Further clarification ofthis guidance and application ofAppendix W for the 1

‐hour NO2 standard was published March 1, 2011 and is available in the Region 7 NSR Policy& Guidance database.

http://www.epa.gov/region07/air/nsr/nsrmemos/appwno2_2.pdfMEMORANDUMUNITED STATES ENVIRONMENTAL PROTECTION AGENCY RESEARCHTRIANGLE PARK, NC 27711 

## JUN 29 2010

OFFICE OF AlA QUALITY PLANNING AND STANDARDS

SUBJECT: Guidance Concerningthe Implementation ofthe I-hourN02NAAQS for the Prevention of**Significan~tete** i,ration**pro r**  FROM: Stephen D

. Page, Directo

# ~L.lA**/** Office ofAir Quality Plil' ni g

## ;;tcIsfa~da**rd** TO: Regional Air Division Directors
On January 22, 2010, the Environmental Protection Agency (EPA) announced a new 1- hour nitrogen dioxide (N02) National Ambient Air Quality Standard (hereinafter, either the 1- hour N02NAAQS or I-hourN02 standard) of 100 parts per billion (Ppb), which is attained when the 3

-year average ofthe 98th-percentile ofthe annual distribution ofdaily maximum 1- hour concentrations does not exceed 100 ppb at each monitor within an area. EPA revised the primary N02NAAQS to provide the requisite protection ofpublic health. The final rule for the
new I-hour N02NAAQS was published in the Federal Register on February 9, 2010 (75 FR 6474), and the standard became effective on April 12, 2010. EPA policy provides that any federal Prevention ofSignificant Deterioration (PSD) permit issued under 40 CFR 52.21 on or after that effective date must contain a demonstration ofsource compliance with the new I-hour N02 standard.

EPA is aware ofreports from stakeholders indicating that some sources
- both existing and proposed

- are modeling potential violations ofthe I-hourN02 standard. In many cases, the affected units are emergency electric generators and pump stations, where short stacks and limited property rights exist. However, larger sources, including coal-fired and natural gas-fired power plants, refineries, and paper mills, could also model potential violations ofthe new N02 NAAQS.

To respond to these reports and facilitate the PSD permitting ofnew and modified ma jor
stationary sources, we are issuing the attached guidance, in the form oftwo memoranda, for implementing the new I-hourN02NAAQS under the PSD permit program. The guidance contained in the attached memoranda addresses two areas. The first memorandum, titled, "General Guidance for Implementing the I-hour N02 National Ambient Air Quality Standard in Prevention ofSignificant DeteriorationPermits, Including an Interim I-hourN02Significant Impact Level," includes guidance for the preparation and review ofPSD permits with respect to the new I-hour N02standard. This guidance memorandum sets forth a recommended interim 1- hourN02significant impact level (SIL) that states may consider when carrying out the r equired

Internet Address (URL). hHp:/Iwww.epa.gov RecycledIRecyclable • Printed wHh Vegetable Oit Based Inks on Recycled Paper (Minimum 25% Poslconsumer)PSD air quality analysis for N02 , until EPA promulgates a I-hour N02SIL via rulemaking. The second memorandum, titled "Applicability ofAppendix W Modeling Guidance for the I-hour N02National Ambient Air Quality Standard," includes specific modeling guidance for estimating ambient N02 concentrations and determining compliance with the new I-hour N02 standard.

This guidance does not bind state and local governments and the public as a matter of law. Nevertheless, we believethat state and local air agencies and industry will find this guidance useful when carrying out the PSD permit process. We believe it will provide a consistent approach for estimating N02air quality impacts from proposed construction or modification ofNOx emissions sources. For the most part, the attached guidance reiterates existing policy and guidance, but focuses onhow this information is relevant to implementation ofthe new I-hourN02 NAAQS.

Please review the guidance included in the two attached memoranda. Ifyou have questions regarding the general implementation guidance contained in the first memorandum, please contact Raj Rao (rao.raj@epa.gov). Ifyou have questions regarding the modeling guidance in the second memorandum, please contact Tyler Fox (fox.tylerCfll,epa.gov). We are continuing our efforts to address permitting issues related to N02 and other NAAQS including the recently-signed I-hour sulfur dioxide NAAQS. We plan to issue additional guidance to address these new I-hour standards in the near future.

Attachments: I. Memorandum from Anna Marie Wood, Air Quality Policy Division, to EPA Regional Air Division Directors, "General Guidance for Implementing the I-hourN02 National Ambient Air Quality Standard in Prevention ofSignificantDeterioration Permits, Including an Interim I-hour N02Significant Impact Level" (June 28, 2010). 

### 2. Memorandum from Tyler Fox, Air Quality Modeling Group, to EPA Regional Air Division Directors, "Applicability ofAppendix W Modeling Guidance for the I-hour N02National Ambient Air Quality Standard" (June 28, 2010).

cc: Anna Marie Wood Richard Wayland Raj Rao Tyler Fox Dan deRoeck Roger Brode Rich Ossias Elliott Zenick Brian Doster



### 2UNITED STATES ENVIRONMENTAL PROTECTION AGENCY Office ofAirQualityPlanningand Standards Research Triangle Park, North Carolina 27711

June 28, 2010

MEMORANDUM

SUBJECT: General Guidance for Implementing the I-hourN02National Ambient Air Quality Standard in Prevention ofSignificantDeterioration Permits, Including an Interim I-hour N02 Significant Impact Level

FROM: Anna Marie Wood, Acting Director/s/ Air Quality Policy Division

TO: Regional Air Division Directors
INTRO])UCTION

We are issuing the following guidance to explain and clarify the procedures that may be followed by applicants for Prevention ofSignificant Deterioration (PSD) permits and permitting authorities reviewing such applications to properly demonstrate that proposed construction will not cause or contribute to a violation ofthe new I-hour nitrogen dioxide (N02) National Ambient Air Quality Standard (hereinafter, either the I-hourN02 NAAQS or I-hour N02 standard) that became effective on April 12,2010. EPA revised the primary N02 NAAQS by promulgating a I-hourN02NAAQS to provide the requisite protection ofpublic health. Under section I65(a)(3) ofthe Clean Air Act (the Act) and sections 52.21(k) and 51.166(k) ofEPA's PSD regulations, to obtain a permit, a source must demonstrate that its proposed emissions increase will not cause or contribute to a violation ofany NAAQS.

This guidance is intended to: (1) explain the recommended procedures for stakeholders to follow to properly address concerns over high preliminary modeled estimates ofambient N02 concentrations that suggestpotential violations ofthe new I-hour N02 standard under some modeling and permitting scenarios; (2) help reduce the burden ofmodeling for the hourly N02 standard where it can be properly demonstrated that a source will not have a significant impact
on ambient I-hour N02 concentrations; and (3) identify approaches that allow sources and permitting authorities to mitigate, in a manner consistent with existing regulatory requirements, potential modeled violations ofthe I-hourN02 NAAQS, where appropriate. Accordingly, the techniques described in this memorandum may be used by permit applicants and permitting authorities to configureprojects and permit conditions in orderto reasonably conclude that a proposed source's emissions do not cause or contribute to modeled I-hour N02NAAQS violations so that permits can be issued in accordance with the applicable PSD program requirements.

This guidance discusses existing provisions in EPA regulations and previous guidance for applying those provisions but focuses on the relevancy ofthis information for implementing the



### 3new NAAQS for N02

. Importantly, however, this guidance also sets forth a recommended interim I-hour N02 signifIcant impact level (SIL) that EPA will use for implementing the federal PSD program, and that states may choose to rely upon to implement their PSD programs for NOx ifthey agree that these values represent de minimis impact levels and incorporate into each permitrecord a rationale supporting this conclusion. This interim SIL is a useful screening tool that canbe used to determine whether or not the emissions from a proposed source will significantly impact hourly N02 concentrations, and, ifsignificant impacts are predicted to occur, whether the source's emissions "cause or contribute to" any modeled violations ofthe
new I-hour N02NAAQS.


### BACKGROUND

On April 12, 2010, the new I-hour N02NAAQS became effective. EPA interprets its regulations at 40 CFR 52.21 (the federal PSD program) to require permit applicants to demonstrate compliance with "any" NAAQS that is in effect on the date a PSD permit is issued. (See, e.g., EPA memo dated April I, 2010, titled "Applicability ofthe Federal Prevention of Significant Deterioration Permit Requirements to New and Revised National Ambient Air Quality Standards.") Due to the introduction ofa short-term averaging period for the I-hour N02NAAQS, we anticipate that some stationary sources with relatively short stacks may experience increased difficulty demonstrating that emissions from new construction or modifications will not cause or contribute to a violation ofthe I-hour N02NAAQS.

We are responding to reports from stakeholders which indicate that some sources, existing and proposed, are modeling high hourly N02concentrations showing violations ofthe 1- hour N02NAAQS-based only on the source's projected emissions ofNOx under some modeling and permitting scenarios. We find that, in many cases, the modeled violations are resulting from emissions at emergency electric generators and pump stations, where short stacks and limited property rights exist. In other cases, the problem may occur during periods ofunit stmlup, particularly where controls may initially not be in operation. Finally, certain larger sources, including coal-fired and natural gas-fired power plants, refineries, and paper mills could also experience problems in meeting the new I-hour N02NAAQS using particular modeling assumptions and permit conditions.

We believe that, in some instances, the projected violations result from the use of maximum modeled concentrations that do not adequately take into account the form ofthe 1- hour standard, and are based on the conservative assumption of 100%NOx-to-N02conversion in the ambient air. To the extentthat this is the case, it may be possible to providemore accurate projections ofambient N02 concentrations by applying currentprocedures which account for the statistical form ofthe I-hourN02 standard, as well as more realistic estimates ofthe rate of conversion ofNOx emissions to ambient N02 concentrations. See EPA Memorandum from Tyler Fox, Air Quality Modeling Group, to EPA Regional Air Division Directors, "Applicability ofAppendix W Modeling Guidance for the I-hour N02National Ambient Air Qnality Standard" (June 28, 2010) for specific modeling guidance for estimating ambient N02 concentrations consistent with the new I-hourN02NAAQS. In addition, where short stacks are currently being used, or are under design, it may be possible to lessen the source's air quality impacts without improper dispersion by implementing "good engineering practice" (GEP) stack heights to

4increase the height ofexisting or designed stacks to avoid excessive concentrations due to downwash, as described in the guidance below.
Itis EPA's expectationthat the guidance in this memorandum and available modeling guidance for N02 assist in resolving some ofthe issues arising from preliminary analyses that are reportedly showing potential exceedances ofthe new I-hour N02 NAAQS that would not be present under more refined modeling applications. In addition, the techniques described in this memorandum may also help avoid violations ofthe standard through design ofthe proposed
source or permit conditions, consistent with existing regulatory requirements, which enable the
source to demonstrate that its proposed emissions increase will not cause orcontribute to a modeled violation ofthe I-hour N02 standard. Moreover, the interim I-hourN02 SIL that is included in this guidance will provide a reasonable screening tool for efficiently implementing the PSD requirements for an air quality impact analysis.

The following discussion provides guidance concerning demonstrating compliance with the new NAAQS and mitigating modeled violations using air quality-based permit limits more stringent than what the BestAvailable Control Technology provisions may otherwiserequire, air quality offsets, the use ofGEl' stackheights, possiblepermitconditions for emergency generators, and an interim I-hourN02 SIL.
AIR-QUALITY BASED EMISSIONS LIMITATIONS

Once a level ofcontrol required by the Best Available Control Technology provisions is proposed by the pSD applicant, the proposed source's emissions mustbe modeled at the BACT emissions rate(s) to demonstrate that those emissions will not cause orcontribute to a violation ofany NAAQS or pSD increment. EPA's 1990 Workshop Manual (page B.54) describes circumstances where a source's emissions based on levels proposed through the top-down process may not be sufficiently controlledto prevent modeled violations ofan increment or NAAQS. In such cases, it may be appropriate for pSD applicants to propose a more stringent control option (that is, beyond the level identified via the top-down process) as a result ofan adverse impact on the NAAQS orpSD increments.

DEMONSTRATING COMPLIANCE WITH THE NEW NAAQS & MITIGATING MODELED VIOLATIONS WITH AIR QUALITY OFFSETS

A 1988 EPA memorandum provides procedures to follow when a modeled violation is identified during the PSD permitting process. See Memorandum from Gerald A. Emison, EPA OAQpS, to Thomas J. Maslany, EPA Air Management Division, "Air Quality Analysis for Prevention ofSignificant Deterioration (1'SD)." (July 5,1988). In brief: a reviewing authority may issue a proposed new source or modification a 1'SD permit only ifit can be shown that the proposed project's emissions will not "cause or contributeto" any modeled violations.

To clarify the above statement, in cases where modeled violations ofthe I-hour N02 NAAQS are predicted, but the permit applicant can showthat the NOx emissions increase from the proposed source will not have a significant impactat thepoint andtime of any modeled violation, the permitting authority has discretion to conclude that the source's emissions will not



### 5contribute to the modeled violation. As provided in the July 5, 1988, guidance memo, in such instances, because ofthe proposed source's de minimis contribution to any modeled violation, the source's impact will not be considered to cause or contribute to such modeled violations, and the permit could be issued. This concept continues to apply, and the significant impact level (described further below) may be used as part ofthis analysis. A 2006 decision by the EPA Environmental Appeals Board (EAB) provides detailed reasoning that demonstrates the permissibility offinding that a PSD source would not be considered to cause or contribute to a modeled NAAQS violation because its estimated air quality impact was insignificant at the time and place ofthe modeled violations 1 See In re Prairie State Gen. Co., 13 E.A.D.

__,_,PSD Appeal No. 05-05, Slip. Op. at 137-144 (EAB 2006)
However, where it is determined that a source's impact does cause or contribute to a modeled violation, apermit cannot be issued without some action taken to mitigate the source's impact. In accordance with 40 eFR 51.165(b)2, a major stationary source or major modification (as defined at §51.165(a)(1)(iv) and (v» that locates in an N02 attainment area, but would cause or contribute to a violation ofthe I-hourN02 NAAQS anywhere may "reduce the impact ofits emissions upon air quality by obtaining sufficient emission reductions to, at a minimum, compensate for its adverse ambient [N02 ] impact where the major source or major modification would otherwise cause or contribute to a violation

...." An applicant can meet this requirement for obtaining additional emissions reductions by either reducing its emissions at the source, e.g., promoting more efficient production methodologies and energy efficiency, or by obtaining air quality offsets (see below). See, e.g., In re Intel]Jower a/New York, Inc., 5 E.A.D. 130, 141 (EAB 1994)3 A State may also provide the necessary emissions reductions by imposing emissions limitations on other sources through an approved State Implementation Plan (SIP) revision. These approaches may also be combined as necessary to demonstrate that a source will not cause or contribute to a violation ofthe NAAQS.

Unlike emissions offsetrequirements in nonattainment areas, in addressing the air quality offset concept, it may not be necessary for apermit applicant to fully offset the proposed emissions increase ifan emissions reduction oflesser quantity will mitigate the adverse air quality impact on a modeled violation. ("Although full emission offsets are not required, such a source must obtain emission offsets sufficient to compensate for its air quality impact where the violation occurs." 44 FR 3274, January 16,1979, at 3278.) To clarify this, the 1988 guidance
memo referred to above states that:

offsets sufficient to compensate for the source's significant impact must be obtained pursuant to an approved State offset program consistent with State Implementation Plan (SIP) requirements under 40 eFR 51.165(b). Where the source is contributing to an

I While there is no I-hour NO, significant impact level (SIL) currently defined in the PSD regulations, we believe that states may adopt interim values, with the appropriatejustification for such values, to use for permitting purposes. In addition, we are recommending an interim SIL as part ofthis guidance for implementing the NO, requirements in the federal PSD program, and in state programs where states choose to use it.
2 The same provision is contained in EPA's Interpretative Ruling at 40 eFRpart 51 Appendix S, section 1Il.
J In contrast to Nonattainment New Source Review permits, offsets are not mandatory requirements in PSD permits ifit can otherwise be demonstrated that a source will not cause or contribute to a violation ofthe NAAQS. See, In
re Knauf Fiber Giass, GMBH, 8 E.A.D. 121, 168 (EAB 1999).

6existing violation, the required offset may not correct the violation. Such existing violations must be addressed [through the SIP].



### In addition, in orderto determine the appropriate emissions reductions, the applicant and permitting authority should take into account modeling procedures for the form ofthe I-hour standard and for the appropriate NOx-N02 conversionrate that applies in the area ofconcern. As pati ofthis process, existing ambient ozone concentrations and other meteorological conditions in the area ofconcern may need to be considered. Note that additional guidance for this and other aspects ofthe modeling analysis for the impacts ofNOx emissions on ambient concentrations ofN02 are addressed in EPA modeling guidance, including the June 28, 2010, Memorandum titled, "Applicability ofAppendix W Modeling Guidance for the I-hourN02 National Ambient Air Quality Standard."

"GOOD ENGINEERING PRACTICE" STACK HEIGHT & DISPERSION TECHNIQUES

Ifa permit applicant is unable to show that the source's proposed emissions increase will not cause or contribute to a modeled violation ofthe new I-hour N02NAAQS, the problem could be the result ofplume downwash effects which may cause high ambient concentrations
near the source. 

### In such cases, a source may be able to raise the height ofits existing stacks (or designed stacks ifnot yet constructed) to a GEP stack height ofat least 65 meters, measured li'om the ground-level elevation at the base ofthe stacie

While not necessarily totally eliminating the effects ofdownwash in all cases, raising stacks to GEP height may provide substantial air quality benefits in a manner consistent with statutory provisions (section 123 ofthe Act) governing acceptable stackheights to minimize extensive concentrations due to atmospheric downwash, eddies or wakes. Permit applicants should also be aware ofthe regulatory restrictions on stack heights for the purpose ofmodeling for compliance with NAAQS and increments. Section 52.21(h) ofthe PSI) regulations currently prohibits the use ofdispersion techniques, such as stack heights above GEP, merged gas streams,
or intermittent controls for setting NOx emissions limits orto meetthe annual and I-hour NAAQS and annual N02 increments. However, stack heights in existence before December 31, 1970, and dispersion techniques implemented before then, are not affected by these limitations. EPA's general stack height regulations are promulgated at 40 CFR 51.1OO(ff), (gg), (hh), (ii), 

### @, (kk) and (nn), and 40 CFR 51.118.

a. Stack heights: A source cannot take credit for that portion ofa stack height in excess ofthe GEP height when modeling to develop the NOx emissions limitations or to determine
source compliance with the annual and I-hour N02 NAAQS. It should be noted, however, that this limitation does not limit the actual height ofany stack constructed by a new source or modification.

The following limitations apply in accordance with §52.21(h):
• For a stack height less than GEP, the actual stack height must be used in the source impact analysis for NOx emissions;

7• For a stack height equal to or greater than 65 meters, the impact on NOx emission limits may be modeled using the greater of: o A de minimis stack height equal to 65 meters, as measured from the groundlevel elevation at the base ofthe stack, without demonstration or calculation (40 eFR 51.1OO(ii)(1»; o The refined formula height calculated using the dimensions ofnearby structures in accordance with the following equation:
GEl)

## =H 

### + 1.5L, where H is the height ofthe nearby structure and L is the lesser dimension ofthe height or projected width ofthe nearby structure (40 eFR 51.100(ii)(2)(ii».4

• A GEP stack height exceeding the refined formula height may be approved when it
can be demonstrated to be necessary to avoid "excessive concentrations" ofN02 caused by atmospheric downwash, wakes, oreddy effects by the source, nearby structures, or nearby terrain features. (40 eFR 51.l00(ii)(3), (jj), (kk»;

• For purposes ofPSD (and NOx/N02), "excessive concentrations" means a maximum ground-level concentration ofN02 due to NOx emissions from a stack due in whole
or in part to downwash, wakes, and eddy effects produced by nearby structures or nearby terrain features which individually is at least 40 percent in excess ofthe maximum N02concentration experienced in the absence ofsuch effects and (a) which contributes to a total N02concentration due to emissions from all sources that is greater than the annual or I-hourN02NAAQS or (b) greater than the PSD (annual) increment for N02
. (40 eFR 51.100(kk)(I». Reportedly, for economic and otherreasons, many existing source stacks have been constructed at heights less than 65 meters, and source impact analyses may show that the source's emissions will cause or contribute to a modeled violation ofthe annual or I-hourN02 NAAQS. Where this is the case, sources should be aware that they can increase their stack heights up to 65 meters without a GEP demonstration.

b. Other dispersion techniques: The term "dispersiontechnique" includes any practice carried outto increase final plumerise, subject to certain exceptions (40 eFR 51.IOO(hh)(I)(iii), (2)(i)

- (v». Beyond the noted exceptions, such techniques are not allowed for getting credit for modeling source compliance with the annual and I-hour N02 NAAQS and annual N02 increment.

4 For stacks in existence on January 12, 1979, the GEl' equation is GEl'

- 2.5 H (provided the owner or operator produces evidence that this equation was actually relied on in establishing an emission limitation for NOx (40 CFR 51.100(ii)(2)(i)

8OPERATION OF EMERGENCY EQUIPMENT & GENERAL STARTUP CONDITIONS

In determining an emergency generator's potential to emit, existing guidance (EPA
memo titled "Calculating Potential to Emit (PTE) for Emergency Generators," September 6, 1995) allows a default value of500 hours "forestimating the number ofhours that an emergency generator could be expected to operate under worst-case conditions." The guidance also allows for alternative estimates to be made on a case-by-case basis for individual emergency generators. This time period must also consider operating time for both testing/maintenance as well as for emergency utilization. Likewisc, existing EPA policy does not allow NOx emissions to be excluded from the source impact analysis (NAAQS and increments) when the emergency equipment is operating during an emergency. EPA provides no exemption from compliance with the NAAQS during periods ofemergency operation. Thus, it is not sufficientto consider only emissions generated during periods oftesting/maintenance in the source impact analysis.

Ifduring an emergency, emergency equipment is never operated simultaneously with other emissions units at the source that the emergency equipment will back up, a worst-case hourly impact analysis may very well occur during periods ofnormal source operation when other emissions units at the facility are likely to be operating simultaneously with the scheduled testing ofemergency equipment. To avoid such worst-case modeling situations, a permit applicant may commit to schedulingthe testing ofemergency equipment duringtimes when the
source is not otherwise operating, or during known off-peak operating periods. This could provide a basis tojustify not modeling the I-hour impacts ofthe emergency equipment under conditions that would include simultaneous operation with other onsite emissions units. Accordingly, permits for emergency equipment may include enforceable conditions that specifically limitthe testing/maintenance ofemergency equipmentto certain periods oftime (seasons, days ofthe week, hours ofthe day, etc.) as long as these limitations do not constitute dispersion techniques under 40 CFR 51.1(hh)(l)(ii).

We also note that similar problems associated with the modeling ofhigh I-hour N02 concentrations have been reported to occur during startup periods for certain kinds ofemissions units--often because control equipment cannot function during all or a portion ofthe stm1up process. EPA currently has no provisions for exempting emissions occurring during equipment startups fl'om the air quality analysis to demonstrate compliance with the NAAQS. Startup emissions may occur during only a relatively small portion ofthe unit's total annual operating schedule; however, they must be included in the required PS]) air quality analysis for the NAAQS. Sources may be willing to accept enforceable permit conditions limiting equipment startups to certain hours ofthe day when impacts are expected to be lower than normal. Such permit limitations can be accounted for in the modeling ofsuch emissions. Applicants should direct other questions arising concerningprocedures for modeling startup emissions to the applicable permitting authority to determine the most current modeling guidance.

9SCREENING VALUES

In the final rule establishing the hourly N02standard, EPA discussed various implementation considerations for the PSD permitting program. 75 FR.6474, 6524 (Feb. 9, 20I0). This discussion included the following statements regarding particular screening values that have historically beenused on a widespread basis to facilitate implementation ofthe PSD permitting program:
We also believethat there may be a need to revise the screening tools currently used under the NSRlPSD program for completing N02analyses. These screening tools include the significant impact levels (SILs), as mentioned by one commenter, but also include the significant emissions rate for emissions ofNOx and the significant monitoring concentration (SMC) for N02

. EPA intends to evaluate the need for possible changes or additions to each ofthese important screening tools for NOx/N02 due to the addition ofa I-hourN02NAAQS. Ifchanges or additions are deemed necessary, EPA will propose any such changes for public notice and comment in a separate action. 75 FR 6525.

EPA intends to conduct an evaluation ofthese issues and submit ourfindings in the form ofrevised significance levels under notice and commentrulemaking ifany revisions are deemed appropriate. In the interim, for the reasons provided below, we recommend the continued use of the existing significant emissions rates (SER) for NOx emissions as well as an interim I-hour NO

### zSIL that we are setting forth today for conducting air quality impact analyses for the I-hour N02NAAQS. As described in the section titled Introduction, EPA intends to implement the interim I-hour NO

### zSIL contained herein under the federal PSD program and offers states the opportunity to use it in their PSD programs ifthey choose to do so. EPA is not addressing the signifIcant monitoring concentrations in this memorandum.

SIGNIFICANT EMISSIONS RATE

Under the terms ofexisting EPA regulations, the applicable signifIcant emissions rate for nitrogen oxides is 40 tons per year. 40 CFR 52.21(b)(23); 40 CFR 51.166(b)(23). The signifIcant emissions rates defIned in those regulations are specific to individual pollutants but
are not differentiated by the averaging times ofthe air quality standards applicable to some ofthe listed pollutants. Although EPA has not previously promulgated a N02 standard using an averaging time ofless than one year, the NAAQS for S02 have included standards with 3-hour and 24-hour averaging times for many years. EPA has applied the 40 tons per year significant emissions rate for S02 across all ofthese averaging times. Until the evaluation described above and any associated rulemaking is completed, EPA does not believe it has cause to apply the NO

### z significant emissions rate any differently than EPA has historically applied the S02 signifIcant emissions rate and others that apply to standards with averaging times less than I year.
Under existing regulations, an ambient air quality impact analysis is required for "each pollutant that [a source] would have the potential to emit in signifIcant amounts." 40 CFR 52.21(m)(1)(i)(a); 40 CFR. 51.166(m)(1)(i)(a). For modifications, these regulations require this analysis for "each pollutant for which [the modification] would result in a signifIcant net

10emissions increase." 40 CFR.S2.21(m)(l)(i)(b); 40 CFR.SJ.J66(m)(l)(i)(b). EPA construes this regulation to mean that an ambient impact analysis is not necessary for pollutants with emissions rates below the significant emissions rates in paragraph (b)(23) ofthe regulations. No additional action by EPA orpermitting authorities is necessary at this time to apply the 40 tpy significant emissions rate in existing regulations to the hourly N02 standard.

INTERIM I-HOUR N02 SIGNIFICANT IMPACT LEVEL

A significant impact level (SIL) serves as a useful screening tool for implementing the PSD requirements for an air quality analysis. The primary purpose ofthe SIL is to serve as a screening tool to identify a level ofambient impact that is sufficiently lowrelative to the NAAQS or PSD increments such that the impact can be considered trivial orde minimis. Hence, the EPA considers a source whose individual impact falls below a SIL to have a de minimis impact on air quality concentrations that already exist. Accordingly, a source that demonstrates that the projected ambient impact ofits proposed emissions increase does not exceed the SIL for that pollutant at a location where a NAAQS or increment violation occurs is not considered to
cause or contribute to that violation. In the same way, a source with a proposed emissions increase ofa particularpollutantthat will have a significant impact at some locations is not required to model at distances beyond the point where the impact ofits proposed emissions is below the SILs for that pollutant. When a proposed source's impact by itselfis not considered to be "significant," EPA has long maintained that any further effort on the part ofthe applicant to complete a cumulative source impact analysis involving other source impacts would only yield information oftrivial or no value with respect to the required evaluation ofthe proposed source or modification. The concept ofa SIL is grounded on the de minimisprinciples described by the court inAlabamaPower Co. v. CosrIe, 636 F.2d 323, 360 (D.C. Cir. 1980); See also Sur Contra La Contaminacion v. EPA, 202 FJd443, 448-49 (Ist Cir. 2000) (upholding EPA's use ofSIL to allow permit applicant to avoid full impact analysis); 

### In re: Prairie State Gen. Co., PSD Appeal No. 

### OS-OS, Slip. Op. at 139 (EAB 2006)

EPA has codified several SILs into regulations at 40 CFR 5I.I65(b). EPA plans to undertake rulemaking to develop a I-hour N02 SIL for the new NAAQS for N02
. However, EPA has recognized that the absence ofan EPA-promulgated SIL does not preclude permitting authorities from developing interim SILs for use in demonstrating that a cumulative air quality analysis would yield trivial gain. Response to Comments, Implementation ofNew Source Review (NSR) Program for Particulate Matter Less Than 2.5 Micrometers in Diameter (PM25), pg. 82 (March 2008) [EPA-HQ-OAR-2003-0062-0278J.

Until such time as a I-hour N02 SIL is defined in the PSD regulations, we are herein providing a recommended interim SIL that we intend to use as a screening tool for completing the required air quality analyses for the new I-hour N02 under the federal PSD program at 40 CFR 52.21. To support the application ofthis interim SIL in each instance, a permitting authority that utilizes this SIL as part ofan ambient air quality analysis should include in the permit record the analysis reflected in this memorandum and the referenced documents to demonstrate that an air quality impact at orbelow the SIL is de minimis in nature and would not
cause a violation ofthe NAAQS.

I IUsing the interim I-hourN02SIL, the permit applicant and permitting authority can determine: (I) whether, based on the proposed increase in NOx emissions, a cumulative air quality analysis is required; (2) the area ofimpact within which a cumulative air quality analysis should focus; and (3) whether, as part ofa cumulative air quality analysis, the proposed source's NOx emissions will cause or contribute to a modeled violation ofthe I-hour N02NAAQS.

In this guidance, EPA recommends an interim I-hour N02SIL value of4 ppb. To determine initially whether aproposed project's emissions increase will have a significant impact (resulting in the need for a cumulative air quality analysis), this interim SIL should be compared to either ofthe following:

• The highest ofthe 5-year averages ofthe maximum modeled I-hour N02 concentrations predicted each year at each receptor, based on 5 years ofNational Weather Service data; or
• The highest modeled I-hour N02 concentration predicted across all receptors based
on I year ofsite-specific meteorological data, or the highest ofthe multi-year averages ofthe maximum modeled I-hour N02 concentrations predicted each year at each receptor, based on 2 ormore, up to 5 complete years ofavailable site-specific meteorological data.

Additional guidance will be forthcoming for the purpose ofcomparing aproposed source's modeled impacts to the interim I-hourN02SIL in order to make a determination about whether that source's contribution is significant when a cumulative air quality analysis identifies violations ofthe I-hour N02NAAQS (i.e., "causes or contributes to" a modeled violation).

We derived this interim I-hour N02SIL by using an impact equal to 4% ofthe I-hour N02NAAQS (which is 100 ppb). We have chosen this approach because we believe it is reasonable to base the interim I-hour N02SIL directly on consideration ofimpacts relative to the I-hourN02NAAQS. In 1980, we defined SERfor each pollutant subject to PSD. 45 FR 52676, August 7,1980 at 52705-52710. For PM and S02, we defined the SER as the emissions rate that resulted in an ambient impact equal to 4% ofthe applicable short-term NAAQS. The 1980 analysis focused on levels no higher than 5% ofthe primary standard because ofconcerns that higher levels were found to result in unreasonably large amounts ofincrement being consumed by a single source. Within the range ofimpacts analyzed, we considered two factors that had an important influence on the choice ofde minimis emissions levels: (I) cumulative effect on increment consumption ofmultiple sources in an area, each making the maximum de minimis emissions increase; and (2) the projected consequence ofa given de minimis level on administrative burden. As explained in the preamble to the 1980 rulemaking and the supporting documentation,5 EPA decided to use 4% ofthe 24-hourprimary NAAQS for PM and S02 to define the significant emissions rates (SERs) for those pollutants. Itwas noted that, at the time, only an annual N02 NAAQS existed. Thus, for reasons explained in the 1980 preamble, to define the SER for NOx emissions we used a design value of2% ofthe annual N02NAAQS. See 45 FR 52708. Looking now at a short-term NAAQS for N02 ,we believe that it is reasonable as an interim approach to use a SIL value that represents 4% ofthe I-hour N02

5 EPA evaluated de minimis levels for pollutants for which NAAQS had been established in a document titled "Impact ofProposed and Alternative De Minimis Levels for Criteria Pollutants"; EPA-4S012-80-0n, June 1980.

12NAAQS. EPA will consider otherpossible alternatives for developing a I-hour N02 SIL in a future rulemaking that will provide an opportunity for public participation in the development of
a SIL as part ofthe PSD regulations.

Several state programs have already adopted interim I-hour N02 SILs that differ (both higher and lower) from the interim value being recommended herein. The EPA-recommended interim I-hour N02 SIL is not intended to supersede any interim SIL that is now or may be relied upon to implement a state PSD program that is part ofan approved SIP, or to impose the use of the SIL concept on any state that chooses to implement the PSD program-inparticular the ambient air quality analysis-without using a SIL as a screening tool. Accordingly, states that implement the PSD program under an EPA-approved SIP may choose to use this interim SIL, another value that may be deemed more appropriate for PSD permittingpurposes in the state of concern, orno SIL at all. The application ofany SIL that is not reflected in apromulgated regulation should be supported by arecord in each instance that shows the value represents a de minimis impact on the I-hour N02 standard, as described above.

In the event ofquestions regarding the general implementation guidance contained iu this memorandum, please contact Raj Rao (rao.raj@epa.gov).

cc: Raj Rao, C504-0I Dan deRoeck, C504-03 TylerFox, C439-01 Roger Brode, C439-01 Richard Wayland, C304-02 Elliot Zenick, OGC Brian Doster, OGC EPA Regional NSR Contacts

13UNITED STATES ENVIRONMENTAL PROTECTIONAGENCY 

### Office ofAir Quality Planning and Standards Research TrianglePark, North Carolina 27711

June 28, 2010

MEMORANDUM

SUBJECT: Applicability ofAppendix W Modeling Guidance for the I-hour N02 National Ambient Air Quality Standard

FROM: Tyler Fox, Leader Air Quality Modeling Group, C439-01

TO: Regional Air Division Directors

INTRODUCTION

On January 22, 2010, EPA announced a new I-hour nitrogen dioxide (N02 ) National Ambient Air Quality Standard (I-hourN02 NAAQS or I-hour N02 standard) which is attained when the 3-year average ofthe 98th-percentile ofthe annual distribution ofdaily maximum I-hour concentrations does not exceed 100 ppb at each monitor within an area. The final rule for the new I-hour N02NAAQS was published in the Federal Register on February 9, 2010 (75 FR 6474-6537), and the standard became effective on April 12, 2010 (EPA, 2010a). This memorandum clarifies the applicability ofcurrent guidance in the Guideline onAir Quality Models (40 CFR Part 51, Appendix W) for modeling N02 impacts in accordance with the Prevention ofSignificant Deterioration (PSD) permit requirements to demonstrate compliance with the new I-hour N02 standard.

SUMMARY OF CURRENT GUIDANCE

While the new I-hourNAAQS is defined relative to ambient concentrations ofN02, the majority ofnitrogen oxides (NOx) emissions for stationary and mobile sources are in the form of nitric oxide (NO) rather thanN02
. Appendix W notes that the impact ofan individual source on ambient N02depends, in part, "onthe chemical environment into which the source'splume is to be emitted" (see Section 5.1.j). Given the role ofNOx chemistry in determining ambient impact levels ofN02based on modeled NOx emissions, Section 5.2.4 ofAppendix W recommends the following three-tiered screening approach for N02modeling for annual averages:

• Tier I

- assume full conversion ofNO to N02 based on application ofan appropriate refined modeling technique under Section 4.2.2 ofAppendix W to estimate ambient NOx concentrations;
• Tier 2

- multiply Tier I result by empirically-derived N02/NOx ratio, with 0.75 as the annual national default ratio (Chu and Meyer, 1991); and

14• Tier 3

- detailed screening methods may be considered on a case-by-case basis, with the Ozone Limiting Method (OLM) identified as a detailed screening technique for point
sources (Cole and Summerhays, 1979).

Tier 2 is often referred to as the Ambient Ratio Method, or ARM. Site-specific ambient N02INOxratios derived from appropriate ambient monitoring data may also be considered as detailed screening methods on a case-by-case basis, with properjustification. Consistent with Section4.2.2, AERMOD is the currentpreferred model for "a widerange ofregulatory applications in all types ofterrain" for purposes ofestimating ambientconcentrations ofNOz , based on NOx emissions, underTiers I and 2 above. We discuss the role ofAERMOD for Tier 3 applications in more detail below.


### APPLICABILITY OF CURRENT GUIDANCE TO I-HOURN02 

### NAAQS

In general, the Appendix W recommendations regarding the annual N02standard are also applicable to the new I-hourN02 standard, but additional issues may need to be considered in the context ofa I-hour standard, depending on the characteristics ofthe emission sources, and depending on which tier is used, as summarized below:

• Tier I applies to the I-hourN02 standard without any additionaljustification;

• Tier 2 may also apply to the I-hourN02 standard in many cases, but some additional consideration will be needed in relation to an appropriate ambient ratio for peak hourly impacts since the current default ambientratio is considered to be representative of"area wide quasi-equilibrium conditions"; and

• Tier 3 "detailed screening methods" will continue to be considered on a case-by-case basis for the I-hourN02standard. However, certain input datarequirements and assumptions for Tier 

### 3 applications may be ofgreaterimportance for the I-hour standard than for the annual standard given the more localized nature ofpeak hourly vs. annual impacts. In addition, use ofsite-specific ambient N02INOxratios based on ambient monitoring data will generally be more difficult tojustify for the I-hourN02 standard than for the annual standard.

While Appendix W specifically mentions OLM as a detailed screening method under Tier 

### 3, we also considerthe Plume Volume Molar Ratio Method (PVMRM) (Hanrahan, 1999a) discussed under Section 5.1.j ofAppendix W to be in this category at this time. Both ofthese options account for ambient conversion ofNO to N02 in the presence ofozone, based onthe following basic chemical mechanism, known as titration, although there are important differences betweenthese methods:
(Eq. I)

As noted in Section 5.1.j, EPA is currentlytesting the PVMRM optionto determine its suitability
as a refined method. Limited evaluations ofPVMRM have been completed, which show encouraging results, but the amount ofdata currently available is too limited tojustify a designation ofPVMRM as a refined method for N02 (Hanrahan, 1999b; MACTEC, 2005). EPA is currently updating and extendingthese evaluations to examine model performance for

ISpredicting hourly N02concentrations, including both the OLM and PVMRM options, and results ofthese additional evaluations will be provided at a later date. A sensitivity analysis ofthe OLM and PVMRM options in AERMOD has been conducted that compares modeled concentrations based on OLM and PVMRM with Tiers 1and 2 for a range ofsource characteristics (MACTEC, 2004). This analysis serves as a useful reference to understand how ambient N02concentrations may be impacted by application ofthis three-tiered screening approach, and includes comparisons for both annual average and maximum I-hourN02concentrations.
Key model inputs for both the OLM and PVMRM options are the in-stack ratios of N02/NOx emissions and background ozone concentrations. While the representativeness of these key inputs is important in the context ofthe annual N02 standard, they will generally take
on even greater importance for the new I-hour N02 standard, as explained in more detail below. Recognizing the potential importance ofthe in-stack N02/NOx ratio for hourly N02compliance demonstrations, we recommend that in-stack ratios used with either the OLM or PVMRM options bejustified based on the specific application, i.e., there is no "default" in-stack N02INOx ratio for either OLM or PVMRM.

The OLM and PVMRM methods are both available as non-regulatory-default options within the EPA-preferred AERMOD dispersion model (Cimorelli, el aI., 2004; EPA, 2004; EPA, 2009). As a result oftheir non-regulatory-default status, pursuant to Sections 3.1.2.c, 3.2.2.a, and A.l.a(2) ofAppendix W, application ofAERMOD with the OLM or PVMRM option is no longer considered a "preferred model" and, therefore, requiresjustification and approval by the Regional Office on a case-by-case basis. While EPA is continuing to evaluate the PVMRM and OLM options within AERMOD for use in compliance demonstrations for the I-hourN02 standard, as long as they are considered to be non-regulatory-default options, their use as alternative modeling techniques under Appendix W should bejustified in accordance with Section 3.2.2, paragraph (e), as follows:

"e. Finally, for condition (3) in paragraph (b) ofthis subsection [preferred model is less appropriate for the specific application, orthere is no preferred model], an alternative refined model may be used provided that:

I. The model has received a scientifIC peerreview;
11. The model can be demonstrated to be applicable to the problem on a theoretical basis;
111. The data bases which are necessary to perform the analysis are available and adequate;
IV. Appropriate performance evaluations ofthe model have shown that the model is not biased toward underestimates; and
v. A protocol on methods and procedures to be followed has been established."

Since AERMOD is the preferred model for dispersion for a wide range ofapplication, the focus ofthe alternative model demonstration for use ofthe OLM and PVMRM options within AERMOD is on the treatment ofNOx chemistry within the model, and does not need to address basic dispersion algorithms within AERMOD. Furthermore, items i and iv ofthe alternative



### 16model demonstration for these options canbe fulfilled in part based on existing documentation (Cole and Summerhays, 1979; Hanrahan, 1999a; Hanrahan, 1999b; MACTEC, 200S), and the remaining items should be routinely addressed as part ofthe modeling protocol, irrespective of the regulatory status ofthese options. The issue ofapplicability to the problem on a theoretical basis (item ii) is a case-by-case determination based on an assessment ofthe adequacy ofthe
ozone titration mechanism utilized by these options to account for NOx chemistry within the AERMOD model based on "the chemical environment into which the source's plume is to be emitted" (Appendix W, Section S.I.j). The adequacy ofavailable data bases needed for application ofOLM and PVMRM (item iii), including in-stack N02/NOx ratios and background
ozone concentrations, is a critical aspect ofthe dcmonstration which we discuss in more detail below. It should also be noted that application ofthe OLM or PVMRM methods with other Appendix W models or alternative models, whether as a separate post-processor or integrated within the model, would require additional documentation and demonstration that the methods have been implemented and applied appropriately within that context, including model-specific performance evaluations which satisfy item iv under Section 3.2.2.e.

Given the form ofthe new I-hour N02standard, some clarification is needed regarding the appropriate data periods for modeling demonstrations ofcompliance with thc NAAQS vs. dcmonstrations ofattainment ofthe NAAQS through ambient monitoring. While monitored design values for the I-hourN02 standard are based on a 3-year average (in accordance with Section 1 (c)(2) ofAppendix Sto 40 CFR Part SO), Section 8.3.1.2 ofAppendix W addresses the length ofthe meteorological data record for dispersion modeling, stating that "[T]he use ofS years ofNWS [National Weather Service] meteorological data or at least 1year ofsite specific data is required." Section 8.3.1.2.b further states that "one year or more (including partial years), up to five years, ofsite specific data

... are preferred for use in air quality analyses." Although the monitored design value for the I-hourN02standard is defined in terms ofthe 3-year average, this definition does not preempt or alter the Appendix W requirement for use ofSyears ofNWS meteorological data or at least 1year ofsite specific data. The S-year average based on use of NWS data, or an average across one ormore years ofavailable site specific data, serves as an unbiased estimate ofthe 3-year average for purposes ofmodeling demonstrations ofcompliance with the NAAQS. Modeling of"rolling 3-year averages," using years 1through 3, years 2 through 4, and years 3 through 5, is not required. Furthermore, since modeled results for N02
are averaged across the number ofyears modeled for comparison to the new I-hourN02 standard, the meteorological data period should include complete years ofdata to avoid introducing a seasonal bias to the averaged impacts. In order to comply with Appendix W recommendations in cases where partial years ofsite specific meteorological data are available, while avoiding any seasonal bias in the averaged impacts, an approach that utilizes the most conservative modeling result based on the first complete-yearperiod ofthe available data record
vs. results based on the last complete-yearperiod ofavailable data may be appropriate, subjectto approval by the appropriate reviewing authority. Such an approach would ensure that all available site specific data are accounted for in the modeling analysis without imposing an undue burden on the applicant and avoiding arbitrary choices in the selection ofa single complete-year data period.

The form ofthe new I-hour N02standard also has implications regarding appropriate methods for combining modeled ambient concentrations with monitored background

17concentrations for comparisonto the NAAQS in a cumulative modeling analysis. As noted in the March 23, 2010 memorandum regarding "Modeling Procedures for Demonstrating Compliance with PM25 NAAQS" (EPA, 201Ob), combining the 98th percentile monitored value with the 98th percentile modeled concentrations for a cumulative impact assessment could result in a value that is belowthe 98th percentile ofthe combined cumulative distribution and would, therefore, notbe protective ofthe NAAQS. However, unlike the recommendations presented for PM2S, the modeled contributionto the cumulative ambient impact assessmentfor the I-hourN02 standard should follow the form ofthe standard based onthe 98th percentile ofthe annual distribution ofdaily maximum I-hour concentrations averaged across the number ofyears modeled. A "first tier" assumption that may be applied without furtherjustification is to add the overall highest hourly background N02concentration from a representative monitor to the modeled design value, based on the form ofthe standard, for comparison to the NAAQS. Additional refinements to this "firsttier" approach based on some level oftemporal pairing of modeled and monitored values may be considered on a case-by-case basis, with adequate justification and documentation.

DISCUSSION OF TECHNICAL ISSUES

While many ofthe same technical issues related to application ofAppendix W guidance for an annual N02 standard would also apply in the context ofthe new I-hourN02 standard, there are some important differences that may also need to be considered depending on the specific application. This section discusses several aspects ofthese technical issues related to the
new I-hour N02 NAAQS, including a discussion ofsource emission inventories required for modeling demonstrations ofcompliance with the NAAQS and other issues specific to each ofthe three tiers identified in Section 5.2.4 ofAppendix W for N02 modeling.

Emission Inventories

The source emissions data are a key input for allmodcling analyses and one that may require additional considerations under the new I-hourN02standard is the source emissions data. Section 8.1 ofAppendix W provides guidance regarding source emission input data for dispersion modeling and Table 8-2 summarizes the recommendations for emission input data that should be followed for NAAQS compliance demonstrations. Although existing NOx emission inventories used to support modeling for compliance with the annual N02 standard should serve as a useful starting point, such inventories may not always be adequate for use in assessing compliance with the new I-hourN02 standard since some aspects ofthe guidance in Section 8.1 differs for long-term (annual and qumierly) standards vs. short-term (:s: 24 hours) standards. In particular, since maximum ground-level concentrations may be more sensitive to operating levels and startup/shutdown conditions for an hourly standard than for an annual standard, emission rates and stack parameters associated with the maximum ground-level concentrations for the annual standard may underestimate maximum concentrations for the new I-hour N02standard. Due to the importance ofin-stack N02 /NOx ratios required for application ofthe 

### OLM and PVMRM options within AERMOD discussed above, consideration should also be given to the potential variability ofin-stack N02/NOx ratios under different operating conditions when those non-regulatory-default options are applied. We also note that source emission input data recommendations in Table 8-2 ofAppendix W for "nearby sources" and "other sources"that

18may be needed to conduct a cumulative impact assessment include further differences between emission data for long-term vs. short-term standards which could also affect the adequacy of existing annual NOx emission inventories for the new I-hour N02 standard. The terms "nearby sources" and "other sources" used in this context are defined in Section 8.2.3 ofAppendix W. Attachment A provides a more detailed discussion on determining NOx emissions for permit modeling.

While Section 8.2.3 ofAppendix W emphasizes the importance ofprofessionaljudgment by the reviewing authority in the identification ofnearby and other sources to be included in the modeled emission inventory, Appendix W establishes "a significant concentration gradient in the vicinity ofthe source" under consideration as the main criterion for this selection. Appendix W also indicates that "the number ofsuch [nearby] sources is expected to be small except in unusual situations." See Section 8.2.3.b. Since concentration gradients will vary somewhat depending on the averaging period being modeled, especially for an annual vs. I-hour standard, the criteria for selection of"nearby" and "other" sources for inclusion in the modeled inventory may need to be reassessed for the I-hourN02 standard.

The representativeness ofavailable ambient air quality data also plays an important role in determining which nearby sources should be included in the modeled emission inventory. Key issues to consider in this regard are the extent to which ambient air impacts ofemissions from nearby sources are reflected inthe available ambient measurements, and the degree to which emissions from those background sources during the monitoring period are representative ofallowable emission levels under the existingpermits. The professionaljudgmentsthat are required in developing an appropriate inventory ofbackground sources should strive toward the proper balance between adequately characterizing the potential for cumulative impacts of emission sources within the study area to cause or contribute to violations ofthe NAAQS, while minimizing the potential to overestimate impacts by double-counting ofmodeled source impacts that are also reflected in the ambient monitoring data. We would also caution against the literal and uncritical application ofvery prescriptive procedures for identifying which background sources should be included in the modeled emission inventory for NAAQS compliance demonstrations, such as those described in Chapter C, Section IV.C.l ofthe draft New Source Review WorhhojJ Manual (EPA, 1990), noting again that Appendix W emphasizes the importance ofprofessionaljudgmentin this process. While the draft workshop manual serves as a useful general reference regarding New Source Review (NSR) and PSD programs, and such procedures may playa useful role in defining the spatial extent ofsources whose emissions may need to be considered, it should berecognized that "[iJt is not intended to be an official statement ofpolicy and standards and does not establish binding regulatory requirements." See, Preface.

Given the range ofissues involved in the determination ofan appropriate inventory of emissions to include in a cumulative impact assessment, the appropriate reviewing authority should be consulted early in the process regarding the selection and proper application of appropriate monitored background concentrations and the selection and appropriate characterization ofmodeled background source emission inventories for use in demonstrating compliance with the new I-hourN02 standard. Tier-specific Technical Issues



### 19This section discusses technical issues related to application ofeach tier in the threetiered screening approach for N02modeling recommended in Section 5.2.4 Appendix W. A basic understanding ofNOx chemistry and "ofthe chemical environment into which the source's plume is to be emitted" (Appendix W, Section 5.1.j) will be helpful for addressing these issues based on the specific application.

Tier I:

Since the assumption offull conversion ofNO to N02 will provide the most conservative treatment ofNOx chemistry in assessing ambient impacts, there are no technical issues associated with treatment ofNOx chemistry for this tier. However, the general issues related to emission inventories for the I-hourN02 standard discussed above and in Attachment A apply to Tier I.

Tier 2:

As noted above, the 0.75 national default ratio for ARM is considered to be representative of"areawide quasi-equilibrium conditions" and, therefore, may not be as appropriate for use with the I-hour N02 standard. The appropriateness ofthis default ambient ratio will depend somewhat on the characteristics ofthe sources, and as such application ofTier 2 for I-hour N02 compliance demonstrations may need to be considered on a source-by-source basis in some cases. The key technical issue to address in relation to this tier requires an understanding ofthe meteorological conditions that are likely to be associated with peakhourly impacts hom the source(s) being modeled. In general, for low-level releases with limited plume rise, peak hourly NOx impacts are likely to be associated with nighttime stable/light wind conditions. Since ambient ozone concentrations are likely to berelatively low for these conditions, and since low wind speeds and stable atmospheric conditions will further limit the conversion ofNO to N02 by limiting the rate ofentrainment ofozone into the plume, the 0.75 national default ratio will likely be conservative for these cases. A similarrationale may apply for elevated sources where plume impaction on nearby complex terrain under stable atmospheric conditions is expected to determine the peak hourly NOx concentrations. By contrast, for elevated sources in relatively Hat terrain, the peak hourly NOx concentrations are likely to occur during daytime convective conditions, when ambient ozone concentrations are likely to be relatively high and entrainment ofozone within the plume is more rapid due to the vigorous vertical mixing during such conditions. Forthese sources, the 0.75 default ratio may not be conservative, and some caution may be needed in applying Tier 2 for such sources. We also note that the default equilibrium ratio employed within the PVMRM algorithm as an upper bound on an hourly basis is 0.9.

Tier 3:

This tier represents a general category of"detailed screening methods" which may be considered on a case-by-case basis. Section 5.2.4(b) ofAppendix W cites two specific examples ofTier 

### 3 methods, namely OLM and the use ofsite-specific ambient N02/NOx ratios supported by ambient measurements. As noted above, we also believe it is appropriate to consider the

20PVMRM option as a Tier 3 detailed screening method at this time. The discussion here focuses primarily on the OLM and PVMRM methods, but we also note that the use ofsite-specific ambient N02INOx ratios will be subject to the same issues discussed above inrelation to the Tier 

### 2 default ARM, and as a result it will generally be much more difficult to determine an appropriate ambient N02 INOx ratio based on monitoring data for the new I-hour N02standard than for the annual standard.

While OLM and PVMRM are both based on the same simple chemical mechanism of titration to account for the conversion ofNO emissions to N02(see Eg. I) and therefore entail similar technical issues and considerations, there are some important differences that also need to be considered when assessing the appropriateness ofthese methods for specific applications. While the titration mechanism may capture the most important aspects ofNO-to-N02conversion in many applications, both methods will suffer from the same limitations for applications in which other mechanisms, such as photosynthesis, contribute significantlyto the overall process ofchemical transformation.' Sources located in areas with high levels ofVOC emissions may be subject to these limitations ofOLM and PVMRM. Titration is generally a much faster mechanism for converting NO to N02than photosynthesis, and as such is likely to be appropriate for characterizing peak I-hourN02 impacts in many cases.
Both OLM and PVMRM rely on the same key inputs ofin-stack N02 /NOx ratios and hourly ambient ozone concentrations. Although both methods can be applied within the AERMOD model using a single "representative" background ozone concentration, it is likely that use ofa single value would result in very conservative estimates ofpeak hourly ambient concentrations since its use for the I-hour N02standard would be contingent on a demonstration ofconservatism for all hours modeled. Furthermore, hourly monitored ozone concentrations used with the OLM and PVMRM options must be concurrent with the meteorological data period used in the modeling analysis, and thus the temporal representativeness ofthe ozone data for estimating ambient N02concentrations could be a factor in determining the appropriateness ofthe meteorological data period for a particular application. As noted above, the representativeness ofthese key inputs takes on somewhat greater importance in the context ofa I-hour N02 standard than for an annual standard, for obvious reasons. In the case ofhourly background ozone concentrations, methods used to substitute for periods ofmissing data may playamore significantrole in determining the I-hour N02 modeled design value, and should therefore be given greater scrutiny, especially for data periods that are likely to be associated with peak hourly concentrations based on meteorological conditions and source characteristics. In other words, ozone data substitution methods that may have been deemed appropriate in prior applications for the annual standard may not be appropriate to use for the new I-hour standard.

While these technical issues and considerations generally apply to both OLM and PVMRM, the importance ofthe in-stack N02INOx ratios may be more important for PVMRM than for OLM in some cases, due to differences between the two methods. The key difference between the two methods is that the amount ofozone available for conversion ofNO to N02 is based simply on the ambient ozone concentration and is independent ofsource characteristics for OLM, whereas the amount ofozone available for conversion in PVMRM is based on the amount ofozone within the volume ofthe plume for an individual source or group ofsources. The plume volume used in PVMRM is calculated on an hourly basis for each source/receptor



### 21combination, taking into account the dispersive properties ofthe atmosphere for that hour. For a low-level release where peak hourly NOx impacts occur close to the source under stable/light wind conditions, the plume volume will be relatively small and the ambient N02impact for such
cases will be largely determinedby the in-stack N02/NOx ratio, especially for sources with relatively close fenceline orambient air boundaries. This example also highlights the fact that the relative importance ofthe in-stack N02/NOx ratios may be greater for some applications than others, depending on the source characteristics and other factors. Assumptions regarding instackN02INOx ratios that mayhave been deemed appropriate in the context ofthe annual standard may not be appropriate to usc for the new I-hour standard. In particular, it is worth reiterating that the 

### 0.1 in-stack ratio often cited as the "default" ratio for OLM should not be treated as a default value for hourly N02compliance demonstrations.

Another difference between 0 LM and PVMRM that is worth noting here is the treatment ofthe titration mechanism for multiple sources ofNOx. There are two possible modes that can be used for applying OLM to mUltiple source scenarios within AERMOD: (l) apply OLM to each source separately and assume that each source has all ofthe ambient ozone available for conversion ofNO to N02; and (2) assume that sources whose plumes overlap compete for the available ozone and apply OLM on a combined plume basis. The latter option canbe applied selectively to subsets ofsources within the modeled inventory or to all modeled sources using the OLMGROUP keyword within AERMOD, and is likely to result in lower ambient N02 concentrations in most cases since the ambient N02 levels will be more ozone-limited. One of the potential refinements in application ofthe titration method incorporated in PVMRM is a technique for dynamically determining which sources should compete for the available ozone based on the relative locations ofthe plumes from individual sources, both laterally and vertically, on an hourly basis, taking into account wind direction and plume rise. While this approach addresses one ofthe implementation issues associated with OLM by making the decision ofwhich sources should compete for ozone, there is only very limited field study data available to evaluate the methodology.

Given the importance ofthe issue ofwhether to combine plumes for the OLM option, EPA has addressed the issue in the past through the Model Clearinghouse process. The general guidance that has emerged in those cases is that the OLM option should be applied on a sourceby-source basis in most cases and that combining plumes for application ofOLM would require
a clear demonstration that the plumes will overlap to such a degree that they can be considered as "merged" plumes. However, much ofthat guidance was provided in the context ofapplying the OLM method outsidethe dispersion model in a post-processing mode on an annual basis. The past guidance on this issue is still appropriate in that context since there is no realistic method to account for the degree ofplume merging on an hourly basis throughout the modeling analysis when applied as a post-processor. However, the implementation ofthe OLM option within the AERMOD model applies the method on a source-by-source, receptor-by-receptor, and hour-byhour basis. As a result, the application ofthe OLMGROUP option within AERMOD is such that the sources only compete for the available ozoneto the extent that each source contributes to the cumulative NOx concentration at each receptor for that hour. Sources which contribute significantly to the ambient NOx concentration at the receptor will compete for available ozone in proportion to their contribution, while sources that do not contribute significantly to the ambient NOx concentration will not compete for the ozone. Thus, the OLMGROUP option

22implemented in AERMOD will tend to be "self-correcting" with respect to concerns that combiningplumes for OLM will overestimate the degree ofozone limitingpotential (and therefore underestimate ambient N02 concentrations). As a result ofthese considerations, we recommend that use ofthe "OLMGROUP ALL" option, which specifies that all sources will potentially compete for the available ozone, be routinely applied and accepted for all approved applications ofthe OLM option in AERMOD. This recommendation is supportedby model-tomonitor comparisons ofhourly N02 concentrations ii-om the application ofAERMOD for the AtlantaN02risk and exposure assessment (EPA, 2008), and recent re-evaluations ofhourly N02 impacts fl'om the two field studies (New Mexico and Palaau) that were used in the evaluation of PVMRM (MACTEC, 2005). These model-to-monitor comparisons ofhourly N02 concentrations showreasonably good performance using the "OLMGROUP ALL" option within AERMOD, with no indication ofany bias to underestimate hourly N02 concentrations with OLMGROUP ALL. Furthermore, model-to-monitor comparisons based on OLM without the OLMGROUP option do exhibit a bias to overestimatehourly N02 concentrations. We will provide further details regarding these recent hourly N02 model-to-monitor comparisons at a later date.


### SUMMARY

To summarize, we emphasize the following points:

I. The 3-tiered screening approach recommended in Section 5.2.4 ofAppendix W for annual N02 assessments generally applies to the new I-hourN02 standard. 2. While generally applicable, application ofthe 3-tiered screening approach for assessments ofthe new I-hourN02 standard may entail additional considerations, such
as the importance ofkey input data, including appropriate emission rates for the I-hour standard vs. the annual standard for all tiers, and the representativeness ofin-stack N02 /NOx ratios and hourly background ozone concentrations for Tier 3 detailed screening methods. 3. Since the OLM and PVMRM methods in AERMOD are currently considered nonregulatory-default options, application ofthese options requiresjustification and approval by the Regional Office on a case-by-casebasis as alternative modelingtechniques, in accordance with Section 3.2.2, paragraph (e), ofAppendix W. 4. Applications ofthe OLM option in AERMOD, subjectto approval under Section 3.2.2.e ofAppendix W, should routinely utilize the "OLMGROUP ALL" option for combining plumes. 5. While the I-hourNAAQS for N02 is defined in terms ofthe 3-yearaverage for monitored design values to determine attainment ofthe NAAQS, this definition does not preempt or alter the Appendix W requirement for use of5 years ofNWS meteorological data or at least I year ofsite specific data.



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23D. Peters, R. W. Brode, and J. O. Paumier, 2004. AERMOD: Description ofModel Formulation with Addendum, EPA-4S4/R-03-004. U.S. Environmental Protection Agency, Research Triangle Park, NC.
Cole, B.S. and J.E. Summerhays, 1979. A Review ofTechniques Available for Estimation of Short-Term N02 Concentrations. Journal 

## of theAirPollution ControlAssociation, 29(8): 812- 817.
Chu, S.B. and E.L. Meyer, 1991. Use ofAmbient Ratios to Estimate Impact ofNOx Sources on Annual N02 Concentrations. Proceedings, 84th Annual Meeting & Exhibition ofthe Air & Waste Management Association, Vancouver, B.C.; 16-21 June 1991. (l6pp.) (Docket No. A92-65, II-A-9)
EPA, 1990. New Source Review Workshop Manual: Prevention ofSignificant Deterioration and Nonattainment Area Permitting

- DRAFT. U.S. Environmental Protection Agency, Research Triangle Park, NC.
EPA, 2004. User's Guide for the AMS/EPA Regulatory Model- AERMOD. EPA-4S4/B-03- 001. U.S. Environmental Protection Agency, Research Triangle Park, NC.
EPA, 2008. Risk and Exposure Assessment to Support the Review ofthe N02 Primary National Ambient Air Quality Standard. Office ofAir Quality Planning and Standards, Research Triangle Park, NC.
EPA, 2009. Addendum

- User's Guide for the AMS/EPA Regulatory Model- AERMOD. EPA-4S4/B-03-001. U.S. Environmental Protection Agency, Research Triangle Park, NC.
EPA,2010a. Applicability ofthe Federal Prevention ofSignificant Deterioration Permit Requirements to New and Revised National Ambient Air Quality Standards. Stephen D. Page Memorandum, dated April I, 2010. U.S. Environmental Protection Agency, Research Triangle Park, NC.
EPA,2010b. Modeling Procedures for Demonstrating Compliance with PM2
.5 NAAQS. Stephen D. Page Memorandum, dated March 23,2010. U.S. Environmental Protection Agency, Research Triangle Park, NC.
Hanrahan, P.L., I999a. The Plume Volume Molar Ratio Method for Determining N02/NOx Ratios in Modeling

- Part I: Methodology

. .! Air & Waste Manage. Assoc., 49, 1324-1331.
Hanrahan, P.L., 1999b. The Plume Volume Molar Ratio Method for Determining N02/NOx Ratios in Modeling

- Part II: Evaluation Studies

. .!Air & Waste Manage. Assoc., 49,1332- 1338.
MACTEC,2004. Sensitivity Analysis ofPVMRM and OLM in AERMOD. Final Report, Alaska DEC Contract No. 18-8018-04. MACTEC Federal Programs, Inc., Research Triangle Park, NC.

24MACTEC,2005. Evaluation ofBias in AERMOD-PVMRM. Final Report, Alaska DEC Contract No. 18-9010-12. MACTEC Federal Programs, Inc., Research Triangle Park, NC.

cc: Richard Wayland, C304-02 Anna Wood, C504-01 Raj Rao, C504-01 Roger Brode, C439-01 Dan deRoeck, C504-03 Elliot Zenick, OGC Brian Doster, OGe EPA Regional Modeling Contacts

25

### ATTACHMENT A Background on Hourly NOx Emissions for Permit Modeling for the I-hour N02 

### NAAQS

Introduction

The purpose ofthis attachment is to address questions about availability ofhourly NOx emissions for permitmodeling under the new N02 NAAQS. It summarizes existing guidance regarding emission input data requirements for NAAQS compliance modeling, and provides background on the historical approach to development ofinventories for N02permit modeling and computation ofhourly emissions appropriate for assessing the new I-hour N02 standard. Although the NAAQS is defined in terms ofambient N02concentrations, source emission estimates for modeling are based on NOx.

Under the PSD program, the owner or operator ofthe source is required to demonstrate that the source does not cause orcontribute to a violation ofa NAAQS (40 CFR 51.166 (k)(1) and 40 CFR 52.21 (k)(1» and/or PSD increments (40 CFR 51.166 (k)(2) and 52.21 (k)(2». However, estimation ofthe necessary emission input data for NAAQS compliance modeling entails consideration ofnumerous factors, and the appropriate reviewing authority should be consulted early in the process to determine the appropriate emissions data for use in specific modeling applications (see 40 CFR 51, Appendix W, 8.l.l.b and 8.2.3.b) Summary ofCurrent Guidance

Section 8.I ofthe Guideline onAir QualityModels, Appendix W to 40 CFR Part 5I, provides recommendations regarding source emission input data needed to support dispersion modeling for NAAQS compliance demonstrations. Table 8-2 ofAppendix W provides detailed guidance regarding the specific components ofthe emission input data, including the appropriate emission limits (pounds/MMBtu), operating level (MMBtu/hr), and operating factor (e.g., hr/yr
orhrlday), depending on the averaging time ofthe standard. Table 8-2 also distinguishes between the emission input data needed for the new ormodified sources being assessed, and "nearby" and "other" background sources included in the modeled emission inventory.

Based on Table 8-2, emission input data for new or modified sources for annual and quarterly standards are essentially the same as for short-term standards (:'0 24 hours), based on maximum allowable or federally enforceable emission limits, design capacity or federally enforceable permit conditions, and the assumption ofcontinuous operation. However, there are a few additional considerations cited in Appendix W that could result in diffcrent emission input data for the I-hour vs. annual N02 NAAQS. For example, while design capacity is listed as the recommended operating level for the emission calculation, peakhourly ground-level concentrations may be more sensitive than annual average concentrations to changes in stack parameters (effluent exit temperature and exit velocity) under different operating capacities. Table 8-2 specifically rccommends modeling other operating levels, such as 50 percent or 75 percent ofcapacity, for short-term standards (see footnote 3). Another factor that may affect maximum ground-level concentrations differently between the I-hour vs. annual standard isrestrictions on operating factors based on federally enforceable permit conditions. While federally enforceable operating factors other than continuous operation may be accounted for in the emission input data (e.g., ifoperation is limited to 8 am to 4 pm each day), Appendix Walso states that modeled emissions should not be averaged across non-operating time periods (see footnote 2 ofTable 8-2).

While emission input data recommendations for "nearby" and "other" background
sources included inthe modeled emission inventory are similar to the newor modified source emission inputs in manyrespects, there is an important difference in the operating factor between annual and short-term standards. Emission input data for nearby and other sources may reflect actual operating factors (averaged overthe mostrecent 2 years) for the annual standard, while continuous operation should be assumed for short-term standards. This could result in important differences in emission input data for modeled background sources for the I-hourN02 NAAQS relative to emissions used for the annual standard.

Model Emission Inventory for NO z Modeling

Forthe existing annual N02 NAAQS, the permit modeling inventory has generally been compiled from the annual state emission inventory questionnaire (EIQ) or Title V permit applications on file with the relevant permitting authority (state or local air program). Since a state uses the annual EIQ for Title V fee assessment, the state EIQ typically requires reporting of unit capacity, total fuel combusted, and/or hours ofoperation to help verify annual emissions calculations for fee accuracy purposes. Likewise, Title V operating permit applications contain all ofthe same relevant information for calculating emissions. While these emission inventories
are important resources for gathering emission input data on background sources for NAAQS compliance modeling, inventories which are based on actual operations may not be sufficient for short-term standards, such as the new I-hourN02NAAQS. However, appropriate estimates of emissions from background sources for the I-hour N02 standard may be derived in many cases from information in these inventories regarding permitted emission limits and operating capacity. Historically, it has not been a typical practice for an applicant to use the EPA's national emission inventory (NEI) as the primary source for compilingthe permit modeling inventory. Since the emission data submitted to the NEI represents annual emission totals, it may not be suitable for use in NAAQS compliance modeling for short-term standards since modeling should be based on continuous operation, even for modeled background sources. Although the NEI may provide emission data for background sources that are more appropriate for the annual N02 standard, the utility ofthe NEI for purposes ofNAAQS compliance modeling is further limited due to the fact that additional information regarding stack parameters and operatingrates required for modeling may not be available from the NEI. While records exist in the NEI for reporting stack data nccessary for point source modeling (i.e., stack coordinates, stackheights, exit temperatures, exitvelocities), some states do not report such information to the NEl, or there
are may be errors in the location data submitted to the NEI. Under such conditions, default stack information based upon SIC is substituted and use ofsuch data could invalidate modeling results. Building locations and dimensions, which may be required to account for building downwash influences in the modeling analysis, may also be missing or incomplete in many cases.

27A common and relatively straightforward approach for compilingthe necessary information to develop an inventory ofemissions from background sources for a permit modeling demonstration is as follows, patterned after the draft New Source Review Workshop Manual (EPA, 1990). The applicant completes initial modeling ofallowable emission increases associated with the proposed project and determines the radii ofimpact (ROI) for each pollutant and averaging period, based on the maximum distance at which the modeled ambient concentration exceeds the Significant Impact Level (SIL) for eachpollutant and averaging period. Typically, the largest ROI is selected and then a list ofpotential background sources within the ROI plus a screening distance beyond the ROI is compiled by the permitting authority and supplied to the applicant. The applicant typically requests permit applications or ElQ submittals from the records department ofthe permitting authority to gather stack data and
source operating data necessary to compute emissions for the modeled inventory. Once the applicant has gathered the relevant data from the permitting authorities, model emission rates are calculated. While this approach is fairly common, it should be noted that the draft workshop manual "is not intended to be an official statement ofpolicy and standards and does not establish binding regulatory requirements" (see, Preface), and the appropriate reviewing authority should be consulted early in the process regarding the selection ofappropriate background source emission inventories for the I-hour N02standard. We also note that Appendix W establishes "a significant concentration gradient in the vicinity ofthe source" under consideration as the main criterion for selection ofnearby sources for inclusion in the modeled inventory, and further indicates that "the number ofsuch [nearby] sources is expected to be small except in unusual situations." See Section 8.2.3.b.

As mentioned previously, modeled emission rates for short-term NAAQS are computed consistent with the recommendations ofSection 8.1 ofAppendix W, summarized in Table 8-2. The maximum allowable (SIP-approved process weight rate limits) or federally enforceable permit limit emissionrates assuming design capacity or federally enforceable capacity limitation
are used to compute hourly emissions for dispersion modeling against short-term NAAQS such
as the new I-hourN02NAAQS. Ifa source assumes an enforceable limit on the hourly firing capacity ofa boiler, this is reflected in the calculations. Otherwise, the design capacity ofthe
source is used to compute the model emissionrate. A load analysis is typically necessary to determine the load or operating condition that causes the maximum ground-level concentrations. In addition to 100 percent load, loads such as 50 percent and 75 percent are commonly assessed. As noted above, the load analysis is generally more important for short-term standards than for annual standards. For an hourly standard, other operating scenarios ofrelatively short duration such as "startup" and "shutdown" should be assessed since these conditions may result in maximum hourly ground-level concentrations, and the control efficiency ofemission control devices during these operating conditions may also need to be considered in the emission estimation.

Emission Calculation Example

The hourly emissions are most commonly computed from AP-42 emission factors based
on unit design capacity. For a combustion unit, the source typically reports both the unit capacity and the actual total amount offuel combusted annually (gallons, millions ofcubic feet

28ofgas, etc.) to the permitting authority for the EIQ. Likewise, Title V operating permit applications will contain similar information that can be used to compute hourly emissions.

For example, assume you are modeling an uncontrolled natural gas package boiler with a design firing rate of30 MMBtu/hr. The AP-42 emission factor for an uncontrolled natural gas external combustion source (AP-42, Section 1.4) for firing rates less than 100 MMBtu/hr is 100 lbs. 

### NOx/1 06 SCI' natural gas combusted. The hourly emissionrate is derived by converting the emission factor expressed in terms oflbs. NOx/l06 SCF to lbs. 

### NOx/MMBtu. The conversion is done by dividing the 100 lbs. NOx/l06 SCF by 1,020 to convert the AP-42 factor to lbs. 

### NOx/MMBtu. The new emission factor is now 0.098 lbs. 

### NOx/MMBtu.

For this example, the source has no limit on the hourly firing rate ofthe boiler; therefore, the maximum hourly emissions are computed by multiplying the design firing rate ofthe boiler by the new emission factor.

Ehoudy

### = 0.098 

### Ibs/MMBtu x 

### 30MMBtu/hr 

### =2.94 lbs/hr

Thus 2.94 lbs/hr represents the emission rate that would be input into the dispersion model for modeling against the I-hourN02 NAAQS to comport with emission rate recommendations of Section 8.1 ofAppendix W.
It is important to note that data derived for the annual state emission inventory (EI) is based on actual levels offuel combusted for the year, and is therefore different than how allowable emissions are computed for near-field dispersion modeling. Forthe annual EI report, a source computes their annual emissions based upon the AP-42 emission factor multiplied by the actual total annual throughput ortotal fuel combusted.

In the 30 MMBtu/hrboilerexample, the annual NOx emissions reported to the NEI is computed by:

Eam",al = (AP-42 emission factor) x (total annual fuel combusted)



### Ewl""al 

### = (100 lbs/l06 SCF) x (100 106 

### SCF/yr) 

### = 10,000 Ibs. 

### NOx/yr or 5 tons NOx/yr

29