SJVUAPCD 2201 - 1 12/18/08

RULE 2201 NEW AND MODIFIED STATIONARY SOURCE REVIEW RULE (Adopted

September 19, 1991; Amended March 11, 1992; Amended October 29, 1992; Amended December 17, 1992; Amended October 21, 1993 ; Amended June 15, 1995; Amended August 20, 1998; Amended June 21, 200 1 but not effective until August 20, 2001; Amended April 25, 2002; Amended De cember 19, 2002; Amended April 20, 2005; Amended December 15, 2005; Amended September 21, 2006; Amended (December 18, 2008), but not in effec t until (date of EPA final approval)) 1.0 Purpose The purpose of this rule is to provide for the foll owing: 1.1 The review of new and modified Stationary Sourc es of air pollution and to provide mechanisms including emission trade-offs by which A uthorities to Construct such sources may be granted, without interfering with th e attainment or maintenance of Ambient Air Quality Standards; and 1.2 No net increase in emissions above specified th resholds from new and modified Stationary Sources of all nonattainment pollutants and their precursors. 2.0 Applicability This rule shall apply to all new stationary source s and all modifications to existing stationary sources which are subject to the Distric t permit requirements and after construction emit or may emit one or more affected pollutant. The requirements of this rule in effect on the date the application is determined to be complete by the Air Pollution Control Officer (APCO) shall apply to such applicat ion.

3.0 Definitions 3.1 Actual Emissions: emissions having occurred fr om a source, based on source test or monitoring data, actual fuel consumption, and pr ocess data. If source test or monitoring data is not available, other appropriate , APCO-approved, emission factors may be used. 3.2 Actual Emissions Reduction (AER): the decrease of actual emissions, compared to the Baseline Period, from an emissions unit and sel ected for use as emission offsets or ERC banking. AER shall meet the following crite ria: 3.2.1 Shall be real, enforceable, quantifiable, sur plus, and permanent. 3.2.2 To be considered surplus, AER shall be in exc ess, at the time the application for an Emission Reduction Credit or an Authority to Construct authorizing such reductions is deemed complete, of any emission s reduction which: 3.2.2.1 Is required or encumbered by any laws, rule s, regulations, agreements, orders, orSJVUAPCD 2201 - 2 12/18/08 3.2.2.2 Is attributed to a control measure noticed for workshop, or proposed or contained in a State Implementation Pla n, or 3.2.2.3 Is proposed in the APCO's adopted air quali ty plan pursuant to the California Clean Air Act. 3.2.3 Emissions reductions attributed to a proposed control measure, which are excluded pursuant to Section 3.2.2.2 and 3.2.2.3 ma y be re-eligible as AER if the control measures identified in the District Air Quality Plan or State Implementation Plan (SIP), are determined not to be necessary for attainment or maintenance of Ambient Air Quality St andards and the APCO and United States Environmental Protection Agency ( EPA) have approved amendments to the plan or SIP to reflect this deter mination. 3.3 Administrative Change: a change to an existing permit that: 3.3.1 Corrects typographical errors; or 3.3.2 Identifies a change in the name, address, or phone number of any person identified in the permit, or provides a similar min or administrative change at the source; or 3.3.3 Changes the components of emissions monitorin g equipment or other components, which have no effect on the quantity of emissions from an emissions unit, or 3.3.4 Allows for the change of ownership or operati onal control of a source where the APCO determines that no other change is necessa ry. 3.4 Affected Pollutants: those pollutants for whic h an Ambient Air Quality Standard has been established by the EPA or by the Californi a Air Resources Board, (ARB), and the precursors to such pollutants, and those po llutants regulated by the EPA under the Federal Clean Air Act or by the ARB under the Health and Safety Code including, but not limited to, VOC, NO x , SO x , PM10, CO, and those pollutants which the EPA, after due process, or the ARB or the APCO, after public hearing, determine may have a significant adverse effect on the environment, the public health, or the public welfare. 3.5 Air Quality Improvement Deduction: a 10 percen t discount factor applied to Actual Emission Reductions (AER) before the AER is eligibl e for banking. 3.6 Ambient Air Quality Standards: include State a nd National Ambient Air Quality Standards. (In the inclusion of this rule in the S tate Implementation Plan, all references in this rule to Ambient Air Quality Stan dards shall be interpreted as National Ambient Air Quality Standards.) 3.7 Baseline Emissions (BE): for a given pollutant, shall be equal to the sum of:SJVUAPCD 2201 - 3 12/18/08 3.7.1 The pre-project Potential to Emit for: 3.7.1.1 Any emissions unit located at a non-Major S ource, 3.7.1.2 Any Highly-Utilized Emissions Unit, located at a Major Source, provided that if the unit has a Specific Limiting C ondition (SLC), all units combined under the SLC have an average co mbined annual Actual Emissions during the two consecutive years immediately prior to filing of an application for a n Authority to Construct equal to or greater than 80% of the units ’ pre-project SLC limit, 3.7.1.3 Any Fully-Offset Emissions Unit, located at a Major Source, provided that if the unit has a SLC, all units unde r the SLC also qualify as Fully Offset Emissions Units, or 3.7.1.4 Any Clean Emissions Unit, located at a Majo r Source, provided that if the unit has a SLC, all units under the SLC also qualify as Clean Emissions Units. 3.7.2 The Historic Actual Emissions (HAE) for emiss ions units not specified in Section 3.7.1. 3.8 Baseline Period: a period of time equal to eit her 3.8.1 the two consecutive years of operation immedi ately prior to the submission date of the Complete Application; or 3.8.2 at least two consecutive years within the fiv e years immediately prior to the submission date of the Complete Application if dete rmined by the APCO as more representative of normal source operation; or 3.8.3 a shorter period of at least one year if the emissions unit has not been in operation for two years and this represents the ful l operational history of the emissions unit, including any replacement units; or 3.8.4 zero years if an emissions unit has been in o peration for less than one year (only for use when calculating AER). 3.9 Best Available Control Technology (BACT): is th e most stringent emission limitation or control technique of the following: 3.9.1 Achieved in practice for such category and cl ass of source; 3.9.2 Contained in any State Implementation Plan ap proved by the Environmental Protection Agency for such category a nd class of source. A specific limitation or control technique shall no t apply if the owner of the proposed emissions unit demonstrates to the sat isfaction of the APCOSJVUAPCD 2201 - 4 12/18/08 that such a limitation or control technique is not presently achievable; or 3.9.3 Contained in an applicable federal New Source Performance Standard; or 3.9.4 Any other emission limitation or control tech nique, including process and equipment changes of basic or control equipment, fo und by the APCO to be cost effective and technologically feasible for such class or category of sources or for a specific source. 3.10 Biomass-fired power facility: a facility gene rating electrical power and fueled exclusively on biomass fuels consisting of at least 90% of one or more of the following constituents: alfalfa, barley, bean stra w, corn, oats, wheat, orchard and vineyard pruning, and forest residues. Grape stems , grape pumice, almond and walnut shells, construction wood waste, urban wood waste, and lawn trimmings are not considered biomass fuels. 3.11 Cargo Carriers: trains dedicated to a specifi c Stationary Source and vessel dockside activities as defined in 45 Federal Register 52696 (August 7, 1980) for vessels dedicated to a specific Stationary Source. Motor v ehicles, as defined by the Vehicle Code of the State of California, are not co nsidered Cargo Carriers. 3.12 Clean Emissions Unit: for a given pollutant, an emissions unit that meets one of the following criteria: 3.12.1 The unit is equipped with an emissions contr ol technology with a minimum control efficiency of at least 95% (or at l east 85% for lean-burn, internal combustion engines); or 3.12.2 The unit is equipped with emission control t echnology that meets the requirements for achieved-in-practice BACT as accep ted by the APCO during the five years immediately prior to the subm ission of the complete application. 3.13 Complete Application: an application for an E mission Reduction Credit or an Authority to Construct for a new or modified emissi ons unit which has been evaluated and found to include all information nece ssary to determine compliance with applicable rules and requirements. 3.14 Contiguous or Adjacent Property: a property c onsisting of two or more parcels of land with a common point or boundary, or separated solely by a public roadway or other public right-of-way. 3.15 Daily Emissions Limitation (DEL): one or more permit conditions which restrict a unit's maximum daily emissions, to a level at or be low the emissions associated with the maximum design capacity. A daily emission s limitation must be: 3.15.1 Contained in the latest Authority to Constru ct and contained in or enforceable by the latest Permit to Operate for the emissions unit; andSJVUAPCD 2201 - 5 12/18/08 3.15.2 Enforceable, in a practical manner, on a dai ly basis. 3.16 Emissions Unit: an identifiable operation or piece of process equipment such as a source operation which emits, may emit, or results in the emissions of any affected pollutant directly or as fugitive emissions. 3.17 Federal Major Modification: same as “Major Mo dification” as defined in 40 CFR 51.165 and part D of Title I of the CAA. SB 288 Ma jor Modifications are not federal major modifications if they meet the criter ia of one of the following exclusions: 3.17.1 Less-Than-Significant Emissions Increase Exc lusion: An emissions increase for the project, or a net emissions increa se for the project (as determined pursuant to 40 CFR 51.165 (a)(2)(ii)(B) through (D), and (F)), that is not significant for a given regulated NSR p ollutant, as defined in 40 CFR 51.165, is not a federal major modification for that pollutant. 3.17.1.1 To determine the post-project projected ac tual emissions from

existing units, the provisions of 40 CFR 51.165 (a) (1)(xxviii) shall be used.
3.17.1.2 To determine the pre-project baseline actu al emissions, the

provisions of 40 CFR 51.165 (a)(1)(xxxv)(A) through (D) shall be used. 3.17.1.3 If the project is determined not to be a f ederal major modification pursuant to the provisions of 40 CFR 5 1.165 (a)(2)(ii)(B), but there is a reasonable possibilit y that the project may result in a significant emissions incre ase, the owner or operator shall comply with all of the prov isions of 40 CFR 51.165 (a)(6) and (a)(7).
3.17.1.4 Emissions increases calculated pursuant to this section are

significant if they exceed the significance thresho lds specified in Table 3-1 of this rule. Table 3-1, Significance Thresholds POLLUTANT THRESHOLD (POUNDS PER YEAR) VOC 0 NOx 0 PM10 30,000 SOx 80,000
3.17.2 Plantwide Applicability Limit (PAL) Exclusio n: An SB 288 major modification that does not cause facility-wide emis sions to exceed a preestablished PAL, as defined in 40 CFR 51.165 (f)(2) (v), for the respective pollutant, is not a federal major modification for that pollutant. PALSJVUAPCD 2201 - 6 12/18/08 exclusions shall not be allowed for either NOx or V OC pollutants. 3.17.2.1 For the purposes of this exclusion, a PAL must be established

by a permitting action prior to the SB 288 major mo dification permitting action. 3.17.2.2 All PALs shall be established according to the provisions of 40

CFR 51.165 (f)(1) through (15). 3.17.2.3 All PALs shall comply with the requirement s under 40 CFR

51.165 (f)(1) through (15) to either maintain, rene w or retire the PAL. 3.18 Fugitive Emissions: emissions that could not reasonably pass through a vent, chimney, stack, or other functionally equivalent op ening. Emissions that are not vented through a stack but can reasonably be captur ed and vented through a stack are not considered Fugitive. Fugitive emissions sh all be included in all calculations, except as provided for in Section 3.2 3 and as allowed in the applicable 40 CFR Part 51.165. 3.19 Fully Offset Emissions Unit: for a given poll utant, an emissions unit for which 3.19.1 Offsets have been provided for the unit’s fu ll potential to emit; or 3.19.2 Offsets have been provided for the entire st ationary source’s potential to emit in excess of the offset trigger level; or 3.19.3 Offsets have previously been provided for th e stationary source’s NSR balance as calculated pursuant to the NSR rule in e ffect at the time of the offset action, and the emissions unit was installed after the County baseline date as indicated below: Table 3-2, County Baseline Dates
COUNTY BASELINE DATE San Joaquin County May 29, 1979 Stanislaus County June 19, 1979 Merced, Madera, or Kings County May 21, 1979 Fresno County Oil Fields September 20, 1983 Fresno County all other sources January 1, 1977 Tulare County June 26, 1979 September 12, 1979 Kern County Heavy Oil Production June 22, 1987 for heavy oil production operations with negative cumulative net emissions change as of

June 22, 1987 Kern County all other sources December 28, 1976SJVUAPCD 2201 - 7 12/18/08

3.20 Heavy Oil: crude oil having an American Petro leum Institute gravity of 20 degrees or less as determined by test method ASTM 287-82. 3.21 Highly Utilized Emissions Unit: for a given p ollutant, an emissions unit for which the average annual Actual Emissions during the two consecutive years immediately prior to filing of an application for an Authority to Construct were equal to or greater than 80% of the unit’s pre-project Potentia l to Emit. The unit must have been in operation for at least two years and, durin g that entire period, the unit must have complied with all applicable emission limits a nd performance standards. 3.22 Historical Actual Emissions (HAE): Actual Emis sions occurring during the Baseline Period, after discounting for: 3.22.1 Any emissions reductions required or encumbe red by any laws, rules, regulations, agreements, orders, or permits; and 3.22.2 Any emissions reductions attributed to a con trol measure noticed for workshop, or proposed or contained in a State Imple mentation Plan, and 3.22.3 Any emissions reductions proposed in the Dis trict air quality plan for attaining the annual reductions required by the Cal ifornia Clean Air Act, and 3.22.4 Any Actual Emissions in excess of those requ ired or encumbered by any laws, rules, regulations, orders, or permits. For units covered by a Specific Limiting Condition (SLC), the total overal l HAE for all units covered by SLC must be discounted for any emissions in excess of that allowed by the SLC.
3.23 Major Source: for each pollutant, a Stationar y Source with post-project emissions or a post-project Stationary Source Potential to Em it (SSPE2), equal to or exceeding one or more of the following threshold va lues. 3.23.1 For determining major source status, fugitiv es shall only be included for calculating the air pollutant post-project emission s or SSPE2 if the source is included in the list of source categories identi fied in the major source definition in 40 CFR Part 70.2, or when determining if a stationary source is a major air toxics source as defined in Rule 252 0. Table 3-3, Major Source Emission Thresholds

POLLUTANT THRESHOLD (POUNDS PER YEAR) VOC 20,000 NOx 20,000 CO 200,000 PM10 140,000 SOx 140,000SJVUAPCD 2201 - 8 12/18/08 3.23.2 For the purpose of determining major source status, the SSPE2 shall not include the quantity of emission reduction credits (ERC) which have been banked since September 19, 1991 for Actual Emission s Reductions that have occurred at the source, and which have not bee n used on-site. This ERC quantity includes all ERC held as certificates and all emission reduction credits that have been sold or transferre d.

3.24 Modification: 3.24.1 An action including at least one of the foll owing items: 3.24.1.1 Any change in hours of operation, producti on rate, or method

of operation of an existing emissions unit, which w ould necessitate a change in permit conditions. 3.24.1.2 Any structural change or addition to an ex isting emissions unit

which would necessitate a change in permit conditio ns. Routine replacement shall not be considered to be a structural change.

3.24.1.3 An increase in emissions from an emissions unit caused by a

modification of the Stationary Source when the emis sions unit is not subject to a daily emissions limitation. 3.24.1.4 Addition of any new emissions unit which i s subject to District

permitting requirements. 3.24.1.5 A change in a permit term or condition pro posed by an

applicant to obtain an exemption from an applicable requirement to which the source would otherwise be subject. 3.24.2 A reconstructed Stationary Source shall be t reated as a new Stationary Source and not as a modification. 3.24.3 Unless previously limited by a permit condit ion, the following shall not be considered a modification: 3.24.3.1 A change in ownership of an existing emiss ions unit with valid

Permit to Operate provided that the APCO determines that all applicable offset provisions required by the Permit to Operate will be met; 3.24.3.2 A change in ownership of an entire existin g Stationary Source

with a valid Permit to Operate; 3.24.3.3 A change which consists solely of a transf er of location of an emissions unit within a Stationary Source; orSJVUAPCD 2201 - 9 12/18/08 3.24.3.4 Routine replacement of a whole or partial emissions unit

where the replacement part is the same as the origi nal emissions unit in all respects except for the seria l number. 3.25 Offsets: emission reductions recognized by the APCO in the form of Emission Reduction Credits that are issued in accordance wit h the provisions of Rule 2301 (Emission Reduction Credit Banking), or other Actua l Emissions Reductions that may be used to mitigate an emission increase as par t of the same Stationary Source Project in accordance with the provisions of this r ule. 3.26 Potential to Emit: the maximum capacity of an emissions unit to emit a pollutant under its physical and operational design. Any phy sical or operational limitation on the capacity of the source to emit a pollutant, inc luding pollution control equipment and restrictions in hours of operation or on the ty pe or amount of material combusted, stored, or processed, shall be treated a s part of its design only if the limitation or the effect it would have on emissions is incorporated into the applicable permit as an enforceable permit conditio n. 3.27 PM10: particulate matter with an aerodynamic diameter smaller than or equal to a nominal ten microns, as defined in District Rule 10 20, Definitions.

3.28 Pre-baseline ERCs: Emission Reduction Credits that were banked prior to the baseline year for a given District-adopted and EPA- approved Attainment Plan. 3.29 Precursor: a directly emitted air contaminant that, when released into the atmosphere, forms or causes to be formed or contrib utes to the formation of a secondary air contaminant for which an Ambient Air Quality Standard has been adopted, or whose presence in the atmosphere will c ontribute to the violation of one or more Ambient Air Quality Standards. The followi ng precursor-secondary air contaminant relationships shall be used for the pur poses of this rule:
Table 3-4, Precursors
PRECURSOR SECONDARY AIR CONTAMINANT Volatile Organic Compounds a. Photochemical oxidants (Ozone) b. The organic fraction of PM10
Nitrogen Oxides a. Nitrogen Dioxide b. The nitrate fraction of PM10 c. Photochemical oxidants (Ozone)

Sulfur Oxides a. Sulfur dioxide b. Sulfates c. The sulfate fraction of PM10

3.30 Quarter: for a non-Seasonal Source, this is d efined as a calendar quarter. For a Seasonal Source, a quarter is defined as the entire operating season. 3.31 Reasonable Further Progress: as defined by th e federal Clean Air Act, SectionSJVUAPCD 2201 - 10 12/18/08 182(c)(2)(b). 3.32 Reconstructed Source: any Stationary Source u ndergoing reconstruction where the fixed capital cost of the new components exceeds 50 % of the fixed capital cost of a comparable, entirely new Stationary Source. Fixed capital cost is the capital needed to provide depreciable components. Reconstru cted Source cost shall include only the cost of all emission-producing equipment a nd associated integral activities at the stationary source. A reconstructed Stationa ry Source shall be considered a new Stationary Source and not as a modification of an existing Stationary Source. 3.33 Routine Replacement: routine replacement in w hole or in part of any article, machine, equipment, or other contrivance with a val id District Permit To Operate provided that all of the following conditions are m et: 3.33.1 There is no increase in permitted emissions from the replacement unit(s). 3.33.2 There is no increase in design capacity, unl ess an old part is no longer available in which case the replacement can result in a design capacity increase of up to 10%. No change to the permitted throughput or emissions is authorized due to a change in design c apacity as part of routine replacement. Such changes shall require ap plication for permit modification. 3.33.2.1 Permitted throughputs are throughput limit s upon which

emission calculations are, or could be, based. 3.33.2.2 If there are no throughput limiting condit ions, permitted

throughput shall be a throughput rate which affects emissions. 3.33.3 The replacement equipment performs the same function as the equipment being replaced. 3.33.4 The replacement does not constitute a Recons tructed Source (as defined by this rule) or Reconstruction (as defined by any applicable New Source Performance Standard). Reconstructed Source cost s hall include only the cost of all emission-producing equipment and associ ated integral activities at the stationary source. 3.33.5 When the entire emissions unit is replaced a s a routine replacement action, the emissions unit shall either have been a ddressed by a BARCT rule or shall be equipped with a control device cap able of at least 85% emission control. 3.34 SB 288 Major Modification: as defined in 40 C FR Part 51.165 (as in effect on December 19, 2002) and part D of Title I of the CAA (as in effect on December 19, 2002). For the purposes of this definition, the SB 288 major modification thresholds for existing major sources are listed as follows:SJVUAPCD 2201 - 11 12/18/08 Table 3-5, SB 288 Major Modification Thresholds POLLUTANT THRESHOLD (POUNDS PER YEAR) VOC 50,000 NOx 50,000 PM10 30,000 SOx 80,000
3.35 Seasonal Source: any Stationary Source with m ore than 90% of its annual emissions occurring within a consecutive 120-day pe riod. 3.36 Specific Limiting Condition (SLC): permit ter ms or conditions, which can be enforced in a practical manner, contained in Author ities to Construct and Permits to Operate and established pursuant to New Source Revi ew provisions that restrict the total overall permitted emissions from two or more emissions units. 3.37 Stationary Source: any building, structure, f acility, or installation which emits or may emit any affected pollutant directly or as a fu gitive emission. Building, structure, facility or installation includes all po llutant emitting activities including emissions units which: 3.37.1 Are under the same or common ownership or op eration, or which are owned or operated by entities which are under commo n control; and 3.37.2 Belong to the same industrial grouping eithe r by virtue of falling within the same two-digit standard industrial classificati on code or by virtue of being part of a common industrial process, manufact uring process, or connected process involving a common raw material; and 3.37.3 Are located on one or more contiguous or adj acent properties; or 3.37.4 Are located on one or more properties wholly within either the Western Kern County Oil Fields or the Central Kern County O il Fields or Fresno County Oil Fields and are used for the production o f light oil, heavy oil or gas. Notwithstanding the provisions of this defini tion, light oil production, heavy oil production, and gas productio n shall constitute separate Stationary Sources. 3.38 Stationary Source Project: a single permittin g action involving the modification, addition or shutdown of one or more emissions units . If any increase in emissions from a new or modified emissions unit is permitted based on emission reductions from one or more emissions units included in the st ationary source project, the following condition must also be met: 3.38.1 The modification or shutdown resulting in th e necessary emission reductions shall occur not later than the date of i nitial operation of the new or modified emissions unit. If the new or modified emissions unit is, in whole or in part, a replacement for an existing emi ssions unit at the sameSJVUAPCD 2201 - 12 12/18/08 stationary source, the APCO may allow a maximum of 90 days as a start up period for simultaneous operation of the existin g emissions unit and the replacement emissions unit. 3.39 Temporary Replacement Emissions Unit (TREU): an emissions unit which is at a Stationary Source for less than 180 days in any twe lve month period and replaces an existing emissions unit which is shutdown for ma intenance or repair.

3.39.1 The Potential to Emit from a TREU must not e xceed the Potential to Emit from the existing emissions unit. 3.39.2 If a TREU is used to replace a TREU, the com bined time at the Stationary Source for the two TREU shall not exceed a total of 180 days in any twelve-month period.

3.39.3 An emissions unit not removed from the Stati onary Source within 180 days is not a TREU. 4.0 Source Requirements 4.1 Best Available Control Technology (BACT): BACT requirements shall be triggered on a pollutant-by-pollutant basis and on an emissions unit-by-emissions unit basis. Unless exempted pursuant to Section 4. 2, BACT shall be required for the following actions: 4.1.1 Any new emissions unit or relocation from one Stationary Source to another of an existing emissions unit with a Potent ial to Emit exceeding 2.0 pounds in any one day; 4.1.2 Modifications to an existing emissions unit w ith a valid Permit to Operate resulting in an Adjusted Increase in Permitted Emis sions (AIPE) exceeding 2.0 pounds in any one day; 4.1.3 Any new or modified emissions unit, in a stat ionary source project, which results in an SB 288 Major Modification or a Federa l Major Modification, as defined in this rule. 4.2 BACT Exemptions: BACT shall not be required fo r the following:

4.2.1 CO emissions from a new or modified emissions unit at a Stationary Source with a post project Stationary Source Potential to Emit (SSPE2) of less than 200,000 pounds CO per year; 4.2.2 Cargo Carriers; 4.2.3 For existing facilities, the installation or modification of an emission control technique performed solely for the purpose of compl iance with the requirements of District, State or Federal air poll ution control laws,SJVUAPCD 2201 - 13 12/18/08 regulations, or orders, as approved by the APCO, sh all be exempt from Best Available Control Technology for all air pollutants , provided all of the following conditions are met: 4.2.3.1 There shall be no increase in the physical or operational design

of the existing facility, except for those changes to the design needed for the installation or modification of the emission control technique itself; 4.2.3.2 There shall be no increase in the permitted rating or permitted operating schedule of the permitted unit;

4.2.3.3 There shall be no increase in emissions fro m the stationary

source that will cause or contribute to any violati on of a National Ambient Air Quality Standard, Prevention of Signifi cant Deterioration increment, or Air Quality Related Val ue in Class I areas; and 4.2.3.4 The project shall not result in an increase in permitted emissions

or potential to emit of more than 25 tons per year of NOx, or 25 tons per year of VOC, or 15 tons per year of SOx, o r 15 tons per year of PM-10, or 50 tons per year of CO. 4.2.3.5 The project shall not constitute a federal major modification.

4.2.4 New emissions unit or modification of an exis ting emissions unit for voluntary reduction in emissions, for the sole purp ose of generating emission reduction credits. This exemption applies only to the pollutant for which emission reduction credits are obtained. BAC T may be required for other affected pollutants; 4.2.5 Temporary Replacement Emissions Units; 4.2.6 Routine Replacement; or

4.2.7 Transfer of location of emissions units withi n the same stationary source. 4.3 Adjusted Increase in Permitted Emissions (AIPE) Calculations: Adjusted Increase in Permitted Emissions shall be calculated as AIPE = PE2 - HAPE Where: AIPE = Adjusted Increase in Permitted Emissions, p ounds per day PE2 = the emissions units post project Potential to Emit, pounds per day HAPE = the emissions unit’s Historically Adjusted Potential to Emit, pounds per

day 4.4 Historically Adjusted Potential to Emit (HAPE) Calculations: Historically Adjusted Potential to Emit shall be calculated asSJVUAPCD 2201 - 14 12/18/08

HAPE = PE1 x (EF2 / EF1)

Where: PE1 = The emissions unit’s Potential to Emit prior to modification or relocation EF2 = The emissions unit’s permitted emission facto r for the pollutant after modification or relocation. If EF2 is greater than EF1 then EF2/EF1 shall be set to 1. EF1 = The emissions unit’s permitted emission facto r for the pollutant before the modification or relocation
4.5 Emission Offset Requirements: 4.5.1 If emission offset requirements are triggered pursuant to Section 4.5.3, emission offsets shall be provided for net emission s increases resulting from a project. Offset quantities shall be calculated p ursuant to Section 4.7. 4.5.2 For Stationary Sources with a quarterly Poten tial to Emit which remain constant throughout the year, the amount shall be c alculated in pounds per year. For Stationary Sources with quarterly Potent ial to Emit that is not constant throughout the year, and for Seasonal Sour ces the amount shall be calculated in pounds per quarter. 4.5.3 Offset requirements shall be triggered on a p ollutant-by-pollutant basis. Unless exempted pursuant to Section 4.6, offsets sh all be required if the post-project Stationary Source Potential to Emit (S SPE2) equals or exceeds the following offset threshold levels:
Table 4-1, Emissions Offset Threshold Levels

POLLUTANT SSPE2 (POUNDS /YEAR) VOC 20,000 NOx 20,000 CO (non-attainment areas) 30,000 CO (attainment areas) 200,000 SOx 54,750 PM10 29,200
4.6 Emission Offset Exemptions: Emission offsets s hall not be required for the following:

4.6.1 Increases in carbon monoxide in attainment ar eas if the applicant demonstrates to the satisfaction of the APCO, that the Ambient Air Quality Standards are not violated in the areas to be affec ted, and such emissions will be consistent with Reasonable Further Progress , and will not cause or contribute to a violation of Ambient Air Quality St andards; 4.6.2 Emergency equipment that is used exclusively as emergency standby equipment for electric power generation or any othe r emergency equipmentSJVUAPCD 2201 - 15 12/18/08 as approved by the APCO that does not operate more than 200 hours per year for non-emergency purposes and is not used pur suant to voluntary arrangements with a power supplier to curtail power . Equipment exempted by this section shall maintain a written record of hours of operation and shall have permit conditions limiting non-emergency operation; 4.6.3 Portable equipment which is registered as suc h in accordance with the provisions of Rule 2280 (Portable Equipment Registr ation) or the Statewide Portable Equipment Registration Program (California Code of Regulation Title 13, Article 5, Sections 2450-2465), or equipm ent registered in accordance with the provisions of Rule 2250 (Permit -Exempt Equipment Registration). 4.6.4 On-site soil or groundwater decontamination p erformed by, under the jurisdiction of, or pursuant to the requirements of an authorized health officer, agricultural commissioner, fire protection officer, or other authorized government officers, provided emissions do not exceed 4,000 pounds per year of any affected pollutant from all emissions units associated with decontamination project; 4.6.5 Temporary Replacement Emissions Units.

4.6.6 A transfer of location of an entire Stationar y Source within the District, under the same owner and provided: 4.6.6.1 The Potential to Emit of any affected pollu tant will not be greater

at the new location than at the previous location w hen all emissions units are operated at the same permitted conditions; and 4.6.6.2 BACT is applied to all emissions units with a Potential to Emit

exceeding 2.0 pounds per day; and 4.6.6.3 The transferred Stationary Source is not ad ded to an existing

Stationary Source.

4.6.7 A transfer of location of an emissions unit f rom one Stationary Source to another within the District, under the same owner a nd provided: 4.6.7.1 The Potential to Emit of any affected pollu tant will not be greater

at the new location than at the previous location w hen all emissions units are operated at the same permitted conditions, and 4.6.7.2 The offsets that would be otherwise require d for the unit at the

new location have been provided for the emissions u nit previously.SJVUAPCD 2201 - 16 12/18/08 4.6.8 For existing facilities, the installation or modification of an emission control technique performed solely for the purpose of compl iance with the requirements of District, State or Federal air poll ution control laws, regulations, or orders, as approved by the APCO, sh all be exempt from offset requirements for all air pollutants provided all of the following conditions are met: 4.6.8.1 There shall be no increase in the physical or operational design of

the existing facility, except for those changes to the design needed for the installation or modification of the emission control technique itself; 4.6.8.2 There shall be no increase in the permitted rating or permitted operating schedule of the permitted unit;

4.6.8.3 There shall be no increase in emissions fro m the stationary source

that will cause or contribute to any violation of a National Ambient Air Quality Standard, Prevention of Signifi cant Deterioration increment, or Air Quality Related Val ue in Class I areas; and 4.6.8.4 The project shall not result in an increase in permitted emissions

or potential to emit of more than 25 tons per year of NOx, or 25 tons per year of VOC, or 15 tons per year of SOx, o r 15 tons per year of PM-10, or 50 tons per year of CO. 4.6.9 Agricultural sources, to the extent provided by California Health and Safety Code, section 42301.18(c), except that nothing in t his section shall circumvent the requirements of section 42301.16(a). 4.7 Emission Offset Quantity Calculations: 4.7.1 For pollutants with a pre-project Stationary Source Potential to Emit (SSPE1) greater than the emission offset threshold levels, emission offsets shall be provided for: 4.7.1.1 All increases in Stationary Source emission s, calculated as the

sum of differences between the post-project Potenti al to Emit (PE2) and the Baseline Emissions (BE) of all new an d modified emissions units, plus 4.7.1.2 All increases in Cargo Carrier emissions. 4.7.2 For pollutants with a pre-project Stationary Source Potential to Emit (SSPE1) less than or equal to the offset threshold levels, emission offsets shall be provided for: 4.7.2.1 All increases in Stationary Source emission s above the offsetSJVUAPCD 2201 - 17 12/18/08 trigger levels, calculated as the difference betwee n the SSPE2 and the offset trigger level, plus 4.7.2.2 All increases in Cargo Carrier emissions. 4.7.3 The quantity of offsets calculated pursuant t o Sections 4.7.1 and 4.7.2 shall be multiplied by the appropriate Distance Offset Ra tio to determine the final quantity of offsets required. 4.7.4 PM10 Emissions: In determining the quantity of required PM10 offsets, the Total Suspended Particulate Matter (TSP) emissions for which full offsets have been previously provided shall not be recalcul ated as PM10.

4.8 Distance Offset Ratio: For offset calculations , the distance offset ratio shall be as shown below:

4.8.1 For NOx and VOC offsets for new major sources and f ederal major modifications, the distance offset ratio shall be 1 .5;

4.8.2 The requirements of section 4.8.1 shall not apply i f the District demonstrates to the satisfaction of the federal Env ironmental Protection Agency that all major sources of NOx and VOC in the District are equipped with federal BACT, as defined in CAA Section 169(3) . After EPA approval of such a demonstration, the standard dist ance offset ratios listed in Table 4-2 shall apply for new major sources and fed eral major modifications, except that where the original locat ion of the offsets is at the same stationary source as the new or modified emiss ions unit, the distance offset ratio shall be 1.2.

4.8.3 For all other projects not specified above, the sta ndard distance offset ratio shall be as shown in Table 4-2:

Table 4-2, Standard Distance Offset Ratio
ORIGINAL LOCATION OF EMISSION OFFSETS OFFSET RATIO at the same Stationary Source as the new or modifie d

emissions unit 1.0

within 15 miles of the new or modified emissions un it’s

Stationary Source 1.2 for Non-Major Sources 1.3 for Major Sources 15 miles or more from the new or modified emissions unit’s

Stationary Source 1.5

4.9 Pre-project Stationary Source Potential to Emit (SSPE1) shall be calculated as the sum of the following:

4.9.1 The Potential to Emit from all units with val id Authorities to Construct (ATC) or Permits to Operate (PTO) at the Stationary Source.SJVUAPCD 2201 - 18 12/18/08 4.9.1.1 For a unit with both a valid ATC and a PTO or a unit with multiple valid ATC, use the ATC or PTO with the hig hest potential emissions. 4.9.1.2 For units subject to an SLC, the Potential to Emit shall be based on the overall Potential to Emit limit for all unit s covered by the SLC and not the sum of the individual Potential to Emit of each emissions unit. 4.9.2 The quantity of emission reduction credits (E RC) which have been banked since September 19, 1991 for Actual Emissions Reduc tions that have occurred at the source, and which have not been use d on-site. This quantity includes all ERC held as certificates and all emiss ion reduction credits that have been sold or transferred. Reductions shall be added to the SSPE1 as positive values. 4.10 Post-project Stationary Source Potential to Em it (SSPE2) shall be calculated, on a pollutant-by-pollutant basis, as the sum of the fol lowing:

4.10.1 The Potential to Emit from all units with va lid Authorities to Construct or Permits to Operate at the Stationary Source, except for emissions units proposed to be shutdown as part of a Stationary Sou rce Project. 4.10.1.1 The Potential to Emit of the post-project Authority to

Construct will be used for new or modified units, p rovided that the ATC will include new conditions canceling the e xisting ATC or PTO for those units, otherwise use the ATC o r PTO with the highest potential emissions. 4.10.1.2 For units subject to an SLC, the Potential to Emit shall be

based on the overall Potential to Emit limit for al l units covered by the SLC and not the sum of the individua l Potential to Emit of each emissions unit. 4.10.2 The quantity of emission reduction credits ( ERC) which have been banked since September 19, 1991 for Actual Emission s Reductions that have occurred at the source, and which have not bee n used on-site. This quantity includes all ERC held as certificates and all emission reduction credits that have been sold or transferred. Reduct ions shall be added to the SSPE2 as positive values. 4.11 Calculations involving PM10 emissions 4.11.1 For existing Stationary Sources for which pa rticulate matter emissions have been calculated as Total Suspended Particulate (TSP), the PM10 emissions shall be recalculated from TSP values usi ng PM10 emission factors or speciation data.SJVUAPCD 2201 - 19 12/18/08 4.11.2 In the absence of PM10 emissions factors or speciation data, assume 50% of the total suspended particulates is PM10. 4.11.3 If the applicant has previously provided ful l offsets for total suspended particulate matter emissions, those total suspended particulate matter emissions need not be recalculated as PM10, for the purpose of determining the quantity of offsets. 4.12 Actual Emissions Reductions (AER) Calculations : Actual Emissions Reductions shall be calculated, on a pollutant-by-pollutant ba sis, as follows:

AER = HAE - PE2 Where: HAE = Historic Actual Emissions PE2 = Post-project Potential to Emit 4.12.1 Prior to banking, AER shall be discounted by 10 percent (10%) for Air Quality Improvement Deduction, and shall comply wit h all applicable provisions of Rule 2301 (Emission Reduction Credit Banking). 4.13 Additional Offset Requirements: Offsets obtai ned subject to this rule shall comply with the following provisions: 4.13.1 Major Source shutdowns or permanent curtailm ents in production or operating hours of a Major Source may not be used a s offsets for emissions from a Major Source, a Federal Major Modi fication, or an SB 288 Major Modification, unless the ERC, or the emis sions from which the ERC are derived, has been included in an EPA-approv ed attainment plan. 4.13.2 Offsets from another district may be used on ly if the source of the offsets is within 50 miles of the proposed emissions increa ses and the APCO has reviewed the permit conditions issued by the distri ct in which the proposed offsets are obtained and certifies that su ch offsets meet the requirements of this rule and CH&SC Section 40709.6

. 4.13.3 Interpollutant offsets may be approved by th e APCO on a case-by-case basis, provided that the applicant demonstrates to the satisfaction of the APCO, that the emission increases from the new or m odified source will not cause or contribute to a violation of an Ambien t Air Quality Standard. In such cases, the APCO shall, based on an air qual ity analysis, impose offset ratios equal to or greater than the requirem ents of this rule. 4.13.3.1 In no case shall exempt compounds or the o ther compounds

excluded from the definition of VOC be used as offs ets for VOC. 4.13.3.2 Interpollutant offsets between PM10 and PM 10 precursors

may be allowed.SJVUAPCD 2201 - 20 12/18/08 4.13.3.3 PM10 emissions shall not be allowed to off set NOx or reactive organic compound emissions in ozone nonattainment a reas, nor be allowed to offset SO2 emissions in sulfate nonattainment areas. 4.13.3.4 Interpollutant offsets between NOx and VOC may be allowed. 4.13.4 Actual Emissions Reductions (AER) used as of fsets must have occurred during the same calendar quarter as the emissions i ncreases being offset except as allowed pursuant to Sections 4.13.6 throu gh 4.13.9.

4.13.5 AER used as offsets for a Seasonal Source mu st have occurred during the same time period as the proposed source will operat e except as allowed pursuant to Sections 4.13.6 through 4.13.9. 4.13.6 AER used as offsets for a biomass-fired powe r facility may have occurred during any quarter. 4.13.7 AER for PM that occurred from October throug h March, inclusive, may be used to offset increases in PM during any period of the year. 4.13.8 AER for NOx and VOC that occurred from April through November may be used to offset increases in NOx and VOC during a ny period of the year.
4.13.9 AER for CO that occurred from November throu gh February may be used to offset increases in CO during any period of the year.

4.13.10 AER used as offsets for new and modified Ma jor Sources must be obtained from an area:

4.13.10.1 That has a nonattainment classification t hat is equal to or

higher than the area in which the new or modified M ajor Source is located, and

4.13.10.2 Where emissions contribute to a violation of a national

Ambient Air Quality Standard in the area in which t he new or modified Major Source is located. 4.13.11 Offsets required as a condition of an Autho rity to Construct or a Permit to Operate shall commence not later than the date of i nitial operation of the new or modified emissions unit.
4.13.11.1 If the new or modified emissions unit is, in whole or in part, a

replacement for an existing emissions unit at the s ame stationary source, the APCO may allow a maximum of 90 days as a start up period for simultaneous operatio n of the existing emissions unit and the replacement emissio ns unit.SJVUAPCD 2201 - 21 12/18/08 4.13.12 Nothing in this rule shall be construed as requiring ERC used as NSR offsets to be discounted at time of use, except for the additional offsets as required by Sections 4.8, 4.13.3, and as described in Section 7.0. 4.14 Ambient Air Quality Standards: 4.14.1 Emissions from a new or modified Stationary Source shall not cause or make worse the violation of an Ambient Air Quality Standard. In making this determination, the APCO shall take into accoun t the increases in minor and secondary source emissions as well as the mitigation of emissions through offsets obtained pursuant to this rule. Modeling used for the purposes of this rule shall be consistent w ith the requirements contained in the most recent edition of EPA's "Guid eline on Air Quality Models" unless the APCO finds such model is inappro priate for use. After making such a finding, the APCO may designate an alternative model only after allowing for public comments and o nly with the concurrence of the ARB or the EPA.
4.14.1.1 At the discretion of the APCO, a new or mo dified source

which is not subject to the public noticing require ments of Section 5.4 shall be exempted from the requirements of Section 4.14.1. 4.15 Additional Requirements for new Major Sources and Federal Major Modifications 4.15.1 Alternative siting: For those sources for w hich an analysis of alternative sites, sizes, and production processes is required under Section 173 of the Federal Clean Air Act, the applicant shall prepare an analysis functionally equivalent to the requirements of Division 13, Sect ion 21000 et. seq. of the Public Resources Code. 4.15.2 Compliance by Other Owned, Operated, or Cont rolled Source: The owner of a proposed new Major Source or federal maj or modification shall demonstrate to the satisfaction of the APCO t hat all major Stationary Sources owned or operated by such person (or by any entity controlling, controlled by, or under common control with such pe rson) in California which are subject to emission limitations are in co mpliance or on a schedule for compliance with all applicable emissio n limitations and standards.SJVUAPCD 2201 - 22 12/18/08

5.0 Administrative Requirements The administrative requirements of Sections 5.1 thr ough 5.7, inclusive, shall be applied to all applications for a new or modified emissions un it except for power plants proposed to be constructed in the District and for which a Noti ce of Intention (NOI) or Application for Certification (AFC) has been accepted by the Califo rnia Energy Commission. For such power plants, the administrative requirements of Se ction 5.8 shall apply.
5.1 Complete Application: The APCO shall determine whether the application is complete not later than 30 days after receipt of th e application, or after such longer time as both the applicant and the APCO may agree.
5.1.1 If the APCO determines that the application i s not complete, the applicant shall be notified in writing of the decision specif ying the information required. Upon receipt of any resubmittal of the a pplication, a new 30-day period to determine completeness shall begin. 5.1.2 Completeness of an application or resubmitted application shall be evaluated on the basis of the information requireme nts set forth in the District Rules and Regulations as they exist on the date on which the application or resubmitted application is received. 5.1.3 Upon determination that the application is co mplete, the APCO shall notify the applicant in writing. 5.1.4 The APCO may, during the processing of the ap plication, request an applicant to clarify, amplify, correct, or otherwis e supplement the information submitted in the application. 5.2 Preliminary Decision: Following acceptance of an application as complete, the APCO shall perform the evaluations required to dete rmine compliance with this rule and make a preliminary written decision as to whether an Authority to Construct should be approved, conditionally approve d, or disapproved. 5.2.1 The APCO shall deny any Authority to Construc t if the APCO finds that the subject of the application would not comply with th e standards set forth in this rule or any other District rule. 5.2.2 The decision shall be supported by a succinct , written analysis. 5.3 Final Action: Within 180 days after acceptance of an application as complete, or within 180 days after the lead agency has approved the project under the California Environmental Quality Act, whichever occurs later, the APCO shall take final action on the application after considering all wri tten comments. 5.4 Public Notification and Publication Requirement s: The APCO shall provide public notification and publication for the following type s of applications:SJVUAPCD 2201 - 23 12/18/08 5.4.1 New Major Sources, Federal Major Modification s, and SB 288 Major Modifications. 5.4.2 Applications which include a new emissions un it with a Potential to Emit greater than 100 pounds during any one day for any one affected pollutant; 5.4.3 Modifications that increase the Stationary So urce Potential to Emit (SSPE1) from a level below the emissions offset threshold l evel to a level exceeding the emissions offset threshold level for one or mor e pollutants; 5.4.4 New Stationary Sources with post-project Stat ionary Source Potential to Emit (SSPE2) exceeding the emissions offset thresho ld level for one or more pollutants; 5.4.5 Any permitting action resulting in a Stationa ry Source Project Increase in Permitted Emissions (SSIPE) exceeding 20,000 pounds per year for any one pollutant.

5.5 Public Notification and Publication Actions: F or the types of applications listed in Section 5.4, the APCO shall perform the following a ctions: 5.5.1 Within ten (10) calendar days following the p reliminary decision the APCO shall publish in at least one newspaper of general circulation in the District a notice stating the preliminary decision, noting how pertinent information can be obtained, and inviting written public commen t for a 30 day period following the date of publication. 5.5.2 No later than the date of publication, the AP CO shall transmit to the applicant its preliminary written decision, the ana lysis, and a copy of the notice submitted for publication. 5.5.3 No later than the date of publication, the AP CO shall transmit to the ARB and to any person who requests such information, it s preliminary written decision, the analysis, and a copy of the notice su bmitted for publication. For new Major Sources, Federal Major Modifications, and SB 288 Major Modifications, the APCO shall also transmit the pre liminary written decision and supporting documents to the EPA. 5.5.4 No later than the time the notice of the prel iminary decision is published, the APCO shall make available for public inspection at the District office the information submitted by the applicant and the analysis. 5.5.5 The APCO shall provide written notice of the final action to the applicant, and the ARB, and shall publish such notice in a new spaper of general circulation, except that for an application not sub ject to Section 5.4, the APCO shall not be subject to this section. In such a case, the applicant shall receive notification as provided in Rule 2040 (Appl ications). For new Major Sources, Federal Major Modifications, and SB 288 MajorSJVUAPCD 2201 - 24 12/18/08 Modifications, the APCO shall also transmit written notice of the final action to the EPA.

5.5.6 No later than the time of notice of final act ion is published, the APCO shall make available for public inspection at the Distric t office a copy of the notice submitted for publication and all supporting documents. 5.6 Authority to Construct (ATC) - General Conditio ns

5.6.1 An ATC shall not be issued unless the new or modified source complies with the provisions of this rule and all other appl icable District Rules and Regulations. 5.6.2 An ATC shall require that the new or modified source be built according to the specifications and plans contained in the appli cation.

5.6.3 An ATC shall include all those conditions whi ch the APCO deems necessary to assure construction and operation in t he manner assumed in making the analysis to determine compliance with th is rule.

5.6.4 An ATC shall include all those conditions rel ating to the satisfaction of the offset requirements of this rule.

5.6.5 An ATC issued for an emissions unit that reli es on reduction in emissions from other units included in the Stationary Source Project, must include a condition that requires initiating and completing c onstruction on those units that provide the reduction prior to commencing oper ation of the unit with increase in emissions.
5.6.5.1 If the new or modified emissions unit is, i n whole or in part, a replacement for an existing emissions unit at the s ame stationary source, the APCO may allow a maximum of 90 days as a start up period for simultaneous operation of the existing e missions unit and the replacement emissions unit. 5.7 Permit to Operate (PTO) - General Conditions 5.7.1 A PTO shall require that the new source or mo dification be operated in the manner assumed in making the analysis to determine compliance with this rule and as conditioned in the Authority to Constru ct. 5.7.2 A PTO shall include daily emissions limitatio ns and other enforceable conditions which reflect applicable emission limits including the offset requirements. 5.7.3 The APCO shall determine if the applicant has complied with all the conditions in the ATC. The APCO may allow conditio ns which have not been met at the time the PTO is issued to be incorp orated into the Permit toSJVUAPCD 2201 - 25 12/18/08 Operate, provided that compliance with that conditi on is demonstrated by a specified date. 5.7.4 Any source which provides offsets shall be su bject to enforceable permit conditions containing specific operational and emis sions limitations, which ensure that the emissions reductions will be provid ed in accordance with the provisions of this rule and shall continue for the reasonably expected life of the proposed source. Where the source of offsets i s not subject to a permit, a written contract shall be required between the ap plicant and the owner of such source, which contract, by its terms, shall be enforceable by the APCO. The permit and contract shall be submitted t o the ARB to be forwarded to the EPA as part of the State Implement ation Plan. A violation of the emission limitation provisions of any such c ontract shall be chargeable to the applicant. 5.7.5 Offsets required as a condition of an ATC or a PTO shall commence not later than the date of initial operation of the new or modified source, 5.7.5.1 If a new or modified Stationary Source is, in whole or in part, a replacement for an existing Stationary Source on th e same or contiguous property the APCO may allow a maximum of 90 days as a start up period for simultaneous operation of the existing Stationary Source and the new or replacement source

. 5.8 Power plants which will be licensed by the Cali fornia Energy Commission: The administrative requirements of this section shall b e applied to all power plants proposed to be constructed in the District and for which a Notice of Intention (NOI) or Application for Certification (AFC) has been acc epted by the California Energy Commission. The APCO may apply for reimbursement o f all costs incurred, including lost fees, in order to comply with the pr ovisions of this section. 5.8.1 Intent to Participate and Preliminary Report: Within 14 days of receipt of a NOI, the APCO shall notify the ARB and the Californ ia Energy Commission of the APCO's intent to participate in t he NOI proceeding. If the APCO chooses to participate in the NOI proceedi ng, the APCO shall prepare and submit a report to the ARB and the Cali fornia Energy Commission prior to the conclusion of the nonadjudi catory hearings specified in Section 25509.5 of the Public Resource s Code. The report shall include at least: 5.8.1.1 A preliminary specific definition of BACT f or the proposed facility. 5.8.1.2 A preliminary discussion of whether there i s substantial likelihood that the requirements of this rule and all other Di strict rules can be satisfied by the proposed facility. 5.8.1.3 A preliminary list of conditions which the proposed facility mustSJVUAPCD 2201 - 26 12/18/08 meet in order to comply with this rule or any other applicable District rules. The preliminary determinations con tained in the report shall be as specific as possible within the constraints of the information contained in the NOI. 5.8.2 Equivalency of Application for Certification to Application for Authority to Construct: The APCO shall consider an Application for Certification (AFC) to be equivalent to an application for an Aut hority to Construct, and subject, as such, to all definitions and requiremen ts of this rule. 5.8.3 Upon receipt of an AFC for a power plant, the APCO shall conduct a Determination of Compliance review. This review sh all determine whether an AFC is complete, and within 20 calendar days of receipt of the AFC, the APCO shall so inform the California Energy Commissi on and the applicant in writing. 5.8.3.1 If the APCO determines that the application is not complete, the information required shall be specified, and the AF C shall be returned to the applicant for resubmittal. Upon re ceipt of any resubmittal of the application, a new 20 day period to determine completeness shall begin. 5.8.3.2 Completeness of an application or resubmitt ed application shall be evaluated on the basis of the information requireme nts set forth in District Rules and Regulations as they exist on the date on which the application or resubmitted application is recei ved. 5.8.4 The APCO may request from the applicant any i nformation necessary for the completion of the Determination of Compliance r eview. If the APCO is unable to obtain the information, the APCO may peti tion the presiding Commissioner of the California Energy Commission fo r an order directing the applicant to supply such information. 5.8.5 Within 180 days of accepting an AFC as comple te, the APCO shall make a preliminary written decision as to whether a Determ ination of Compliance Certification should be approved, conditionally app roved, or disapproved. The APCO shall deny any Determination of Compliance Certification if the APCO finds that the subject of the application woul d not comply with the standards set forth in this rule or any other Distr ict rule. The decision shall be supported by a succinct, written analysis.

5.8.6 Notification and Publication actions shall be conducted according to the requirements of Section 5.5. 5.8.7 Within 240 days after acceptance of an applic ation as complete, the APCO, after considering all written comments, shall take final action on the application, which action shall consist of the foll owing:SJVUAPCD 2201 - 27 12/18/08 5.8.7.1 The APCO, if all requirements of this rule are met, shall issue and submit to the California Energy Commission a Determ ination of Compliance, or advise the Commission that a Determi nation of Compliance cannot be issued. 5.8.7.2 Public inspection of final action documents shall be provided for in accordance with Section 5.5.6 5.8.8 Equivalency of Determination of Compliance to Authority to Construct: A Determination of Compliance shall confer the same r ights and privileges as an Authority to Construct provided that the Califor nia Energy Commission approves the Application for Certification and the certificate granted by the Commission includes all conditions of the Determina tion of Compliance. 5.8.9 The APCO shall issue a Permit to Operate to a ny applicant receiving a certificate from the California Energy Commission p ursuant to this rule provided that the construction or modification is i n compliance with all conditions of the certificate and of the Determinat ion of Compliance, and provided that the Permit to Operate includes the co nditions prescribed in Section 5.7. 5.9 Enhanced Administrative Requirements Application for a certificate of conformity with t he procedural requirements of 40 CFR Part 70 shall be subject to the following enhan ced administrative requirements in addition to any other applicable administrative requirements of Section 5.0: 5.9.1 New Sources and Significant Permit Modificati ons 5.9.1.1 Public Notification: The APCO shall provid e a written notice of the proposed permit and, upon request, copies of th e APCO analysis to interested parties. Interested parties shall include affected states, ARB and persons who have requested in writing to be notified. The notice shall also be given by pub lication in a newspaper of general circulation in the District an d by any other means if necessary to assure adequate notice to the affected public. The public shall be given 30 days from the date of publication to submit written comments on the APCO' s proposed action. 5.9.1.2 The notice shall provide the following info rmation: 5.9.1.2.1 The identification of the source, the nam e and address

of the permit holder, the activities and emissions change involved in the permit action;
5.9.1.2.2 The name and address of the APCO, the nam e and

telephone number of District staff to contact forSJVUAPCD 2201 - 28 12/18/08 additional information; 5.9.1.2.3 The availability, upon request, of a stat ement that sets

forth the legal and factual basis for the proposed permit conditions; 5.9.1.2.4 The location where the public may inspect the

Complete Application, the APCO's analysis, the proposed permit, and all relevant supporting materi als; 5.9.1.2.5 A statement that the public may submit wr itten

comments regarding the proposed decision within at least 30 days from the date of publication and a br ief description of commenting procedures, and 5.9.1.2.6 A statement that members of the public ma y request

the APCO or his designee to preside over a public hearing for the purpose of receiving oral public comment, if a hearing has not already been schedule d. The APCO shall provide notice of any public hearing scheduled to address the proposed decision at least 30 days prior to such hearing; 5.9.1.3 The APCO shall provide written response to persons or agencies that submitted written comments which are postmarke d by the close of the public notice and comment period. All written comments and responses to such comments shall be ke pt on file at the District office and made available upon request

. 5.9.1.4 A copy of the Complete Application, the APC O's analysis and the proposed permit shall be made available at District offices for public review and comment during normal business ho urs. The APCO's analysis shall include a statement that sets forth the legal and factual basis for the proposed permit condition s, including references to the applicable statutory and regulato ry provisions. 5.9.1.5 The APCO shall provide written notice to th e EPA of the proposed decision along with copies of the proposed permit, the APCO's analysis, the public notice submitted for pu blication, and all necessary supporting information. 5.9.1.6 If the EPA does not object pursuant to Sect ion 5.9.1.9, the APCO shall issue the final permit. 5.9.1.7 If the EPA does not object in writing to th e APCO's preliminary decision during the EPA's 45 day review period, any person may petition the EPA within 60 days after the expiratio n of the EPA's 45 day review period. Any such petition shall be b ased only onSJVUAPCD 2201 - 29 12/18/08 objections to the permit that were raised with reas onable specificity during the public comment period, unles s the petitioner demonstrates to the EPA that it was impracticable t o raise such objections within such period, or unless grounds fo r such objections arose after such period. Petitions shall be based on the compliance of the permit provisions with applicable requirements. 5.9.1.8 Within 180 days after acceptance of an appl ication as complete, or within 180 days after the lead agency has approved the project under the California Environmental Quality Act, whi chever occurs later, the APCO shall take final action on the appl ication after considering all written comments. 5.9.1.9 The APCO shall not issue a permit if the EP A objects to its issuance in writing within 45 days of receipt of th e APCO's notice of preliminary decision on the proposed permit. 5.9.1.9.1 Any EPA objection shall include a stateme nt of the

EPA's reasons for objection and a description of th e terms and conditions that the permit must include t o respond to the objections. The EPA shall provide t he permit applicant a copy of the objection. 5.9.1.9.2 If the APCO fails, within 90 days after t he date of

EPA's objection, or within 180 days from the date t he application was deemed complete plus any extension allowed by the state law, whichever is sooner, to r evise and submit a proposed permit in response to the objection, the APCO shall not issue a certification on conformity to Title V. 5.9.1.9.3 If the EPA objects to the permit as a res ult of a public

petition, the APCO shall not issue the permit until EPA's objection has been resolved, except that a petition for review does not stay the effectiveness of a permit or its requirements if the permit was issued after the end of the 45-day review period and prior to an EPA objection. If the APCO has issued a permit pri or to receipt of an EPA objection, the EPA will modify , terminate, or revoke such permit, and shall do so consistent with procedures in Section 70.7(g)(4) or (5)(i) and (ii) of the 40 CFR regulations, and the APCO may thereafter reissue only a revised permit that satisfies EPA objection. 5.9.1.9.4 EPA objection shall be limited to complia nce with

applicable requirements and the requirements of 40SJVUAPCD 2201 - 30 12/18/08 CFR Part 70.

5.9.2 Minor Permit Modifications 5.9.2.1 Within 5 working days after the receipt of a Complete Application for a minor permit modification, the APCO shall pro vide notification of the proposed permit modification to the EPA, affected states, and interested parties pursuant to Section 5.9.1.1. 5.9.2.2 The APCO shall not issue a final permit mod ification until after a 45-day period review of the proposed permit modific ation by EPA or until EPA has notified the APCO that EPA will no t object to issuance of the permit modification, whichever is f irst. 5.9.2.3 Within 90 days after APCO's receipt of an a pplication for a minor permit modification or 15 days after the end of the EPA's 45-day review, whichever is later, the APCO shall do one o f the following: 5.9.2.3.1 Issue the permit as proposed; 5.9.2.3.2 Deny the permit modification application; 5.9.2.3.3 Determine that the requested modification does not

meet the minor permit modification criteria and sho uld be reviewed pursuant to the administrative requirements for significant permit modifications; or 5.9.2.3.4 Revise the draft permit modification and transmit the

new proposed permit modification to EPA and the affected states. 6.0 Certification of Conformity A new or modified source subject to the requirement s of Rule 2520 may choose to apply for a certificate of conformity with the procedural requirements of 40 CFR Part 70. A certification of conformity will allow changes auth orized by the Authority to Construct to be incorporated into the Part 70 permit as administ rative permit amendments.

6.1 The APCO will issue a written certificate of co nformity with the procedural requirements of 40 CFR 70.7 and 70.8, and with the compliance requirements of 40 CFR 70.6(8)(c), if the following conditions are met : 6.1.1 The Authority to Construct is issued in confo rmance with the Enhanced Administrative Requirements of this rule; 6.1.2 The content of the Authority to Construct iss ued by the APCO complies with the requirements set forth in Section 9.0 of D istrict Rule 2520SJVUAPCD 2201 - 31 12/18/08 (Federally Mandated Operating Permits); 6.1.3 An application for a certificate of conformit y with the requirements of 40 CFR Part 70 is submitted with the application for A uthority to Construct. The content of application for the certificate of c onformity must comply with the requirements of Sections 7.1 of District R ule 2520 (Federally Mandated Operating Permits); 6.1.4 The Authority to Construct contains a stateme nt of conformity with the requirements of Title V and 40 CFR Part 70; 6.1.5 EPA has not objected to the issuance of the A uthority to Construct, or EPA's objections have been resolved to the satisfac tion of EPA administrator; and 6.1.6 The Part 70 operating permit being issued wil l contain the federally enforceable requirements contained in the Authority to Construct. 6.2 The certificate of conformity with the procedur al requirements of 40 CFR Part 70 is valid as long as the Authority to Construct with wh ich it was issued is valid. 6.3 Modifications to an Authority to Construct for which a certificate of conformity has been issued are subject to the administrative requi rements of Section 11.0 of District Rule 2520 that apply to permit modificatio ns and changes, as well as the requirements of all District Rules that apply to mo difications of Authorities to Construct.SJVUAPCD 2201 - 32 12/18/08

7.0 Annual Offset Equivalency Demonstration and Pre -baseline ERC Cap Tracking System 7.1 Offset Tracking System The APCO shall implement a system for tracking the following for each permitting action: 7.1.1 The quantity of offsets that would have been required for new major sources and federal major modifications in the District had the federal new source review requirements, codified in 40 CFR 51.165, and Title I part D of the Clean Air Act (CAA), been applied to these sources. These requirements include offsetting the full emissions from new majo r sources, using actual emissions baselines when required under 40 CFR 51.1 65, and providing offsets necessary to meet the CAA offset ratio requ irements and provide a net air quality benefit. 7.1.2 The quantity of offsets actually required for all new and modified sources in the District pursuant to the requirements of this r ule, and, for the purposes of the Pre-baseline ERC Cap Tracking System outline d in any Districtadopted and EPA-approved attainment plan. 7.1.3 The surplus value of creditable emission redu ctions used as offsets by stationary sources. 7.1.3.1 The surplus value shall be determined at th e time of ATC issuance for the sources using the emission reductions to sa tisfy offset requirements of this rule. 7.1.3.2 The determination of surplus value shall sp ecify all requirements that apply to the offsets being reviewed, the metho dology used to calculate the impact of these requirements, and all calculations performed in arriving at the final surplus value. 7.1.4 For purposes of the requirements of Section 7 .0, surplus value shall be defined as the quantity of actual emission reductio ns achieved by a source in excess of the following requirements: 7.1.4.1 Any emission reduction required by a stand- alone federal requirement or regulation, including, but not limit ed to, Acid Rain, New Source Performance Standard, Reasonably Availab le Control Technology, and Maximum Achievable Control Technolo gy, whether or not the requirements are part of the Sta te Implementation Plan (SIP) or a local attainment pla n. 7.1.4.2 Any emission reduction relied upon by a per mitting authority for attainment purposes, such as through an attainment plan, including emission reductions relied upon for Reasonable Furt her Progress calculations.SJVUAPCD 2201 - 33 12/18/08 7.1.4.3 Any emission reduction achieved by shutting down an existing source or curtailing production or operating hours below baseline levels whose original emission is not included in t he District’s emission inventory. 7.1.4.4 Any emission reduction based on a source-sp ecific or source category-specific SIP provision used to comply with CAA requirements. 7.1.4.5 Any emission reduction required by a condit ion of a permit issued to comply with CAA New Source Review requirements, except that any emission reduction required by a permit co ndition, which was placed on a permit solely to assure compliance with a state or local requirement, which is not on its own federall y enforceable, shall not be included in this class. 7.1.4.6 Any emission reduction based on a source-sp ecific emission limitation resulting from an EPA enforcement case. 7.1.5 For purposes of the requirements of Section 7 .0, creditable shall be defined as emission reductions are real, surplus, quantifia ble, enforceable and permanent. The creditability of a given emission r eduction may be subject to review by the EPA. 7.2 Annual Demonstration Report The APCO shall annually prepare a report with the f ollowing demonstrations to be provided to the public, the ARB and the EPA in acco rdance with the dates specified in Section 7.3. The District shall also make avail able to the public, the ARB and the EPA the data used to prepare the demonstrations

. 7.2.1 Demonstration on Equivalency of Offset Requir ements 7.2.1.1 The report shall include a comparison of th e annual quantity of federal offsets that would have been required (as t racked pursuant to Section 7.1.1) to the annual quantity of offsets actually required under this rule, including any excess offsets requi red from previous reporting years (as tracked pursuant to Se ction 7.1.2). 7.2.1.2 The report shall also describe any addition al emission reductions retired to address a shortfall in required offsets as specified in Section 7.4.1.1. Such description shall, at a mini mum, specify the emission reductions used and the surplus value of t hose reductions. The surplus value of these reductions m ay also be used in demonstrating equivalency under section 7.2.2 7.2.2 Demonstration on Creditability of Emission Re ductionsSJVUAPCD 2201 - 34 12/18/08 7.2.2.1 The report shall include a comparison of th e annual quantity of federal offsets that would have been required (as t racked pursuant to Section 7.1.1) to the surplus value of creditabl e emission reductions used as offsets during the year (as trac ked pursuant to Section 7.1.3). 7.2.2.2 For purposes of the demonstration described in Section 7.2.2, the comparison may also include the surplus value of ad ditional creditable emission reductions that have not been u sed as offsets and have been banked or have been generated as a re sult of permitting actions. The surplus value of these redu ctions may also be used to remedy any shortfall as specified under Section 7.4.1.1. 7.2.2.2.1 The surplus value of these additional cre dits shall be

determined as of the date of the issuance of the Authority to Construct utilizing such reductions in demonstration described in this subsection. 7.2.2.2.2 Any such additional emission reductions u sed in this

demonstration shall be permanently retired and shal l not be used to meet any offset or netting requireme nts and shall not be used in future demonstrations requ ired by Section 7.0.

7.2.2.2.3 Additional emission reductions described in Section

7.2.2.2 shall only be included in the comparison to the extent the annual quantity of federal offsets that would have been required (as tracked pursuant to Section 7.1.1) exceeds the surplus value of creditable emis sion reductions used as offsets (as tracked pursuant to Section 7.1.3). 7.2.2.2.4 Any additional emission reductions descri bed in

Section 7.2.2.2 that are not included in the demonstration required by this subsection, may be used in future demonstrations in accordance with th is subsection.SJVUAPCD 2201 - 35 12/18/08

7.3 Reporting Schedule 7.3.1 The report shall cover the period August 20 t o August 19 of each year. For the Initial report, the District shall track offset requirements for new and modified sources for which a complete application f or Authority to Construct was submitted after August 20, 2001. Add itional emission reductions, other than banked emission reductions, may be used in the equivalency demonstration only if the reduction occ urred after August 20, 2001 7.3.2 For each reporting period, the APCO shall sub mit the report and data described in Section 7.2 to ARB and the EPA no late r than November 20 of each year. In addition, the APCO shall release the report to the public and shall present it to the District Governing Board, e ach year, at the first Board meeting following its submittal to the EPA. 7.3.3 All documents created and/or used in implemen ting the requirements of Section 7.0 shall be kept and maintained by the APC O for no less than five years from the date of their creation and/or use. 7.4 Remedy for Emission Offset Shortfalls 7.4.1 Failure to Demonstrate Equivalency in Offset Requirements 7.4.1.1 If the comparison described in Section 7.2. 1 does not show, or EPA determines the comparison erroneously shows, th at the annual quantity of offsets actually required under this rule (as tracked pursuant to Section 7.1.2) equals or exceed s the annual quantity of federal offsets that would have been re quired (as tracked pursuant to Section 7.1.1), the District sh all retire additional creditable emission reductions that have not been used as offsets and have been banked or have been genera ted as a result of permitting actions such that the surplus value o f these emission reductions satisfies any shortfall. 7.4.1.1.1 The surplus value of these additional cre dits shall be

determined as of the date of the issuance of the Authority to Construct utilizing such reductions in demonstration described in this subsection. 7.4.1.1.2 Any such additional emission reductions u sed in this

demonstration shall be permanently retired and shal l not be used to meet any offset or netting requireme nts and shall not be used in future demonstrations requ ired by Section 7.0.

7.4.1.2 If the District does not have sufficient ad ditional creditable emission reductions to satisfy the shortfall descri bed in 7.4.1.1, allSJVUAPCD 2201 - 36 12/18/08 ATCs issued after the report deadline for that year shall comply with the offset requirements of 40 CFR 51.165, and part D of Title I of the CAA, for each pollutant for which there is a shortfall, until the applicability and offset requirements of this r ule are revised to comply with the federal new source review requireme nts and approved into the SIP by EPA. 7.4.1.3 If the APCO fails to submit a report meetin g the requirements of Section 7.2.1, all ATC issued after the report dead line and until the APCO submits to ARB, EPA and the public a repor t complying with the requirements of Section 7.2.1 sh all comply with the offset requirements of 40 CFR 51.165, and part D of Title I of the CAA. 7.4.2 Failure to Demonstrate Adequate Creditable Em ission Reductions 7.4.2.1 If the comparison described in Section 7.2. 2 does not show, or EPA determines the comparison erroneously shows, th at the surplus value of creditable emission reductions use d as offsets during the year (as tracked pursuant to Section 7.1 .3) combined with additional emission reductions as described in Section 7.2.2.2 equals or exceeds the annual quantity of federal of fsets that would have been required (as tracked pursuant to Section 7.1.1), all ATCs issued, for new major sources or federal major modifications, for each pollutant for which there i s a shortfall, after the report deadline shall ensure that emissio n reductions used to satisfy offset requirements are creditable and t hat the surplus value of those credits is determined at the time of ATC issuance. 7.4.2.2 The requirements of Section 7.4.2.1 shall r emain in effect until this rule is revised to require offset discounting at time of use and such revision is approved into the SIP by EPA, or u ntil a subsequent annual report prepared in accordance wit h Section 7.2.2 demonstrates that the surplus value of credit able emission reductions used as offsets (as tracked pursuant to Section 7.1.3) combined with additional emission reductions as des cribed in Section 7.2.2.2 equals or exceeds the annual quanti ty of federal offsets that would have been required (as tracked p ursuant to Section 7.1.1). 7.4.2.3 If the APCO fails to submit a report meetin g the requirements of Section 7.2.2, all ATCs issued for new major source s or federal major modifications after the report deadline and u ntil the APCO submits to ARB, EPA and the public a report complyi ng with the requirements of Section 7.2.1 shall ensure that emi ssion reductions used to satisfy offset requirements are creditable and that the surplus value of those credits is determined at the time of ATCSJVUAPCD 2201 - 37 12/18/08 issuance. 7.5 Pre-Baseline ERC Usage Caps from District Attai nment Plans 7.5.1 ERCs that were banked prior to the baseline y ear for a given Districtadopted and EPA-approved Attainment Plan shall not be used to offset emissions increases under the provisions of this ru le if the usage of such credits during the effective period of the plan exc eeds the respective pollutant’s Pre-Baseline ERC Usage Cap in the plan. 7.5.2 Such caps on pre-baseline ERC usage remain in effect until the end of the plan’s effective period, or until such time as EPA approves revised caps through an Attainment Plan revision process or a Ra te of Progress update. 8.0 Application Shield for Routine Replacement 8.1 For a Routine Replacement for which an Authorit y to Construct is required, the permitted source may continue to operate under an a pplication shield, provided that all of the following conditions are met. 8.1.1 An application for the Routine Replacement ha s been submitted within seven calendar days of completing the routine repla cement. 8.1.2 The source operates in compliance with all ap plicable requirements of the federal, state, and District rules and regulations. 8.2 When the application has been deemed complete b y the APCO, the application shield shall be made effective retroactive from the date of application submittal until the application is either approved or denied, 8.2.1 The application shield is not applicable if t he District's final action is delayed due to the failure of the applicant to subm it timely information requested by the District. The source must also su bmit additional information for any requirements that become applic able after a complete application is submitted, but before a PTO is issue d. 8.3 The application shield does not exempt the oper ator from any applicable requirements. 8.4 The application shield applies only to an appli cation for a Routine Replacement and does not authorize any increases to the permitted t hroughput or emissions due to a change in design capacity as part of a Routine Repl acement.