project a1 terations. However, EPA 

will require a BACT reevaluation on all extension requests to the extent of 

reviewing EPA's BACTiLAER Clearinghouse. The original SACT determi nation 

can be assumed to remain appropriate, even if construction has not commenced, 

if no significant state-of-the-art advancement in BACT is noted from EPA's 

BACTILAER Clearinghouse data or from the subsequent public comment period, 

and rot more than five years has elapsed from the time of the original BACT 

determi na tioc. 

B. Additional PSO Review Requirements. Other aspects of PSD review 

such as ircrement rights acd air quality impacts will be assumed to remain 

valia urless adverse coniiiiects are received from affected State(s), Federal 

Laro ibiacagers , or other irteres ted parties duriry the public comnert period, 

sf rice subseqr~er:"igrowth ic tile area snould have cocsidered tile impacts of the 

per;:i: tted soiirce. Adverse soi;iii1e?ts, if rot reasocably addressed by the 

,... . .. . . . ...-.pp ! iczct,.w; 1.1 .typical ly .trigger tne ceed for a c:)cfe.re?ce ai::or.,: EPA, the. 

applicart, the affected State(8) , and other itteres ted parties such as 

Federal Land Managers. The cocference may be combined wi th the public 

participation requirements for extensions. The State is responsible for 

ersuring that interim source growth in the area of the perini ttrd source has 

rot caused sufficient degradation of air quali ty to the extect that operation 

of the soiirce requestirg the extension would cause or contribute to increment 

or NAAQS exceedarces; cei tiler extersiors of issued permits nor issuacce of 

addi tioral permits is allowed when they would cause or contribute to such 

exceedances. If the State icadvertently fails in this regard, it is responsible 

for remedying any subsequent violations by obtaining sufficient emissions 

reductions ir the area. The State is also responsible for indicating 

whether an ex tension consumes a1 1 remaining increment, thereby prohibi ting 

issuance of permits to other possible sources in the area. A source will 
not be subject tb any other aspects of PSD review beyond those mentioned 

above. 

C. Duration of Extension. EPA's regulations do not state the maximum 

length of extension which can be granted. In practice, EPA's Regional 

Offices have used 18 months as the norm and, in certain ins tances , have a1 lowed 

1 onger extensions. Due to concerns of growth rights and public participation, 

EPA will presumptively 1 imi t extensions to durations of 18 months, or less, 

\.if th renerial possible. This allows indus try the possibility of mu1 tiple 

extensions if necessary but ensures that the impacted State(s) and public 

have control of their air resource and growth rights and that state-of-thea? t BACT vii i I be eiiipl oynd. 

9. Public Comment. The Clear Air Act particularly emphasizes the 

'inpar tarce nf pub1 ic coinriii?r l or nd tters affect! rg air resource consumption. 

-. i:i?rc?for?, EpA iv.i 11 e the sane public participation procedures for 

:n: rimum 30-day public comment period. 

E. Extension of Later Uri ts of Phased Mu1 ti-Uni t Projects. Phased 

mu1 ti-unit projects are considered either dependent or independent by EPA. 

In a footrote in the preamble to the 1978 firal PSD regulations (43 FR 

26388), EPA defined the difference between these types of phased projects: 

"The dependence of faci 1 i ties wi thin a source wi 11 be determined or! 

an individual basis. Two or more facilities will generally be considered 

deperdent if the cors truc ti on of one bioul d necess i ta te the cons truc ti on 

of the other facili ty(ies) at the same site in order to complete a 

given project or provide a given type (not level of) service. A kraft 

pulp mi 11 is an example of a source wi th dependent facilities, whereas 

a three-boiler power plant is a typical example of a source with major 

i ndependen t faci 1 i ties ." 

The purpose of this approach was to differertiate between those phased 

projects which would be "grandfathered" (i .e., not subjected to new PSD rules) 

and those which would not. Dependent phased projects were considered fully 
committed as soon as cons truction began, so all of the dependent facilities 

were accorded the same status; if cons truction on the first phase of a dependent 

phased project commenced by an applicable grandfather date, then all of the 

dependent facilities were considered grandfathered even if cons truction of 

those phases of the project had not yet commenced. Conversely, each phase 

of an independent phased construction project had to individually commence 

cocstruction by the gra~dfather date to be grandfathered. This approach to 

phased projects was upheld in Alabama Power Co. v. Costle. 

The 1978 preamble also states that EPA does not generally intend to 

limit the time for cor?struction of phased projects, but does intend to 

:.?quire commencement of cors truction of the first phase wi thin 18 monihs of 

perrni t approval and of subsequent phases witliii? 18 inonths of the date 

aj~rsveci :I? th? i;zrnii t. Breaks ir cops truct.ior, as wi t!i single-phase 

prsji.cts, cari:ot exceed 18 morths. These require1ner:ts apGear in 40 CFR 

. . ..- ..pirt 52.,21(r)(2), !~ri~:e ..i-.~te!!sioi\s. of -the t'ize per5od betwpec. c3nstrci::tis:r , .. . 

of different phases cf phased construction projects are not allowed. 

The Utilities Air Regulatory Group (UARG) has peti tioned EPA to delete 

the portion of the regula tion 1 imi ting extensions of permitted cons truction 

i c7.tervals between phases at phased cons truction projects. Si nce the regul ation 

could be i~terpreted as a1 lowirg for extefision of the construction commencement 

deadline only for the first phase of independert, mu1 ti-unit projects, and 

s i rce mos1 u ti 1 i tj cons truction projects are phased irdependect mu1 ti-uni t 

projects, UARG is concerted that the reyulations prohibi t extensions for 

1 ater phases of these uti 1 i ty independent mu1 ti-phase projects. 

In response, EPA provides the following clarifications. First, it is 

EPA policy that both dependert and independent phased projects may obtain a 

single comprehensive PSD permit for all phases of the project. A single 

permit offers an applicant the advantages of reduced paperwork and assurance 
that the entire project (rather than only a portion of it) is permitted. 

Since comprehensive permi ts apply to projects which are of ten large and complex, 

such permi ts should specify at least two i tems that are not needed in permi ts 

for single-phase projects. These i teins are: 

(i) Which BACT determinations will be reassessed prior to commencement 

of construction, and 

(ii) The date by which later phases (but not necessarily the initial 

phase) of tile project must commer?ce construction. 

BACT review (and redeterminations of BACT as appropriate) is required by 

40 CFR 52.21(j) (4) at the latest reasonable time which occurs no later than 

Id moo tns prior to comcnercemen t of construction of each independent phase 

of a project, so irclusior ir a permit of the BACT determinatiors which wi 11 

be reassessed is rot a requ;r?mert for beirg able to coriduct sucn a reassessment. 

i-i3:,1ever, the irclvslor of this inforinatior ir the perini t proviries the 

w-er,c.pe.?a.tor ,.. the i.rs.pfr",or,:and the pub1i.c advance notice :of thi. .i cter,.t . . . . .. ,. . 

of the review agercy to conduct such a reassessnent. 

The commence cocstruction dates ir the permit cannot be exteqded using 

the mechanism embodied in 40 CFR 52.21(r) (2) , but this does not mean that 

such dates are unchangeable. In fact, those dates - can be changed, but not 

by the granting of ex tensi ons. Since these dates are a part of the perrni t, 

changes to the dates require a permi t change, which will usually be considered 

an adolir.istrative change (albeit ore which rormally should irclude BACT review 

ard public participation). The "projected and approved commencement date" 

referred to in 40 CFR 52.21(r)(2) is the date which appears in the permit, 

a date which can be changed by revising the permi t. The procedure for 

changing commerce construction dates which are embodied in a permit is 

the same procedure used for any other permi t change, as outlined in today's 

policy. The initial phase commence construction date is extendable using 

3 1 

EPA7APCO 1 3328 
the 40 CFR ~art'52.21(4)(2) procedure urless that date is also embodied in 

the permit. Wher embodied ir! a permit, ever the iri tial phase comineoce 

cor!struction date can be changed only through a permit charge. 

The above policy cor!cernir?g the initial phase commence corstructior date 

may appear to corflict with 40 CFR 52.21(r,)(2); it does not. The irtent of 

40 CFR 52.21(r)(2) is to establish an automatic 18-month expiration date 

for permits, with provisions for exterding the expiratior! date or? a caseby-case basis. For phased projects with a sirgle comprehersive permit, EPA 

presumed that commercemer!t dates for each phase of the project, except the 

iri tial phase commercemert date, would be incorporated into the permit. 

Thzrefore, i ri ti a1 phase cominerceiaer t cia te charges would be hard; ed wi th 

a @O CF!? 52.21(r) (2) extersior, and subsequert phase commencernett dates 

:,:~ui d "i i16i?di ec: ti?ro,yi-i jit?r!ni t charges. This ack~oviedges ar!d jreser ves 

tihe validity arid Icga!. ty .,f the cordi tiors specified ir a permit. 

.. . .. . 11: =or .some rezso?,,-c_:~i!!. 3s a lorg ?lac"?>> lead time on a complex 

project, the iri tial phase coclmerceinert date is lor?ger thar 18 niorths but 

s ti1 1 within a reasorable period of time (e.g., 2 years and 6 morths), the 

review agercy may specify the iritial phase commer!cement date in the permit, 

keepirg ir ini r!d that tile source is grarted 18 morths beyord this date to 

actually commence cors tructior. A1 terratively, the review agency may specify 

tile permit expiratjar date ir the permi t. The expiratior date simply ircludes 

the iti tial 18-morth grace period; it is determired by addirg 18 inorths to 

the commerce corstructior date ard avoids the corfusior! that could result 

wher! dealicg with the commerce corstructior! date alore. The specified date 

ir? the permit takes precedent over the "automatic" 18-month expiratior! based 

or the permit issuaoce date, but ir! doirg so rerders the permit ineligible 

for the 18-mor?th extensior process described ir! 40 CFK 52.21(r)(2); a permit 

change is required to charge a commencement (or expiration) date that appears 
in a permi t. here is an exception to this: if the date specified in the 

permit for the initial phase of a project is simply the expiration date of 

the permit (the commence construction date plus the 18-month grace period), 

then that date is assumed to be in the permit for information purposes, 

does not make the source inel igible for 40 CFR 52.21(4) (21) extecsions, 

and does not need to be changed to grant extensions of the expiration date. 

For some projects, the commence construction dates for each phase may 

have beer. ircluded ir the application or other materials, but may not appear 

ie the permit. In such cases, the commencement dates for each phase are 

those dates which the review agency used in evaluating the impact the 

source would have. Nearly always these will be the dates submitted by the 

applicart in tne appl icatior, ard these coininencemeet dates are chacyed by 

fc;l lowitg today's ?oiicy or cliargi cy applicatiors ard permits. As a part 

of ary such chacge, r?v:rw agsrcies sho~ild cot orly revise the dates in the 

i ca tior,, .-but. als:? irc1;d.e the i;x.tended..c-ommer,remer t or exp4ration. date 

i: a revised permi t. 

Independent phased mu1 ti-uci t projects have the option of havicg 

separate permits for each phase; dependent phased projects do not have this 

optior, because all phases of a dependent project must be completed for that . 

project to operate as intended. Separate permits for each phase of an 

i rdependert phased project are treated for processi ng purposes as if each 

permi t was for a separate faci 1 i ty, wi th icdeperdert commencement dates, 

?ACT determi na tions , enforcement actions, etc. Separate permi ts may increase 

paperwork, but in return provide an applicant with the optior? of proceeding 

with planring on a project one phase at a time. 

The concept of "separate" permi ts versus a sf ngle comprehecsive permit 

is more a matter of the manner in which the phases are treated than the 

physical manner in which the permit is issued. A single comprehensive 
permit, for example, could consist of a number of permits for various 

emission uni ts and phases of the project, with possibly a general permit 

to address condi tions common to a1 1 the project facilities. Conversely, 

"separate" permits for an independent phased project may physically consist 

of a "single" permi t which nevertheless treats each phase separately. Of 

course, EPA would presume that single and mu1 tiple permits were what they 

appeared to be unless there actually existed some clear basis for treating a 

sirgle permit as a set of separate permits, and vice versa. 

The reason for dis tinguishing between dependent and independent phased 

projects 1 ies in the appl icabi 1 i ty determinations when new or revised PSD 

rules becoilie effective after corstruction comiiierces oi: the ici tial phase, 

but before constructiol! coinmerces on the last phase. All phases of dependent 

lp?ased projects are grdr!afatilered [not subject to tile new or revised PSD 

rgles if cars tructior ;ii? the p?~j~?it (USUS! ly the first phase) had coiniiierced 

L* ;, .$k,e-.eff,?ctiv? d.?:?. of the rsie cfiarge and rc, irialidi ty ii,pses jr! . . 

corstructior had occtirred]. In contrast, each phase of an icdependent 

pnased cocs tructiori project mus t individual ly cominerce cons truction by the 

prescribed grandfather date(s); any phases which had commenced construction 

would rot be subject to the rew rules. 

Since the concerr expressed by UARG appears to be addressed toward 

mu1 ti-uci t power plarts which may have beer permitted as depecdect, rather 

tnar irde~erdert, mu1 tiphased projects, today's pol icy offers irdeperdent 

phased project applicacts ar opportunity to convert (or otherwise obtain 

ackrowledgement from the review agency of such change in project classificztion) a deperden t mu1 tipnased project permi t for that project into independent 

mu1 ti phased project perini ts wi th full preservation of the increment allocated 

by the original permi t, as long as no increment or NAAQS exceedances would 

result. This conversion (but pot any simultaneous or subsequent requests 
for other actions, such as extensions) would be carried out without addi tional 

?SO review requirements, such as review of BACT, although such conversion 

does not abrogate any other authority either EPA or other review agencies 

have to reasssess permi t analyses. In particular, this conversion would 

rot allow circumvention of the BACT review prior to construction of each 

irdependent phase which is required in 40 CFR 52.21(j)(4). 

UAKG also expressed concern regarding the time taken by review agencies 

to decide whether to grart construction date extensions, ci ting a case where 

an appl icant fe1 t forced to initiate cons truction simply to protect the 

validity of the permit because no response to the request for an extension 

hat1 beer, received. Ai tliough the new policy described above of providing 

extersions to virtually all good faith applications should resolve this 

problei~, EPA shares the coyerr of UARG that such "forced coostructio~?" be 

pre\i?rted. Therefor?, todiy's pol <cy will also ircorporate the fo:lowirg 

ap;)rcac;: ir hacdl ins sach :'iqi;ej.ts 

(1) A source has ar, obliyatior to provide sufficient time for an agency to 

review requests for extersion of a conlinencement of construction date. Therefore, such requests (i ncludi ng adequate documentation) should be submitted 

to the review agency at least six months prior to the date on which the 

permi t would become inval id ( the scheduled commencement of construction 

date plus 18 morths). 

(2) EPA will inake every effort to respord to sucli requests wi thin three 

months of the date the request for an extension is submitted. 

(3) If a request was submitted in accordance with paragraph (1) above, 

ard EPA has not responded within the three-month ti~ne period indicated 

.;r paragraph (2) above, the? the permit invalidation date will be considered 

extended automatically in such a manner that an applicant will always have 

at least three months between the date on which EPA does respond and the 
rew permi t invalidation date. The three months provides the applicant time 

to either commence cocs truction or take other action. This policy does not 

apply if the appl icant does not meet the obi igation expressed ia paragraph 

(1); ir such cases, there is no automatic extension of the invalidation 

date. 

For example, assume a permit was issued for a large project with an 

anticipated commencement of construction date of 2/1/86. The date the 

perm; t would become invalid (unless cons truction had commenced) is 18 inonths 

after this date: 8/1/87. On 1/30/86, the source applies for an 18-month 

ex tersion, meeting the six-months-in-advance source obligation. If EPA 

agrees to tile extecsior, then the extension is for 18 months from ei the[. 

the :avalidatior? date (8/1/87) or the date EPA respoaded, whichever is 

late:.. If EPA &sapcraves ai?y extersion, the irvai?datior date is either 

7 0:. three niorths 1 the date of iPA's resgorse, wh5chever is later, 

, .' . ?RGTECT!Qh OF S){CRT-TE?i{ #,MSiENT STAIID#,XU$ , . . , 

1 t has been the practice of many review ageccies to presume that any 

einissiors 1 imi t compr-ises a "not- to-be-exceeded" co~tinuous emissions 1 imi t, 

whether that limit is ircluded ia the permit (e.g., "SO2 emissior?s shall not 

exceed 875 pounds per hour"), referenced in the permit specifically (e.g., - 

"this source is subject to Regulation 6, Section IV.A.Z.b.(ii), for fossil 

fuel-fired steam generators"), or referenced gereral ly (e.g., - "I;? addi tion 

to the specific cordi tions coctained hereir, source is subject to a1 I 

applicable rules al?d regulations.. ."). That this assumption is widely held 

is evident in the number of cases where the review agency (and applicant) 

uses an emissions limit to determine 3-hour and 24-hour amb'ient air impacts, 

but does cot specify the averaging time for the emissions limit. The New 

Source Perfor~narce Stardards (NSPS) have reinforced this assumption of a 

continuous emissions 1 imi t through the prescribed reference test methods, 
which generally average three or more samples taken over periods of time 

ranging from one to three hours. Thus, use of NSPS limits or NSPS test 

methods has been considered sufficient indication of the intent of the 

review agency to establish not-to-be-exceeded continuous emissions 1 imi ts. 

A divergence between the NSPS emissio~s rate averaging time for fossil 

fuel-fired steam generating uni ts and the PSD emissio~s rate averaging time 

requ<rements for these same uni ts is affecting this assumed interrelationship. 

Protection of the PSD SO2 increments requires einission limits with averaging 

times no longer than the averaging times for the increment. Thus. compliance 

w? th a 3-hour SO2 increment requires an emissions limit averaging time of 

3 iiours or less. For exanple, assume that a continuous emissions limit is 

2stablished for a source at a level that would result in a 3-hour ambient 

.> :.,+act :- r almost iderticdi to tile ambient impact ircrement ai lowed; the emissioc! 

1 'mi t pre\lenis ":i:.akU e:niss io.? rates ttiat coiild resul t ir exceedarces 

.he iccrener. t.. An emi ssio-s 1 init with a 6-,.hoiir averagi rg- time wo!il c ... , 

rot recessarily provide this protection; a 3-hour "peak" could be offset 

by a 3-hour "low" to meet the 6-hour average emission limit, but tile ambient 

impact during the 3-hour "peak" would exceed the 3-hour incremen t. 

On October 21, 1983 (48 FR 48960), EPA proposed new SO2 compliance, 

emissions measurement, and reporting requirements for sources subject to 

rieiri Source Performance Stardards (NSPS) under 40 CFR 60 Subpart D (fossil 

fuel-fired steam gererators larger than 250 million btu per hour heat input). 

This proposal would require Sc)2 cornpl iance testing agains t the existing 

numerical NSPS 1;mi ts of 1.2 and 0.8 pounds SO2 per million btu for coal 

ard oil, respectively, but requires compliance demonstrations on a continuous 

basis through the use of continuous emission monitors (CEM) or fuel sulfur 

aralysis (FSA). Sulfur dioxSde emissions would be calculated on a rolling 

30-day average basis instead of a short-term (approximately 3-hour) stack 
test. A1 though a roll ing 30-day average NSPS (Subpart Da) had been promulgated 

on Juae 11, 1979, for new electric utility boilers (44 FR 33580), the 

Oc tober 21, 1983, action would apply after the fact to nearly 500 operating 

Subpart D units for which the ir.i tial permits relied to some degree on the 

presumption that compliance with the NSPS would be achieved on a continuous 

short-term (3-hour and 24-hour) basis rather than on a continuous 30-day 

rolling average basis. Many reviewing agencies have determined air quality 

<mi)~ts bymodelirg the NSPS limit (1.2 or 0.8 pound SO2 per million btu) 

as the maximuin short-term emissior! rate for most Subpart D and many Subpart Da 

sources, but did not specify such short-term analyses or continuous compliance 

p:.ocedurcs 'ic t!iei r perm; t cordi tf ons. 

Ar? ernissior levei which averages 1.2 pound S02 per millior t~tu over a 

iisriod of 30 clays car oi: a short-term basis be nigher Char that limit as 

. . 1x9 as ths 30-day s:nI;s:o?s zverage at ctr Seiow 1.2 pounds SO2 per millio~ btu. 

r p sx:!>ip! 5, . . .].Q .jr!.ys a:.. 1 ,3 pr::ci.nr. S3- % 2: mi 1-1 (on. Sti; 3rd 23 days ,of !;0 pou~ds . 

per million btu wjl I average 1.1 pounds S02 per mil'lion btu and ineet the 

30-day average NSPS, but will exceed 1.2 pounds SO2 per million btu for 10 of 

the 30 days. This is not intended to imply that a rolling 30-day average 

makes possible extremely large variations in emissions rates; it does not. 

The 10 days of 1.3 pounds SO2 per million btu, for example, had to also be 

cornpersated for by the 20 days preceediny th.is higher 10-day rate, sirce 

this is a rollifig average. Hoiever, policy is required to avoid confusion 

by both sources acd review agencies regarding what short-term and long-term 

emission limi ts must be met by sources affected by these NSPS revisions. 

Since the most important role of PSD permits is to prevent significant 

deterioration, EPA's pol icy regarding perini ts affected by this and utlier NSPS 

revisions is based on the effect of these actions on the ambient air. The 

NSPS action was based on both technical and cost co~siderations, but the 

3 8 EPA7APc013335 
revisions of perhi ts for any PSD sources, whether related to NSPS revisions 

or cot, are based or! PSD goals and air quality considerations. 

A. Subpart D Sources 

EPA's policy regarding PSD permi ts for Subpart D sources affected by 

the October 21, 1983, NSPS proposed revision is this: 

(1) If there are any SO2 emissioc limits (e.g., pounds SO2 per hour, 

poucds SO2 per megawatt, etc.) in the permit, these liini tations represent BACT 

acd inust be met by the source unless and until such limits are altered by a 

permit change usicg the procedures specified in today's policy. Any permit 

emission limit is considered a limit which must be complied with continuously 

 inl less specified otherwise. 

(2) PSD permi t eini ssion avzragi ng tiines are co~?siderecl short- term 

averaGes, ever. for the Subpart O NS?S 1 imi ts, as loiig as it car! reasorably 

be presumed that at tii+ t'me of permit issiiance the emissions limi ts were 

crsidered-,550~ t- ternern;ss;or 1im.i ts .(e..g, , by use of such 1 iiai t..in.:nodel; 

3-hour or 24-hour ambient impacts). That lirni t remains a short-terii! limit 

(regardless of the regulatory revisions to the NSPS) unless and unt! 1 the 

permit is changed to specifically indicate otherwise. In fact, a short-term 

emission 1 i~ni t may not always be included as part of the permi t (a1 though 

good permit processicg practices encourage the inclusion of - all applicable 

condi tions and 1 imi ta tiors); the 1 imi ts used in demons tration of short-term 

amb<ei!t air impacts comprise correspocding short-term emissions 1 imi ts. 

(3) If the ocly SO2 emissio~ limits associated with the permit are 

specifically stated to be long-term (longer than the 3-hour and 24-hour 

averaging times) and no short-term SO2 ambient air impacts were determil?ed, 

the PSD permit is incomplete, the 3-hour and 24-hour increments and NAAQS 

must be protected, and an analysis is needed to provide such assurance. 

In this case, the review agency (without wai ting for a request from the 

3 9 

EPA7APCO13336 
source) must reassess short-term inipacts for all sources on the basis of 

maximum articipated short-term emissions. If the legal authori ty exists 

for a review agency to ini tiate revision of ar incomplete PSD permi t, the 

ageccy should do so, specifying short-term limits. If a request for a permit 

revision must be ini tiated by the applicant, the agency should not only 

irclude short-term 1 imi ts at the first opportunity, but also encourage the 

source to apply for a revisior. At the least, any new levels of increment 

ard iiAAQS coilsumptior resul tiny from a lack of enforceable short-term emission 

limits must be taken jnto account in future PSD permit analyses. If increment 

or NAAQS exceedances are predicted by the new analysis, the review agency 

in:ist act to prevert sucii exceedarces. The review agercy must also estabiish 

a policy providirg short-term I irni ts on PSD permits to protect shol't-term 

; "r'.,n > , . 1. d?d >!,$t!lX. 

I,-. fj. , , , , ti?. ;IOS 5 ,: $3 I e zxc?(>ti or of thcsc sour-ces fa1 1 i rig u?der. :paragraph (3) 

3'39ve, owers arc operatcrs 3: sosrces witii 2SD peri!!i ts i.iisiiirg to take 

acvartage of the relief from sol fur variab.ili ty offered by the rol lirg 30-day 

average NSPS must apply for a PSD permit change and obtair a revised permit if 

exceedance of the NSPS or BACT emission level on a short-term (including 

aever-to-be-exceeded and 3- or 24-hour) basis is anticipated. To be granted, 

these permi t change requests mu8 t meet two criteria: 

(1) The source nus t de~nors trate that ary BACT level of compliance embodied 

ir the permit (ircludirg BACT 1 imi ts with shorter averaging times as well as 

more s tringent 1 imi ts) is ei ther (a) no longer feasible on either a technological 

or economic basis, or (b) wi 11 s ti 11 be ensured by the use of the longer 

.term average. 

(2) The source must demonstrate that neither the NAAQS nor the increments 

for SO2 would be exceeded (as demonstrated by dispersion modeling) by afiy 

revised short-term emission 1 imi ts contained in ei ther permi ts or the SIP. 
During the processing of such requests, the review agency must take 

the opportuni ty to provide specific emission 1 imi ts or other permit condi tions 

which protect all applicable NAAQS and PSD increments. A1 though it is 

EPA's pol iiy that the emissions limi ts used to determine compliance with 

short-term increments and NAAQS are enforceable even if such limits are not 

specified ir the permit itself, €PA strongly encourages the inclusion of 

- all applicable emissions limits, operating parameters, fuel specifications, 

averaging times, compliance nietliods, and other requirements in the permit. 

Such action will both decrease uncertainty regarding the limi tatiocs a 

source mu8 t meet and reinforce the legal basis of such 1 imi tations. The 

i jrni ta tiocs, to be fill ly effective, nus t specify averagi~g tim?s corresponding 

to ace or more short time periods consistent with the limiting Psi) iccrement 

or !.:?,AQS (e.g., pounds S07 per hour). A iimi tatioo such as pounds SO2 per 

rii I Ibr btir neat, irput is an excel lent control techrology 1 imi tatioc, hiit 

he trieiieat input (So: !er !o?,d) 31. thee:iiissions per uni t of time inus t 

also be 1 ini ted to provide anibiect air impact protection. 

5. Subpart Da Sources 

On June 11, 1979 (44 FR 33580), EPA promulgated new requirements for 

electric uti li ty boilers (Subpart Da sources). These new requi:-ements, 

actually in effect since September 18, 1978 (43 FR 52154), specified a 

rolling 30-day average NSPS for SO2 for new Subpart Da sources. PSD permits 

issued sunsequen t to these cia tes, a1 though irtecded to protect short-term 

as well as long-term increments and standards, may specify in the permit 

only the rolling 30-day average NSPS as an SO2 emission limitation. This 

si tuation differs from that.of Subpart D sources ir! that the NSPS for 

Subpart Da sources was not applied retroactively to sources alroady permi tted; 

the Subpart Da permi ts were issued by review agencies wi th f ul l know1 edge 

that the SO2 NSPS was a long-term (rolling30-day average) limi tation. EPA 
cannot presume that agencies considered the revised Subpart Da NSPS to be a 

"never-to-be-exceeded" short-term emission limitation as was assumed for 

the Subpart D sources. 

As a result, EPA's policy regarding PSD permits for Subpart Da sources 

is this: 

(1) If the PSD permi t contains (or incorporates by reference) short-term 

S07 emissions limits, those limits must also (in addition to the Subpart Da 

NSPS) be met by the source acd presumably represent BACT. The emission 

1 imi t averagirg times, ever if not specifically stated (e.g., pounds per 

hour), are considered short-term averages as long as it can redsorably be 

p:.iisu;iied that they were carsidered as such (e.g., - by use of such liiiiit in 

model i ry 3-hour or 24-nour ainb<e~t impacts). These enissiocs 1 <mi ts ther 

coinjrise e:r'orcea!)!ir silar c-ierin !im; ts wh;ch adequately protect the :<-hour 

8 y.3 '2-i?aijr i c :;A,\?S a 

.. .. 7:. ,-If: ti7.e Ci;g 3cmci't; t L, ,, !jr~?s.?ot cartair: (or ificorporate ; rsferefice) ,. ., , 

i - i 

snor t-term SO? einissioi: 1 :'mi ts adequate to protect short-term ircreinents 

and NAAQS, the review agercy responsible for PSD permits must take the 

fol lowiny actions wi thii: six months of the date of publication of this policy 

:' c tlie FEDERAL REGISTER. 

(a) Reassess short-term impacts for all such sources on the basis of 

naxiaum articipated short-term emissions and take these new ificreinent 

cor.sumption levels irto accoupt ir future PSD permit analyses. 

(b) If increment exceedances are predicted by the new analysis, develop 

a revision to the SIP to prevent such exceedances. 

(c) Develop and iinp:..-riiert a policy or reyulatior! requiring short-term 

1 iini ts in PSD permi ts that adequately protect short-term increments. 
A report to EPA on the actions taken and the sources acd areas affected 

by these actions must be submitted by the responsible review agency within 

8 months of publication of this policy in the FEDERAL REGISTER. 

C. ~aximurn Anticipated Shor t-Term Emissions 

Normally, ambient air impacts during permit processing are based on 

maximum allowable emissions since the source is not yet operating. Then, 

when the source begins operatiny, impacts are based on actual representative 

em;ssions. In these Subpart D and Da NSPS cases, however, not only is the 

soiurce likaly to already be in operation (which calls for use of actual 

en:'ssions), but also there may not be any specified short-term emission 

, 2F ; . .,n. :a tioc (so that ro a! I~i~able em;ssion limits are specified). S\i'ce 

these sourc?s have been issued PSD permits (if the PSD permit has cot yet 

b2_.!: isSii2d ~. ,L' ~nere is s ti ! i opportur:i ty KO -include !n the perini t short-terin 

. . .: ., ,.- ..?: ., - . .,,." 11:::; Ir, ti;i:s a,~~ooiiil:i:~ this p:-oblem), ir?formatior: on fuel-sulfur 

,,.. . ,i;--ab<.]{.bj, si>oii!d i?b.!e. . For exa~pje the 24-h~ur average f';le;. . , ., .. ,.-, , 

sdinjjles or 24-hour CEM averages required by the NSPS for calculating rolling 

30-day averayes can be used directly to determine the variatior in 24-hour 

SO2 emission levels that can occur with the specific fuel beicg used by a 

sl~ecific source. Standard statistical techniques can determine the 3 siyma 

upper bound on the values and this 3 sigma value can be used as the maximum 

a?.t;cipated 24-hour emissioas level. 

I? aadi tioc, the range of anticipated 3-hour emission levels can be 

derived froin the 24-hour averages, a series of 30-day averages, and the annual 

a,verage. From this range of 3-hour values, an equivalent 3 sigina maximum 

anticipated 3-hour emissicr level can be derived. 

It should be noted that these short-term "maximum anticipated" emission 

levels are not enforceable (unless incorporated--specifically or by reference-- 

ipto .the applicable regulation or permi t). They are instead a statistical 
estimate of the actual short-term emissions antici pated at a source based 

on the characteristics of the fuel that source is using. As such, they 

consti tute an estimate of actual short-term emissions that can be used to 

assess short-term ambient air impacts in lieu of specific 1 imi tations. 

D. Compliance with Short-Term Emission Limi tations 

In an effort to balance the cost of gathering data and the need for 

data to determi ce compliance wi th short-term emissions 1 imi ts, EPA ir? today's 

pol icy is placirg nios t of the emphasis on 24-hour average emissiors data. 

There are two reasons for this: 

(1) The NSFS for Subpart D and Da sources require that collection of 

~ata be based on 24-iiodr tine periods. The average of 30 of these 24-hour 

average eniissiors :-a tes is the erforceable 1 imi t, but the emissions rates 

are availaSi@ d-d ;!ie ~iior; tori~lg equiI,inert ir place as a resui t crf the I<S?S 

p ?t :. .- , At riics t, tijtldy's pol<cy ?ti i 1 requ:re ol?iy that d3ta be col lecieti 

. . . ,,, - ,2rd .r;lpcrtes- ?s 'c:'ivi d;.i5,1 .?S..i?o:~c a5d.e?agej $3. addi tior to the .ro; 1 irg . . , . , ,, . 

3C-day average. 

(2) For iiiacy of these sources, the fuel is handled in such yuanti ties that 

even if data on emissions are available almost immediately, little or nothing 

could be dore. For example, a low sulfur coal-fired boiler bunker inay hold 

an 8 (or more) hour supply of coal; even if a CEM is in use (rather thar! fuel 

sarnpl'irg) , the krowl edge that d 3-hour average 1 {mi t has just been exceeded 

does little good; there is arother 5 (or more) hour supply of coal in the 

burker which has to be burced before any corrective steps (such as blending 

ir a lowr sulfur coal) take effect. Fuel sampling analysis (FSA) increases 

even further the time required to respond because it takes longer to obtain 

the sampling resul ts. 

From the above, it follows that the best approach to compliance with 

a 3-hour average emissions limit is to project, based on sampling data 
representing ei ther the sulfur content of the fuel or sulfur dioxide emissions, 

tne maximu~n anticipated 3-hour average emissions rate. As long as the projected 

rate is l ess than the a1 lowable short-term emissions limit, the source 

wauld be considered in compliance with the 3-hour emmission limit, with one 

exception: if 3-hour average emission rate data are available (e.g., - from a 

CEM or stack tes ting) acd show exceedance of the 3-hour average a1 1 owabl e 

limi t, then the 3-hour data can provide the basis for a noncompliance 

determi na tion. 

Thus, today's policy is that for PSD emissions limit compliance purposes, 

S!~bpart D and Da sources need gather only 24-hour average emissions data, 

?Sit< a !nethod (CEM or is:\) specified by the appropriate NSPS. The 24-hotir 

3>,erayes must, however, be reported individually rather than as rolliag 30-day 

~3 .<, c2 cs, ,., - a::d a statistical aralysjs iriust be corducted iri tially, tiler: arr~ally 

( ..,. -':>rs .- wa:-~i:ci .ir! :.:ri tirc; !,y the revfew agency) ai?d whe;?ever the ::re1 s;ilfli? 

t (i: .-t.rms 3f prgt~r:?~ .~f.-Ei+ per: m;'.ll.jor $tu) inay. have.chafiyed as , .. . . 

eglderced by (1) use of fuel froin a different source, or (2) evidence of 

a c?,aage in che average sulfur coctect of the fuel or sulfur dioxide emissions 

rate of the source. 

Sources subject to tile rolling 30-day average SO2 NSPS must submit 

their ici tial report to EPA by (6 months from the date this policy is proposed 

i r the FEDERAL REGISTER). The ici tial report shall include sufficient 

24-hour average einissiorc rate data to demonstrate (1) compliance with any 

24-h3ur emi ssion 1 inti tatioa, and (2) that 24-hour SO2 increment exceedances 

are not being caused or contributed to by the source. In addition, the 

.report shall include a stetistical analysis (or specific sampling data) 

showing the maxinium anticipated 3-hour average SO2 emissions rate expected 

to occur. Subsequent reports of 24-hour average $02 emission rates are to 

be subini tted with the NSPS emissions data. 
VIII. AMBIENT IMPACT EQUIVALENTS 

Proposed changes to permi ts can affect the ambient air impacts of a 

source without changing the level of emissions from the source. For example, 

a shorter stack could increase ground level ambient impacts; so could 

relocation of a planned emissions uni t closer to the source's restricted 

access boundary. Proposed changes of this type must also be taken into account, 

and today's policy proposes doir!g so by establishing the concept of equivalent 

ai?b;ent iinpacts. 

When a change is proposed which would result ir! changes in the source's 

arnbient impacts, today's pol icy proposes the foll owing (unless some other 

ij?cct ~f tli? change req~iirss inore extens'ive docuinen ta tior! or review) : 

(1) i?ecreases in ambiert air impacts are processed as aidnSristrative 

c';qes. 

. . (2) Ii::reds~?s I. rn5? 3 1"i)acts are subjected t3 a;~pro?riate 

.?e?siorl?ode-l.ins. to -rietermine t!?e equiv21ent eniss-ions .<ncrili?se from the . ,.. 

p!-eciiange source or emissiocs unit which would produce the same ?rnpact as 

t'ne proposed change. The equivalert emissions level is used to determine 

whether the proposed change is minor or significant. 

In many cases, ambien t impacts, once modeled, are proportioral to 

emissions increases and decreases; if, for example, emissions double, the 

anihient impact doubles. For such cases, the equivalent emissions increase 

csr 3e determined by ratio: 

E = Eo (In/Io) - Eo 

where: E = "equivalent" emissions rate change, grams per second 

Eo = original. (prechange) emissions rate, grams per second 

I, = postchange ambient impact, micrograms per cubic ineter 

1, = prechange ambient impact, micrograms per cubic meter 
1, and lo, must be based on the same averdying time and must represent 

the maximum ambient air inipact increase resulting from the proposed change. 

If there is co proportional relationship between emissions acd ambient 

impacts, dispersioc modeling usicg different emissions rates may be necessary 

to determine equivalents. Ac,y such complex cases should be handled by 

appropriate model icg experts. 

IX. CONCLUSION 

i4e be1 ieve tliat today's proposed pol.icy statement addresses the 

classificatior! and processicg of the types of change requests most of ten 

referred to EPA for col?suI tation. Because of the wide range of activity 

sdbjeit to proposed scjiirce cliar!ges, the Agercy especSal ly sol ici ts commec t 

frsm tllo~i? with experi2cce i this area regardicg whether addi tioedl issues 

toi,jcs silodid Se ..i,,,- , cliid~d. S‘;miiarly, EPA seeks cominect reyarairg the 

,111:tcintiai f of int y?w?al dpprodch deviijoped for processirg 

- Admi ci s tra tor