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### Document

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# 88 ) ll-C-4 6 Docket Number: 

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# A"~* ' TI-C-4 6

ite* : «r 4 . ? ar m ^ %. . .cT ' u «K*** ° UNITE D STATE S ENVIRONMENTA L PROTECTIO N AGENC Y WASHINGTON , D.C . 20460

OFFIC E O F AI KAN O RADIATIO N MA Y3 I 135 5

Mr . Willia

m H . Lewi s Morgan , Lewi s an

dBockiu s 180 0 M Street , N.W . Washington , D.C . 200 3 6-586 9 Dea r Mr . Lewis : A s youknow , th

e Environmenta l Protectio nAgency

(EPA ) i s committedt o working wit hindustr y an dothe r stakeholder s t o developflexibl e solution s t o addres s th e implementatio

nconcern s raise dwit hou r programs . Thank s ina large par t t o your initiative , we wer e abl e t o hol da successfu l meeting wit hyo u an dove r 5 5 o f you r colleague s t o discus s implementatio nissue s o f concern . I a

m providin

g our response s t o the issue s raise db y the industr

y representative s a t the Apri l 12 , 199 5 meeting . Th e EP A ha s made considerabl e progres s i ndevelopin g rule s an dguidanc e tha t tak e int o consideratio nman y o f you r concerns . Severa l o f the concern s youraise dar e bein

g addressedi n rulemakin

g package s tha t ar e underwa y for ne w sourc e revie

w refor m an doperating permits . I naddition , w e ar e holdin g stakeholde r meeting s o nenhancedmonitorin g an dsectio

n112(g) . EP A i s als o developin g guidanc e insevera l area s tha t wil l hel p clarif y a numbe r o f th

e uncertaintie s tha t hav e bee nraise

di n the industr

y comments . I look forwardt o continue workin g wit hyo

ua s w e move forwar dindeveloping rule s tha t wor k for al l partie s an d foremos t i nachievin g cleanai r for al l our/Citizens ,

Sihce r 

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ENVIRONMENTAL PROTECTIO N AGENC Y (EPA )

RESPONS E TO ISSUE S RAISE D B Y INDUSTR Y O N CLEAN AI RAC T IMPLEMENTATIO N REFOR M

Ma y 30 , 199 5P. 4

TABL E O F CONTENT S
EPA' S RESPONS E T O ISSUE S RAISE D BYINDUSTR

YO N CLEA N AI RAC T IMPLEMENTATIO N REFOR M Pag e Summar y o f EP A Effort s 3
EP A Respons e to Specifi c Issue s Operatin

g Permi t Progra

m 6
Ne w Sourc e Review . 1 3 Ai r Toxic s 2 7
EnhancedMonitoring . .4 0 Potentia l to Emit. . , 4 3 Fugitiv e Emissions , .. , 4 6 * • •

- AP. 5

EPA' S RESPONS E T O INDUSTR Y CONCERN S ON CLEA NAI R AC T IMPLEMENTATIONREFORM O n Apri l 12 , 1995 , EP Ame t wit h 5 5 industryrepresentative s t o discus s issue s the yha d raise d and t o indicat e wha t action s EP Aintend s t o tak e o n th e issues
. Th e specifi c issue s raise d b y th e variou s industryrepresentative s and EPA' s response s t o thos e issue s ar e attached . Th e vas t majorit yo f issue s raise d b y industrywer e no t ne wt o EPA ; th e Agenc yha s bee n workin g wit h industryrepresentative s and othe r stakeholder s fo r severa l month s tryin g t o fin d cost-effective , commo n sens e solution s t o thes e ofte n comple x issues
. I t i s als o importan t t o not e tha t th e response s include d i n thi s documen t reflec t th e Agency' s position s a s o f mid-Ma y1995 . O n severa l o f thes e issues , notabl yoperatin g permit s and 112(g) , EP Ai s i n th e mids t o f reevaluatin g it s program s i n ligh t o f ^m recen t feedbac k fromvariou s stakeholders . I n Jun e 199 5 EP Awil l mee t wit h th e Clea n Ai r Ac t Advisor yCommitte e t o discus s option s fo r addressin g sectio n 112(g) . EP Ai s als o currentl yworkin g ou t fina l detail s o f a propose d supplementa l rul e o n operatin g permit s an

d wil l shortl ymak e availabl e additiona l informatio n abou t tha t proposal . Enhance d Monitorin g I n general , EP Aagree s wit h concern s raise d abou t th e enhance d monitorin g rul e an d ha s withdrawn th e packag e from revie wb

yth e Offic e o f Managemen t and Budget . EP Ahope s t o develo p a strategytha t wil l allo wi t t o issu e complianc e assuranc e requirement s tha t buil d o n th e requirement s o f existin g rule s an

d ensur e tha t th e environmenta l result s expecte d fro m thos e rule s ar e bein g achieved
. EP Areceive d a n extensio n o f th e court-ordere d deadlin e unti l Jun e 30 , 1995 . EP Aintend s t o see k a furthe r extensio n o f a t leas t a yea r t o allo wtim e fo r stakeholde r involvemen t i n developmen t o f th e rule . On e o f th e firs t step s EP Awil l tak e i s t o hol d a stakeholders ' meetin g o n Ma y31 , 1995 . EP Awil l wor k wit h representative s fro mindustry , states , and environmenta l group s t o obtai n thei r assistanc e i n developin g a ne wflexibl e approac h fo r th e enhance d monitorin g rule . Operatin g Permi t Program Ove r th e nex t mont h EP Aplan s t o mak e severa l significan t improvement s t o th e permi t programtha t wil l enhanc e a facility' s abilit yt o mak e proces s o r operationa l change s withou t revisin g it s Titl e V

permit , mak e fa r greate r us e o f existin g Stat e permi t program s fo r purpose s o f Titl e V , and reduc e th e cost s and burden s o f developin g permi t applications
. Som e o f thes e change s ar e describe d below . EP Aintend s t o mak e availabl e informatio n abou t th e othe r change s shortly .P. 6 

### V I n th e las t severa l month s EP Aha s bee n workin g wit h representative s fromindustry , states , an d environmenta l group s t o fin d a solutio n tha t wil l allo wa mor e streamline d proces s fo r permi t revision s an d provid e mor e flexibilit yt o state s and industry
. EP Aplan s t o issu e a supplementa l propose d rul e o n operatin g permi t revision s i n Jun e 1995 . EP Aha s alread yshare d a draf t o f th e supplementa l proposa l wit h industry , state s and othe r stakeholder s t o ge t thei r comment s o n th e revise d approach .
EP Ai s currentl yi n th e proces s o f workin g ou t fina l detail s abou t wha t wil l b e i n th e supplementa l proposal , s o i t i s no t possibl e t o full ydescrib e th e exten t o f th e change s i n tha t documen t here . However , i n genera l th e supplementa l proposa l wil l includ e a streamline d syste mfo r permi t revision s tha t build s o n existin g successfu l Stat e programs . Unde r thi s process , State s woul d hav e greate r flexibilit yt o decid e th e amoun t o f publi c revie wand EP Arevie wfo r mos t permits , by matchin g th e leve l o f revie wt o th e environmenta l significanc e o f th e changes . AStat e woul d no t b e require d t o provid e an yEP Ao r publi c revie wfo r change s tha t i t ca n sho war e d e minimis
. EP Ai s als o workin g o n a serie s o f guidanc e document s tha t wil l addres s man

yimplementatio n issue s raise d b yindustryand states . Thi s guidanc e i s expecte d t o clarif yth e flexibilit y allowe d unde r th e curren t rul e an d provid e guidanc e o n way s t o reduc e th e cost s an d effor t i n preparin g permi t applications , whic h i n tur n wil l reduc e th e administrativ e an d economi c burden s o f thi s program , A s a resul t o f concern s abou t th e siz e and cos t o f som e permi t application s tha t hav e recentl ycome t o EPA' s attention , th e Agenc yplan s t o hol d meeting s wit h industryand Stat e stakeholder s i n Jun e t o clarif yth e requirement s o n permi t applicatio n conten t and ensur e tha t Stat e o r loca l agencie s d o no t reques t needles s informatio n i n th e applications
. Ne wSourc e Revie w EP Aha s worke d through th e Clea n Ai r Ac t Advisor yCommitte e t o obtai n independen t advic e and counse l o n polic yand technica l issue s associate d wit h reformin g th e Ne wSourc e Revie wprogram . Throug h thes e efforts , EP Aprovide d a draf t NS R reformrul e fo r stakeholders ' commen t i n 1994 . Base d o n inpu t receive d from th e industry , states , environmenta l and othe r groups , EP Aha s revise d th e draf t rul e an

d intend s t o propos e th e reformrul e i n Jul y 1995 . Th e propose d revision s provid e stakeholder s wit h mor e certaint yand flexibilit yt o compl ywit h EPA' s NS R requirements , and promot e th e us e o f innovativ e contro l technologie s and pollutio n preventio n Whil e EP Aview s the . NS R proposa l packag e a s bein g balance d and a s no t sacrificin g environmenta l protection , thi s packag e provide s industrywit h severa l importan t benefits
. T o nam e jus tP. 7

a few , EPAplan s t o exemp t certai n "clean " emissio n units , an d pollutio n contro l an d pollutio n preventio n project s fromNS R altogether . EP Aals o plan s t o provid e a n approac h tha t promote s voluntaryus e o f plant-wid e applicabilit ylimit s whic h allow s industryt o operat e withou t change s t o its ' permi t a s long a s th e plant' s emission s d o no t excee d a cap . Ai r Toxic s EP Arecognize s tha t state s and industrynee d lea d tim e t o b e abl e t o implemen t th e modificatio n provision s containe d i n sectio n 112(g) . EP Apublishe d a n interpretiv e notic e i n February 199 5 advisin g state s tha t the yar e no t require d t o implemen t th e modificatio n provision s unti l EP Aissue s th e fina l rule . Thi s reverse d a n earlie r EP Alega l interpretation
. I n developin g th e fina l sectio n 112(g ) rule , EP Awil l conside r th e nee d fo r additiona l lea d tim e t o implemen t th e modificatio n provision s following promulgatio n o f th e rule . I n respons e t o comment s receive d o n th e propose d rule , EP A i s considerin g makin g severa l significan t changes . EP Aplan s t o discus s thes e propose d change s a t th e Jun e meetin g o f th e Clea n Ai r Advisor yCommitte e meeting
. A s i t develop s th e fina l rule , EP Aplan s t o hol d meeting s wit h industry , state s and othe r stakeholder s abou t potentia l change s t o th e propose d rule . EP A plan s t o issu e th e fina l rul e i n earl y1996 . Potentia l t o Emi t EPA' s requirement s fo r a source' s limit s o n it s potentia l t o emi t t o b e federall yenforceabl e i s currentl yi n litigation
. I n tha t litigatio n EP Aha s take n th e positio n tha t i t ha s th e lega l authorit yt o requir e federa l enforceability
. EP Abelieve s ther e shoul d b e a credibl e syste mt o ensur e adherenc e t o restriction s whic h allo wa sourc e t o avoi d federa l requirements
. Federa l enforceabilit yprovide s EP Ath e opportunit yt o ensur e compliance ; i t als o provide s citizen s th e opportunit yt o ensur e tha t source s i n thei r communitie s ar e takin g step s t o reduc e toxi c ai r pollution
. I n Januar y1995 , EP Aissue d a memorandu moutlinin g alternativ e way s tha t restriction s o n potentia l t o emi t coul d b e les s burdensome . Fo r example , EP Aidentifie d approache s suc h a s genera l rule s and genera l permit s t o creat e restriction s o n larg e number s o f source s withou t havin g t o resor t t o individua l permits
. T o ensur e tha t state s hav e sufficien t tim e t o implemen t thes e approaches , EP Aprovide d a two-yea r transitio n period
. Durin g th e transitio n period , source s emittin g les s tha n 5 0 percen t o f th e majo r sourc e threshol d woul d b e exclude d fro m havin g federall yenforceabl e limitations , a s lon g a s appropriat e record s ar e kept . Source s abov e th e 5 0 percen t threshol d tha t hav e Stat e permi t limit s ca n simpl ysubmi t certification s tha t^ 8
_

accep t thei r Stat e limit s a s federall yenforceable . EP Ai s givin g seriou s consideratio n t o extending th e provisio n fo r source s emittin g les s tha n th e 5 0 percen t cutof f beyond th e two
yea r period
. Fugitiv e Emission s EP Acontinue s t o conduc t sectio n 30 2 (j ) rulemaking s wher e require d unde r th e Act , bu t believe s sectio n 11 2 doe s no t requir e suc h a rulemaking
. Acour t decisio n o n th e lega l issu e o f whethe r suc h rulemakin g i s require d unde r sectio n 11 2 i s expecte d t o b e issue d shortly . EPAi s intereste d i n specifi c concern s abou t th e technica l feasibilit yo f measurin g fugitiv e hazardou s ai r pollutan t emissions , and i n providin g guidanc e i n thi s area . EP Aha s committe d t o issu e guidanc e i n Ma y199 5 o n treatmen t o f co-locate d source s o f fugitiv e emission s tha t hav e no t bee n liste d unde r sectio n 30 2 (j)
. • \P. 9

V
I EPA' S RESPONS E T O ISSUE S RAISED BYINDUSTR YO N CLEA N AI RAC T IMPLEMENTATIO N REPOR M Operatin

g Permi t Progra

m REDUCIN G PERMI T APPLICATIONBURDEN S Issue 1 : T o reduc e th e burdeno f th

e permi t application , EPA shoul dissue guidanc e t o confir m tha t source s ar e no t requiredto include a substantia l leve l o f detai l i n thei r permi t applications . Specificall y coveredshoul d b e limitin

g detai l o

nemission s an

dreviews relatedto identificatio

no f applicabl e requirements . Response :

• EP Aagree s and i s creating guidanc e o n thi s and manyothe r implementatio n issues
.

• EPA' s guidanc e wil l addres s th e exten t t o whic h emission s mus t b e quantifie d fo r purpose s othe r tha n determinin g a facility' s potentia l emissions
. EP Awil l clarif ytha t extensiv e emissio n inventorie s ar e no t th e mai n goa l o f th e Titl e V operatin g permi t program , and tha t documentatio n o f emission s ma yb e reduce d wher e th e purpos e i s fo r catalogin g emission s rathe r than , fo r example , determinin g whethe r a Stat e o r federa l rul e applies
.

• EP Awil l clarif ytha t emission s o f ver ysmal l amount s o f pollutant s coul d b e reporte d a s presen t i n "trace " amounts , instea d o f calculatin g th e actua l quantit yo f emissions
. Th e guidanc e wil l clarif ytha t calculatio n o f ton s pe r yea r emission s o f pollutant s covere d unde r th e accidenta l releas e program[sectio n 112(r) ] i s no t required , unles s th e pollutan t i s als o a hazardou s ai r pollutan t (HAP ) unde r th e ai r toxic s provision s i n sectio n 112(b) .

• Althoug h no t par t o f industry' s recommendation , anothe r mean s o f reducin g th e burde n o f permi t application s i s t o allo wpar t o f a n applicatio n t o b e submitte d withi n th e on e yea r deadlin e and th e remainin g informatio n t o b e submitte d neare r th e dat e o f permi t issuanc e fo r source s whos e require d dat e fo r permi t issuanc e i s significantl ylate r i n th e state' s 3-yea r transitio n period
. EP Awil l clarif ytha t permi t authoritie s ma yinitiall ydee m a n applicatio n complete , provide d cor e informatio n i s included , an d the n allo wsubmitta l o f additiona l necessar yinformatio n neare r th e dat e o f permi t issuance
. Th e applicatio n shiel d wil l continu e t o b e provide d t o application s deeme d complet e i n thi s manner .P.1 0

UPDATE D EMISSION S ESTIMATE S Issu e 2 : EP A

shoul dissu e guidanc e that , a t a minimum , establishe s th e following : 1 ) I f emission s estimate s develope di npreparin g Titl e V application s diffe r fro m prio r goo dfait hestimates , the nus e o f th e prio r estimate s shoul dno t b e calle d int o questio nb y

th e ne w

estimates , an d 2 ) I f emissionlimit s wer e base donprio r goo dfait h estimate s tha t ar e lowe r tha ncurren t estimates , the n th e previou s emissionlimit s ma y b e revise dusin g th e Titl e V

permi t proces s t o reflec t estimate s base don curren t methodologies . Response : EP Arecognize s th e nee d fo r fai r an d appropriat e measure s unde r thes e circumstances
. EP Ai s developin g guidanc e o n wha t effec t ne wemissio n factor s o r informatio n woul d hav e o n a previousl ysubmitte d permi t application
. Thi s guidanc e i s expecte d t o b e issue d ver yshortly . EP Aagree s tha t goo d fait h estimate s ar e a n importan t facto r i n thi s issue
. EP Ai s solicitin g comment s fro mindustr yo n ho wi t shoul d addres s th e issu e o f "goo d faith " estimates
. EP Aals o agree s tha t change s t o emissio n estimate s shoul d no t requir e a revisio n o f th e operatin g permi t i f th e ne w estimat e ha s n o affec t o n wha t requirement s apply . I f ne w requirement s apply , th e existin g rul e define s th e procedure s fo r incorporatio n int o th e permit
. INSIGNIFICAN T ACTIVITIE S Issu e 3 : EP A

shoul dallo w

State s t o exclud e a s insignifican t activitie s any

unit s wit hemission s belo w th e State establishe dsignificanc e threshold s - - eveni f th e unit s ar e subjec t t o a napplicabl e requirement . Response : EP Awil l provid e additiona l guidanc e t o State s concernin g exclusio n o f certai n activitie s fro mth e obtainin g a permit ,P.1 1

• EP Awil l clarif ythrough guidanc e tha t State s ma yreduc e th e leve l o f informatio n i n th e applicatio n fo r activitie s subjec t t o a genericall yapplicabl e Stat e implementatio n pla n (SIP ) requirement , suc h a s smal l unit s subjec t t o genera l SI P opacit yrequirements
. MINO R NE W SOURC E REVIEW/TITL E I MODIFICATION S Issue 4 : EP

A shoul dimmediatel y issu e a rulin

g tha t Titl e I modification s include onl y change s explicitl y defined a s modification s unde r th e Act , an

dd o no t include change s no t covere

db y thos e definition s tha t ar e governedb

y Stat e or loca l mino r ne w sourc e revie

w (NSR ) programs . Response :

• EP Ai s continuin g t o conside r ho wbes t t o addres s thi s issu e i n th e supplementa l proposa l i t plan s t o issu e i n Jun e 1995 . I n th e meantime , EP Aha s approve d a numbe r o f stat e permi t program s tha t hav e no t treate d mino r change s unde r thei r ne w sourc e revie wprograma s "Titl e I modifications. " Thes e program s allo wmino r NS R change s t o b e processe d a s mino r permi t modification s unde r thei r Titl e V program .

• EPA' s interpretatio n o f th e phras e "Titl e I modifications " i n th e curren t rul e allow s thi s approva l and EP Awil l continu e t o gran t simila r approvals .

• A s par t o f it s supplementa l proposa l EP Acurrentl yintend s t o offe r fo r publi c commen t a streamline d two-tracke d syste m fo r permi t revision s tha t build s o n existin g successfu l Stat e ne wsourc e revie wprograms . Unde r thi s process , State s woul d hav e greate r flexibilit yt o decid e th e amoun t o f publi c an

d EP Arevie wfo r mos t permi t revisions , by matchin g th e leve l o f revie wt o th e environmenta l significanc e o f th e change . Th e ne wsyste mfo r permi t revision s wil l reduc e th e importanc e o f th e phras e "Titl e I modifications " becaus e consideratio n o f whethe r th e chang e i s a Titl e I modificatio n woul d no t b e a facto r i n determinin g wha t revisio n proces s i s necessary . APPLICABL E REQUIREMENT S - EXCLUSIONO F CERTAI NTERM S Issue 5 : EPA

shoul dissue guidanc e confirmin g the following : State s ca

nlimi t mino r NS Rterm s includedi ntitl e V permit s t o thos e tha t the y dee m t o b e environmentall y significan t (bu

t State s woul dhave th e optiont o trea tP.1 2

mino r NS Ran

dTitl e V

separately) , an

d State s ar e onl y

reguiredto includ e stat e implementatio

nplan(SIP ) term

s tha t ar e necessar y element s o f anEPA-requirednonattainmen t or maintenanc e plan . Response :

• EP Aagree s tha t som e mino r NS Rterm s ma yb e obsolet e o r inappropriat e fo r operatin g permits
.

• EP Aintend s t o clarif ythrough guidanc e that , fo r example , th e permi t woul d no t nee d t o incorporat e th e NS Rapplicatio n b yreferenc e o r includ e certai n othe r term s determine d b y th e sourc e and permi t authorit yt o b e extraneous . Thi s guidanc e wil l indicat e th e type s o f term s tha t ma yb e extraneou s an

d woul d sugges t way s i n whic h State s ma ydro p thes e requirement s fromNS R an d Titl e V

permits
. [For treating mino r NS R an d Titl e V

separately , se e respons e t o th e nex t issue. ]
APPLICABL E REQUIREMENT S - LEVE L O F DETAI L Issu e 6 : EP

A shoul dallo

w State s to includ

e a basi c requiremen t to compl y

wit ha particula r genera l progra m i nth e Titl e V permit , wit ha

nacknowledgmen t tha t complianc e wit hth

e underlyin

g requirements , a s revisedfro m tim e to time , wil l be required . Thes e genera l programs woul dinclude : mino r NS R monitorin

g an denhance

dmonitorin

g categorie s o f de minimi s reasonabl y availabl e contro l technolog

y (RACT ) requirement s an d determination s o f RAC T non-applicabilit y 112(r ) ris k managemen t plan s EP A shoul dissue guidanc e to confir m tha t applicabl e requirement s may

b e incorporatedint o Titl e V permit s usin g citation s (i.e. , references ) rathe r tha n narrativ

e restatement , Response : Whil e EP Abelieve s thi s approac h coul d lea d t o permit s tha t woul d no t hav e specific , enforceabl e condition s fo r som e o f 1 0thes e requirements , EP Ai s continuin g t o conside r varyin g

way s i n whic h state s ma yincorporat e ne wsourc e revie w requirement s int o Titl e V permits
.

• Som e requirement s d o len d themselve s t o generi c treatment . I n th e Marc h 199 4 supplementa l proposa l o n accidenta l release s unde r sectio n 112(r) , EP Apropose d standar d permi t condition s tha t woul d assur e complianc e wit h requirement s o f th e accidenta l releas e program . Unde r thi s approac h th e ris k managemen t pla n woul d no t b e a par t o f th e applicatio n o r th e permit
. Change s t o th e ris k managemen t pla n woul d no t requir e revisin g th e permit
.

• EP Aagree s tha t a citation-base d approac h t o identifyin g underlyin g requirement s i s neede d and wil l b e issuin g guidanc e o n th e us e o f citation s i n Jun e 1995 .

• EP Adescribe d fo r publi c commen t a n approac h t o cross referencin g i n it s Augus t 29 , 199 4 proposal , and intend s t o expand o n thi s approac h i n th e guidanc e documen t mentione d above . Unde r th e Augus t proposal , th e permi t woul d nee d t o includ e th e emissio n limit s an d monitorin g requirements , whil e tes t method s an d length

yprocedure s coul d b e referenced . An

ycitatio n woul d nee d t o ensur e tha t judgement s require d i n a n underlyin g requiremen t ar e identifie d i n th e permit
. OPERATIONAL FLEXIBILIT Y AND PERMI T REVISIONPROCEDURE S Issu e 7 : EP Ashoul d promulgat e th e operatin g permi t revisio n

procedure s tha t reflec t th e approac h se t ou t i n industry' s "stra wproposal. " Response :

• EPA' s supplementa l rul e o n Titl e V permi t revisions , whic h wil l b e issue d i n Jun e 1995 , wil l addres s thi s issue
. Thi s proposa l wil l includ e a n alternative , streamline d syste mfo r permi t revision s tha t build s upo n existin g stat e permi t programs .

• I t wil l giv e State s grea t flexibilit yt o decid e th e amoun t o f publi c and EP Arevie wfo r mos t permi t revisions , by matchin g th e leve l o f revie wt o th e environmenta l significanc e o f th e change . AStat e i s no t require d t o provid e an

yrevie wfo r change s tha t i t ca n sho war e d e minimis
. Th e public , affecte d States , and EP Awoul d hav e a n adequat e opportunit yt o revie wand commen t o n mor e environmentall ysignifican t actions
.

• Unde r th e Jun e proposal , change s tha t d o no t requir e 1 1P.1 4

approva l unde r Stat e mino r NS Rwoul dbe allowe dt o proceed wit hn o furthe r revie

w upo nsubmitta l o f a notic e t o th e State , providedth

e change woul dnot conflic t wit hth e Titl e V permit .
• The permi t revisio nprocedure s ar e expectedt o avoi d duplicationwit hexistin g Stat e permi t programs . For change s subjec t t o preconstructio nreview , an

y public , affectedStat e or EP A revie w woul doccu

r prio r t o constructionof th e project . Thi s i s wher e Stat e revie w i s alread y providedunde r ne w sourc e review , an

dwoul davoi d second-guessin

g of a preconstructio npermi t b

y EPA .
TITL E V MONITORIN

G Issue 8 : EP

A shoul dissue Titl e V monitorin

g guidanc e tha t provides : 1 ) Existin

g monitorin

g establisheda s par t o f an applicabl e requiremen t shoul dsatisfy th e Titl e V monitoring requirement . 2 ) I f n

o suchmonitorin

g i s providedi nth e underlyin

g requirement , state s ca nestablis hTitl e V monitorin

g a s par t o f th

e permittin

g process , subjec t t o th e followin

g constraints : monitoring dat a tha t i s sufficien t t o determine complianc e wit hth e underlyin

g applicabl e requiremen t shal l be th e objectiv

e o f an y ne w monitoring , an

dwher e th

e applicabl e requiremen t wa s establishedthroug hrulemaking , shoul donl y serv e a s indicator monitorin g unti l th

e complianc e determinatio

naspect s o f th

e underlyin

g requiremen t ca

nb e formall y

reviewedan

drevise

d throug hrulemaking . cost s shal l be take ni naccoun t i ndeterminin g suchmonitoring , expressl y recognizin

g tha t monitorin

g may no t b e feasibl e for certai nunit s becaus e an

y benefit s wil l b e outweighedb y associatedcosts . monitorin

g aus t b e establishedi na manne r tha t wil l assur e tha t anincreas e i nstringency o f th e underlyin

g requiremen t wil l no t result . 3 ) State s shoul db e abl e to exempt smal l unit s fro m monitoring . Response :
1 2P.1 5

• Severa l o f th e point s raise d ar e relate d t o EPA' s enhance d monitorin g propose d rul e whic h EP Ai s currentl yreexamining
. Eithe r a s par t o f tha t reexamination , o r i n separat e guidanc e EP Awil l clarif ywha t i s necessaryt o mee t th e operatin g permi t rul e requirement s o n periodi c monitoring
.

• EP Aagree s directionall ywit h th e point s tha t periodi c monitorin g shoul d b e satisfie d b ymonitorin g include d i n a n applicabl e requirement
.

• EP Aals o agree s tha t periodi c o r enhance d monitorin g i s no t intende d t o increas e th e stringenc yo f th e underlyin g requirement
. RESEARC H AND DEVELOPMENT ACTIVITIE S Issue 9 : EP

A shoul dexclude researchan ddevelopmen t (R&D ) an d relatedactivitie s fro m coverag e unde r Titl e V an d sectio n 112(g) . A

t a minimum , th

e curren t Titl e V

rul e mus t b e implemente d consisten t wit hth e preambl e t o mak e clea r tha t state s hav e authorit y

t o trea t co locatedR& D facilitie s an drelatedactivitie s separatel y

indeterminin

g whethe r the

y ar e a Titl e V majo r source . Response :

• I n th e Jun e 199 5 supplementa l proposa l o n permi t revisions , EP Awil l clarif ytha t unde r th e curren t rule , R& D facilitie s ma yb e considere d separatel yfromth e manufacturin g facilit y a t whic h the yar e located . Thi s mean s tha t R& D laboratorie s woul d no t b e require d t o obtai n a permit , unles s th e R& D facilit yalon e i s a majo r source .

1 3P.1 6
EPA' S RESPONS E T O ISSUE S RAISE D B YINDUSTR

YO N CLEA N AI RAC T IMPLEMENTATIO N REFOR M
New Sourc e Revie

w SUMMAR YOF RECOMMENDATION S Issue 1 : Ne

w sourc e revie

w (NSR ) i s triggere

db y tw o type s o f activitie s a t existin g sources : installin g ne w emission s unit s an

dchangin

g existin

g emission s units . Wit hrespec t to ne w units , th

e NS R"emissio

nincrease " test s exclusivel y

governNS Rapplicability . A s t o existin g units , th

e NS R"exclusions " fro m "physica l o r operationa l change, " a s wel l a s th e "emission s increase " test s determine applicability . EPA' s Jul y NS Rrefor

m packag e addressedbot htype s o f activitie s an dcontain s certai nsolution s tha t industr y supports . I t contain s othe r provision s tha t industr y doe s no t suppor t i nthei r presen t form . Finally , th e Jul y packag e omit s provision s tha t industr y believe s ar e essentia l to meaningfu l reform . "On e siz e doe s no t fi t all " i s a principl e tha t need s to be recognizedinth e NS Rprogram . Bot h"exclusion " provision s an

d"th e emissio

nincrease " test s mus t reflec t thi s principle . The "exclusions " to NS Reithe r focu s o nconduc t tha t existin g facilitie s normall y undertake durin

g thei r usefu l lif e o r o

nconduc t tha t th

e Agency

wishe s t o encourag e becaus e i t i s i nth e publi c interest . Differen t "exclusions " ar e neededi norde r to reflec t differen t condition s tha t exis t indifferen t facilities . The "exclusion " option s nee dto b e expanded . Option s ar e als o needed-unde r th e emission s increas e test . A

nallowable-to-allowabl e tes t shoul db e providedfor source s tha t hav e undergone NS Rrevie w an d fo r source s wher e th e Stat e implementatio nplan(SIP ) i s consisten t wit htha t approach . EPA shoul dals o confir m th e existin

g discretio

no f source s t o us e an actual-to-actua l approach . Sourc e owner s shoul dals o hav e discretio

nto choos e fro

m a menutha t includes , a t a minimum , thes e test s an dplantwid e applicabilit y limit s (PALs) .

1 4P.1 7

Response : EP Abega n a comprehensiv e reassessmen t o f it s NS R program ove r tw o year s ago . Tha t proces s involve d extensiv e discussion s wit h representative s fro m al l th e stakeholde r group s and resulte d i n recommendation s forwarde d t o EP Afrom th e Clea n Ai r Ac t Advisor yCommitte e (CAAAC) . EP Aha s develope d a regulatorypackag e addressin g th e recommende d change s and expect s th e propose d rule s t o b e signe d byth e Administrato r withi n th e nex t fe wmonths . Whil e EP Aview s th e packag e a s bein g balance d and a s no t sacrificin g th e environmenta l protectio n inheren t i n th e Ne w Sourc e Revie wprogram , ther e i s n o doub t tha t th e packag e wil l provid e industrywit h severa l importan t benefit s including :

• Deregulatio n o f man ychange s a t "clean " emission s unit s and pollutio n contro l and pollutio n preventio n project s

- - Source s tha t hav e clea n emission s unit s o r ar e undertakin g project s t o clea n u p ai r pollutio n woul d generall yno t b e targete d fo r federa l ne wsourc e review
.

• Promotio n o f voluntar yplant-wid e limit s - - Rathe r tha n fac e potentiall ycomplicated , piecemea l applicabilit y decision s everytim e a chang e a t a plan t i s contemplated , mos t plan t manager s prefe r t o wor k wit h a n emission s cap o r budget , a n annua l emission s limi t tha t allow s manager s t o mak e almos t an ychang e an

ytim e a s long a s th e plant' s emission s d o no t excee d th e cap . EP Awil l includ e thi s optio n i n th e propose d rule .

• Hel p fo r cyclica l industrie s suc h a s th e automobil e manufacturin g companie s - - Industryallege s tha t existin g regulation s unintentionall ypenaliz e industrie s tha t hav e suffere d recen t downturn s and inhibi t modernizin g change s tha t ar e vita l t o thei r recovery , eve n whe n change s a t a plan t lowe r emissions
. EPA' s proposa l wil l leve l th e playin g fiel d fo r thes e source s byextendin g th e rang e o f year s the yca n us e t o establis h thei r emission s baseline
.

• Encouragemen t o f pollutio n preventio n an d innovativ e contro l technologie s - - Th e propose d change s wil l ensur e tha t bon a fid e pollutio n preventio n qualifie s fo r th e pollutio n contro l projec t exclusio n an d revam p th e under-use d innovativ e contro l technologywaive r t o simplif yth e proces s and eliminat e penaltie s fo r goo d fait h failures
. 

### 1 5Bette r coordinatio n o f permit s impacting Clas s I area s

- - EP Awil l clarif yth e rol e o f th e Federa l Lan d Manager , th e Stat e permittin g authorit yand th e applican t wit h regar d t o th e NS R permittin g process . Othe r change s establis h d e minimi s level s fo r ai r qualit yimpact s an

d provid e mitigatio n alternative s fo r source s whos e propose d ne wemission s threate n Clas s I areas . Th e change s shoul d dramaticall yreduc e delay s an d dispute s currentl yassociate d wit h permittin g nea r federa l Clas s I areas . Increase d Stat e flexibilit y- - Instea d o f one-size

fits-al l solution s t o applicabilit yand othe r issues , State s woul d b e explicitl yallowe d fo r th e firs t tim e t o choos e applicabilit yand implementatio n approache s froma men u o f alternatives
. EXCLUSION S FROM PHYSICAL AND OPERATIONAL CHANGE S Issu e 2 : Pollutio n Contro l Projec t (PCP ) Exclusion : Th e

exclusio n shoul d follo wth e Wisconsi n Electri c Powe r Compan y(WEPCO ) exclusio n bydroppin g th e followin g fromth e Jul ydraft :

- Th e requiremen t tha t th e sourc e owne r see k and obtai n a prio r stat e determinatio n tha t th e pollutio n contro l projec t exclusio n applie s "up-front " befor e commencin g constructio n o n a project
.

- Th e mandator ycontro l requirement s o f collatera l emission s increases
.

- Th e "offset " requiremen t fo r nonattainmen t areas .

- Th e "ai r toxics " ris k evaluation
. Response :

• EP Agenerall yagree s an d a s mentione d above , EP Awil l b e proposin g a broa d pollutio n contro l projec t exclusio n a s par t o f it s NS R reformpackag e t o allo wexemption s fo r source s tha t hav e clea n emissio n unit s o r undertakin g project s t o clea n u p ai r pollution
.

• Thi s exclusio n wil l no t includ e an yspecifi c requiremen t fo r Stat e pre-authorization
. EP Aexpect s tha t mos t project s wil l b e reviewe d b ystate s a s par t o f thei r mino r NS R programs . A s wit h EPA' s existin g NS R exclusions , th e timin g and natur e o f thi s stat e mino r NS R approva l wil l b e lef t fo r state s t o determine
.

1 6P.1 9

• Th e propose d exclusio n wil l includ e th e following safeguar d use d i n th e WEPC O rul e t o ensur e tha t pollutio n contro l project s d o no t hav e a n advers e environmenta l impact : Th e projec t canno t caus e o r contribut e t o a violatio n o f a nationa l ambien t ai r qualit ystandard s (NAAQS) , o r preventio n o f significan t deterioratio n (PSD ) incremen t o r hav e a n advers e impac t o n ai r qualit yrelate d value s (AQRVs ) i n a Clas s I area .

• Unde r thi s test , state s ar e t o conside r th e collatera l emission s froma projec t and ensur e tha t ne wemission s o f nonattainmen t pollutant s d o no t contribut e t o th e existin g problem . EP Aregulation s wil l no t specif yho w th e stat e mus t dea l wit h increase s tha t d o no t contribut e t o a nonattainmen t problem .

• EP Awil l no t requir e a n evaluatio n fo r toxi c emission s fo r pollutio n contro l project s tha t ar e add-o n o r fue l switche s t o a les s pollutin g fuel . EPA' s experienc e wit h suc h project s ha s show

n tha t a toxic s safeguar d i s no t needed . Give n th e uncertai n natur e o f man ypollutio n preventio n projects , EP Abelieve s tha t i t i s a reasonabl e environmenta l safeguar d t o confirmtha t suc h project s resul t i n a n environmenta l benefi t befor e a pollutio n contro l projec t exemptio n i s granted . A s par t o f a n evaluatio n o f whethe r a projec t i s environmentall ybeneficial , EP Awoul d expec t state s t o conside r an yincreas e i n toxi c emissions
. Issu e 3 : Pollutio n Preventio n Exemption : A s EP A ha s recognize d i n numerou s publi c statements , "pollutio n prevention " project s (i.e. , project s tha t allo w a facility

to produc e a produc t wit h les s environmenta l discharge s pe r uni t o f produc t made ) mus t b e encouraged . T o effectuat e thi s policy , th e "pollutio n prevention " exclusio n propose d b y th e Agenc y

should :

- Eliminat e th e Jul ydraf t requiremen t tha t th e projec t no t improv e efficienc yno r increas e annua l utilization
.

- Exclud e al l "pollutio n prevention " project s fro m NS R unles s th e projec t increase s the source' s "potentia l t o emit. " Response :

• Th e pollutio n contro l projec t exclusio n include d i n th e NS R Refor mrulemakin g wil l extend th e exclusio n t o pollutio n preventio n projects
. Anypollutio n preventio n projec t wil l qualif ya s long a s i t i s "environmentall ybeneficial " and wil l no t caus e o r contribut e t o a violatio n o f a NAAQ S o r PS D increment , o r caus e a Clas s I advers e impact
. 

### 1 7 »< * • Thes e condition s ar e patterne d afte r th e WEPC O rul e an d ^ wil l creat e a broad , flexibl e exclusio n fo r pollutio n *. • preventio n projects
.

• An exclusio n o f project s tha t d o no t increas e a source' s potentia l t o emi t woul d creat e a n exclusio n tha t coul d considerabl yreduc e th e effectivenes s o f th e NS R program . Almos t an

ymodernizatio n tha t a sourc e undertake s ha s th e incidenta l effec t o f lowering emissions
. Ane wemission s uni t o r modernizatio n generall yha s fewe r emission s tha t on e buil t 4 0 year s earlier
. Sinc e thes e type s o f change s woul d no t likel yincreas e a source' s potentia l t o emit , industry woul d clai m

thi s a s a pollutio n preventio n projec t - - eve n though its ' pollutio n preventio n aspect s ar e likel yt o b e negligibl e an

d actua l emission s ma yincreas e dramaticall y du e t o increase d utilization
. Issue 4 : A

Ne w "Cros s Media " Projec t Exclusion : EP A shoul d« recogniz e tha t pollutioncontro l project s required unde r othe r law

s may resul t i n"collateral " emission s increase s o f ai r pollutants . The PC P exclusio nfor ai r pollutionproject s shoul dbe extendedto thes e projects . Response :

• Cros s medi a projec t exclusion s ar e unde r consideratio n b y EPA . EP Awil l solici t comment s o n extendin g th e PC P exclusio n t o cove r thes e type s o f projects , provide d the yd o no t caus e o r contribut e t o NAAQ S violation , PS D incremen t violatio n o r advers e impac t o n Clas s I area .

• Als o thi s issu e ma yb e addresse d i n multi-medi a permittin g pilo t initiativ e currentl yunderway . Issu e 5 : "Routin

e Maintenance , Repai r an dReplacement " Exclusion : The Jul y guidanc e o

nthi s exclusio

nshoul d b e dropped . Instead , th e followin

g guidanc e shoul dbe includedi nth

e proposal : "Routin e maintenance , repair , an dreplacemen t mean s maintenance , repai r an dreplacemen t project s occurrin

g o na regula r basis , o na cyclica l basis , o r du e t o unanticipate dfailur e o f equipment , whic har e undertakeninanindustria l categor y t o maintai ncompetitiv e positiono r reliabl e operation. "

1 8P.2 1

Response :

• EP Aagree s wit h removin g th e routin e maintenance , repai r an d replacemen t languag e fromth e proposa l package .

• Wit h othe r change s bein g mad e t o NS R applicability , thi s issu e become s les s important
. Bot h PAL s and th e Clea n Uni t Tes t (include d i n th e NS R Reform proposa l rule ) wil l provid e clea r distinctio n o f th e type s o f change s tha t ca n b e undertake n withou t triggerin g NSR . Issue 6 : A

"Restoration " Exclusion : A new exclusion , base don th e "result s in " language i nth e modification definition , shoul dbe includedfor activitie s tha t restor e a uni t t o th e highes t capacity

achievabl e i n th e previou s fiv

e years . Th e exclusionwoul db e limitedi ntim

e an dwoul drecogniz e tha t requirement s governin

g th e timin g o f capita l expenditure s vary dependin

g uponmarke t conditions , an dmay no t allo

w an industr y to mak e a capita l investmen t t o restor e operation s immediatel y afte r a proble

m occurs . I t woul dals o recogniz e tha t unit s tha t hav e deteriorated ove r mor e tha

na fiv e yea r periodo f tim e shoul db e evaluatedunde r othe r tests . Thi s i s consisten t wit h th e WEPCO rule' s implementatio no f th

e "causa l link " requiremen t thoug

hth e rule' s focu s on"representativ e baseline " yea r condition s i nth e definitiono f "representativ

e actua l annua l emissions. " Response :

• EP Abelieve s th e issu e o f ho wrestoratio n o f los t capacit y shoul d b e treate d fo r NS R applicabilit ypurpose s i s bette r resolve d b

yth e PAL , th e Clea n Uni t Test , an d othe r mechanism s i n th e NS R Reformpackag e tha t provid e source s wit h considerabl e flexibilit yt o mak e changes . EP Abelieve s tha t th e routin e maintenanc e exclusio n alread yinclude d i n th e existin g NS R regulation s als o ha s th e effec t o f excludin g "routin e restorations. "
Issue 7 : "Clea

nUnit " Exclusion : Establis ha nexclusionfor source s tha t hav

e installedBAC T equivalen t leve l o f contro l or MAC T or reasonabl y availabl e contro l technolog

y (RACT ) o r thei r equivalent , unde r a stat e o r voluntar

y co xtro l program . Unit s tha t have undergon e NS Rshoul db e subjec t t o th e "allowable-allowable " tes t discussedi nth

e followin

g issue .



### 1 9*

Response :

• EP A agree s and ha s include d a ne wclea n uni t exclusio n whic h allow s a n operato r o f a uni t t o mak e change s t o th e uni t provide d th e chang e doe s no t increas e hourl yemission s (an d i s allowe d unde r permit)
. EP A i s taking commen t o n severa l alternativ e definition s fo r "clean unit " includin g th e industry' s suggeste d definition
. Issue 8 : Non-Emission s Uni t Exclusion : Industr y support s EPA' s suggestioni ndraf t NS Rpackag e o f las t summer tha t a NS Rexclusio

nb e create

dfo r non-emittin

g units . Response :

• Afte r consultatio n wit h a numbe r of stat e permittin g authorities , EP

A determine d that a regulator y change i s no t require d t o exclud e unit s tha t ar e generall yno t targete d a s emitter s o f ai r pollutants . Moreover , ther e wa s concer n tha t th e draf t non-emittin g uni t regulation s coul dsubjec t << » units , currentl yexclude d a s a matte r o f commo n sense , t o majo r NS R du e t o th e narro wexclusio n tha t wa s bein g proposed . T o preserv e th e permittin g authority' s existin g flexibility , EP Ai s no t proposin g a regulatoryexclusio n fo r nonemittin g units
. EP A wil l continu e t o evaluat e thi s issue , particularl ywit h regar d t o change s t o unit s tha t affec t th e emission s a t othe r units , and i f warranted , provid e guidanc e i n th e future . EMISSION S INCREAS E TEST S Issu e 9 : EPA' s proposa l shoul dInclude a men uo f alternativ

e emission s increas e tests . I f a sourc e owne r coul dsho w tha t ther e woul db e no significan t emissio nincreas e unde r a particula r test , NS Rwoul dno t b e triggered . (1 ) "Allowable-to-allowable " tes t for unit s tha t hav e undergone NSR . The "allowable-to-allowable " treatment for unit s tha t hav

e undergone NS Rrevie w i s a clarificatio

no f curren t la

w - - thes e unit s hav e been evaluatedan

dpermittedunde r th e NS Rprogra

m a t th e allowabl e leve l an dhav e beenevaluatedfor BAC T o r LAE Ra t tha t level . An y change s i nth

e uni t tha t allo

w th e -uni t to achiev

e permittedlevel s hav e bee n authorizedb

y th e NS Rpermit . (2 ) A n"actual-to-actual " tes t for unit s tha t have "begu nnorma l operations " wit ha 5 yea r look-bac k an d explici t preambl e language recognizin g tha t i f a projectedor actua l increas e i nproductionrat e o r hour s o f operationabov e pas t actua l level s i s no t 2 0cause db y a change , th

e hour s o f operatio nproductio

n rat e increas e exclusion s applies . (3 ) A nactual-to-potentia l tes t wit ha 1 0 yea r look bac k tha t applie s to unit s tha t ar e ne w greenfiel d units , an

da t th e optio no f th e sourc e owner , to unit s tha t have begu

nnorma l operations . (4 ) Plant-wide applicability limit s - - a s i nth e Jul y draf t rule . Response : EP Ai s fo r th e firs t tim e proposin g t o giv e State s a serie s o f applicabilit yoption s including version s o f al l fou r o f thes e test s fo r determinin g whethe r a n increas e i n emission s wil l follo wfroma propose d change . A s a result , State s ma y offe r al l o f thes e option s t o industrywit h th e onl y limitatio n tha t source s wil l no t b e allowe d t o "game " th e syste mb

yswitching betwee n incompatibl e options
. Fo r instance , i f a sourc e choose s a PAL , i t ma yno t g o abov e th e PAL limi t becaus e i t want s t o us e a "clean unit " test . CLAS S I AREA S Issue 10 : Permittin g Authorit y

Control : EPA' s NS Rrule s mus t mak e i t clear tha t i t i s th e permi t issuin

g agencie s - - no t Federa l Lan

dManager s (FLM ) - - tha t hav e th e authority t o determine i f a PS D permi t applicants ' proposedne w sourc e wil l hav

e anadvers e impac t o nai r quality relatedvalue s (AQRVs ) inClas s I areas . Response :

• EPA' s draf t NS R Reformpackag e set s u p criteri a fo r th e permittin g authorit yt o conside r whe n rejectin g a FLM' s finding o f advers e impact
. Th e draf t preambl e and regulation s mak e clea r tha t thi s i s ultimatel yth e permittin g authority' s decisio n whe n th e propose d sourc e doe s no t caus e o r contribut e t o a Clas s I incremen t exceedance . Issue 11 : Clas s I Size/Distanc e Cut-Offs : EPA shoul dse t reasonabl e size/distanc e cut-off s s o tha t source s can avoi dal l aspect s o f th e Clas s I are a revie w proces s i f the y ar e smal l enoug

ho r propos e t o locat e fa r enoug h awa y fro m Clas s I areas . Response :

• EPA' s draf t NS R Reformpackag e fo r th e firs t tim e propose s Clas s I incremen t significanc e level s whic h wil l allo wsmal l 2 1source s t o demonstrat e tha t theywil l hav e a d e minimi s

impac t o n th e Clas s I increment
. Sinc e AQRV s ma yb e specifi c t o th e Clas s I are a an d involv e secondaryimpact s tha t ar e considerabl ymor e complicate d t o asses s tha n a n increment , EP Adoe s no t se t nationa l significanc e level s fo r AQRVs . EP Aexpect s tha t th e existenc e o f th e Clas s I significanc e level s wil l hel p considerabl yi n eliminating delay s fo r smal l sources . Issue 12 : Earl y

FL M Coordination : Permi t applicant s shoul db e encouraged , bu t no t required , to notif y FLM s earl y

on o f majo r source s proposin g to locat e withi n10 0 k m o f a Clas s I area . Thi s may be accomplishedthroug h establishmen t o f a bulleti nboardservice . Response :

• EPA' s draf t proposa l doe s addres s th e establishmen t o f a bulleti n boar d syste mand call s fo r State s t o lis t project s o n th e dat a base . State s ar e als o require d t o includ e FLM s i n an ypre-applicatio n meeting s involving project s withi n 10 0 kilometer s (kms ) o f a Clas s I are a an d provid e copie s o f permi t application s fo r propose d source s withi n 10 0 km s o f a Federa l Clas s I area . Fo r new , larg e project s outsid e o f 10 0 kms , State s ar e encouraged , bu t no t required , t o includ e th e FL M i n an

ypre-applicatio n meetin g a s appropriate
. Issu e 13 : EP AApprova l o f Model s and Modelin g Techniques : EP A shoul d mak e i t clea r tha t permi t issuin g agencie s nee d no t giv e an

ydeferenc e t o FL

M claim s o f advers e impact s o n AQRV s i n a Clas s I are a whe nth e FL M claim s ar e no t base d o n us e o f EPA-approve d model s or modeling technique s fo r evaluatin g th e impact s o f a propose d ne w sourc e o n AQRVs . Response : ®EPA' s draf t proposa l distinguishe s betwee n modelin g t o determin e ai r qualit yimpact s and a n AQR V analysis
. EP A doe s approv e model s use d U o predic t th e impac t o f emission s froma sourc e o n th e surroundin g ai r quality , and generall y require s th e us e o f a n EPA-approve d mode l fo r thi s showing
. However , AQR

V analyse s generall ystar t wit h th e ambien t loading s predicte d b yth e EPA-approve d model s and the n determin e wha t th e impac t o f tha t loadin g wil l b e o n th e AQR V i n question , suc h a s th e impac t o f ambien t sulfu r dioxid e (an

d it s derivatives ) o n visibility
. I n general , EP Aha s n o approva l procedure s i n plac e fo r thes e conversio n methodologie s and doe s no t requir e tha t FLMs , States , o r source s secur e EP Aapproval , I n th e draf t NS R Reform package , EP Aprovide s tha t conversio n methodologie s b e subjec t t o publi c notic e an d comment , eithe r befor e it s us e 2 2: b

y a sourc e or FL

M or i nconjunctio

nwit ha determinatio no n a specifi c permit . Issu e 14 : Mitigationo f Sourc e Impact s Throug hOffsets : EP

A shoul dprovid e State s inrule s for a broadrange o f approache s for assessin g th e adequacy

o f offset s i n mitigationo f advers e AQR V impacts . Response :
• The draf t NS RRefor m Rul e set s ou

t genera l principle s fo r assessin

g offsets . EP

A i s als o takin

g comment o

nwhethe r offset s for source s impactin g Clas s I area s may includ e "double- counting " emission s reduction s neededb y a sourc e t o comply wit hothe r Clea

nAi r Ac t requirements . Issue 15 : Existin

g Sourc e Problems : EP A shoul dno t us e th e NS R proces s t o addres s problems tha t may b e causedb

y existin g source s (includin g existin

g mobil e sources ) impact s o

nClas s I areas . Response :
• EP A i s i n th

e proces s of developin g regiona l haz e regulation s tha t ar e focuse d o n existin g source s an

dClas s I are a visibilit ydegradatio n cause d b y thes e existin

g emissions
. Assumin g al l othe r applicabl e PS D requirement s ar e met , th e draf t NS R Reformpackag e woul drequir e permi t denia l fo r Clas s I are a concern s i f th e ne wemission s wil l hav e a n advers e impac t o n AQRVs . I t i s th e stat e or othe r permittin g authority , an d no t th e FLMs , tha t wil l mak e th e fina l determinatio n a s t o whethe r th e propose d source' s emission s wil l hav e thes e proscribe d result s (fo r AQRVs , th e stat e decide s whe n th e propose d sourc e doe s no t caus e or contribut e t o a Clas s I incremen t exceedance) . TOP-DOW NBES T AVAILABL E CONTRO L TECHNOLOGY Issue 16 : Eliminat e To pDow nBACT : The top-dow nBAC T approac h remove s fro

m th e State s discretiontha t th e CleanAi r Ac t ha s givento the m to mak e BAC T determinations . EPA shoul dsubstantiall y revis e o r eliminat e th e "to pdow n BACT " approach . Response : • EP A doe s no t requir e state s t o us e th e to pdow nmethodolog

y for makin

g BAC T determination s i nit s draf t NS RRefor m package . Instead , EPA' s proposedregulation s for stat e programs wil l identif y certai ncor e criteri a tha t BAC T determination s mus t meet . Thes e criteri a include tha t the applican t conside r th e mos t stringen t technolog y an dprovide anacceptabl e rational e i f th e mos t stringen t technolog y i s 2 3no t accepted . EP Awoul d propos e a top-dow n approac h i n it s PS D regulation s whic h ar e applicabl e t o state s withou t SIP

approve d PS D programs . Issu e 17 : Requir e Exclusiv e Us e o f Incrementa l Costs : EP A shoul d specif y tha t incrementa l rathe r tha naverag e cost s shoul d be th

e basi s fo

r selectio

nan drejectio

no f contro l technologie s unde r th e BAC T process . Response :

• Sinc e EPA' s draf t provide s state s wit h discretio n i n makin g BAC T determination s and i n evaluatin g th e factor s tha t g o int o tha t decision , i t woul d b e inappropriat e fo r EP At o mandat e tha t state s us e onl yincrementa l cost s i n assessin g BAC T options
. Th e draf t NS R Reformpackag e woul d no t chang e EPA' s curren t polic ytha t recommend s state s conside r bot h averag e an

d incrementa l cost s i n selecting th e fina l BAC T level . Issu e 18 : BAC T "Cut-Off: " EP Amus t establis h a "cut-of f dat e

fo r considerin g undocumente d ne wtechnologie s i n th e BAC T selection
. EP Ashoul d retai nth e proposed provisio n requirin g commenter s o ndraf t PS D permit s to sho w tha t technologie s hav e bee n"demonstratedi n practice, " i.e. , tha t a ne w or emergin

g technolog

y mus t hav e si x month s o f operatin g performanc e histor y t o verif yit s claime d effectiveness
. Response :

• I n th e draf t NS R Reformpackage , EP Ai s including a presumptiv e cut-of f dat e an d a provisio n tha t undocumente d ne wtechnologie s considere d i n determinin g BAC T mus t hav e si x month s o f operation s t o verif yclaime d effectiveness
. AI R OUALIT Y ISSUE S Issu e 19 : EP

A shoul d delet e pre-constructio n monitorin g requirement s fromth e PS D rules . Wher e post constructio n monitorin g ca nproduc e usefu l data , i t may b e appropriat e for EP At o requir e suchmonitoring . Response : ©Sectio n 165(e)(1 ) o f th e CA Arequire s eac h PS D sourc e (or permittin g authority ) t o conduc t a preconstructio n analysi s o f th e ambien t ai r qualit ya t th e propose d sit e and i n area s whic h ma yb e affecte d b yth e source' s emissions , i n accordanc e wit h regulation s issue d byEPA . EP Abelieve s tha t i t i s appropriat e t o reevaluat e th e regulator y requirement s fo r preconstructio n monitorin g fo r propose d PS D 2 4construction , wher e ai r qualit ydat a canno t feasibl yb e use d

t o analyz e a source' s impac t upo n ai r qualit ystandards , i n th e draf t NS R Reform Rule , EP Ai s solicitin g commen t o n th e appropriatenes s o f providin g a n exemptio n fo r som e case s fromPS D preconstructio n monitoring
.

• Existin g regulation s [e.g. , 51.166(m)(2) ] provid e fo r th e us e o f post-constructio n monitorin g whe n i n th e opinio n o f th e permittin g authorit ysuc h monitorin g i s necessaryt o determin e th e effec t emission s ma yhave , o r ar e having , o n ai r qualit yi n an

yarea . However , existin g regulation s d o no t specif ytha t suc h ambien t monitorin g ma yinclud e th e monitorin g o f ai r quality-relate d impact s i n Federa l Clas s I areas . I n th e draf t NS R ReformRule , EP Ai s proposin g t o amend it s PS D regulation s t o clarif ytha t post-constructio n ambien t monitorin g ma yb e require d fo r th e purpos e o f determinin g th e effec t emission s froma facilit yma yhave , o r ar e having , o n AQRV s i n a Federa l Clas s I area . Issu e 20 : Sinc e th e Clea n Ai r Ac t specificall yexempt s fro mPS D

revie wpollutant s tha t ar e regulate d unde r sectio n 112 , EP Ashoul d dro p it s proposa l fo r ai r qualit yimpac t analyse s fo r sectio n 11 2 pollutants . Response :

• Sectio n 112(b)(6 ) o f th e Ac t provide s tha t par t C requirement s fo r preventio n o f significan t deterioratio n (PSD ) d o no t appl yt o hazardou s ai r pollutant s (HAPs ) liste d unde r sectio n 112 . I n a Marc h 11 , 199 1 memorandum , EP A state d tha t i t woul d n o longe r conside r HAP s t o b e individuall yregulate d unde r th e Federa l PS D regulation s a t 4 0 CF R 52.21 . However , EP Aals o indicate d tha t an yHA P tha t i s a constituen t o f a mor e genera l pollutan t liste d unde r sectio n 10 8 o f th e CA A(e.g. , VOC , particulat e matter ) remain s regulate d unde r PS D a s par t o f tha t regulate d pollutant . £ee , 5 7 F R 1807 0 a t 18074-7 5 (Apri l 28 , 1992 ) (publicatio n o f Marc h 11 , 199 1 memorandum) . Thi s polic y wil l b e addresse d i n EPA' s rulemakin g initiativ e t o updat e th e PS D and NS R regulation s base d o n th e 199 0 CA A Amendments , schedule d fo r proposa l thi s summer . EP Aha s remove d additiona l discussio n o f HAPs/PS D implementatio n issue s from

th e draf t NS R Reformrul e an d wil l evaluat e th e nee d fo r furthe r guidanc e ove r th e nex t severa l months .



### 2 5LOWES T ACHIEVABL E EMISSIONRAT E

Issu e 21 : Lowes t Achievabl e Emissio n Rat e (LAER ) determination s

shoul d facto r i n economi c considerations
. Response :

• A s oppose d t o BACT , th e definitio n o f LAE R doe s no t provid e fo r th e consideratio n o f economics
. However , EPA' s existin g guidanc e provides , i n a generi c sense , fo r limite d consideratio n o f economi c factor s i n a LAE R determination
. EPA' s polic yi s tha t i f a n emissio n limi t wil l preclud e constructio n o f ne wplant s withi n a clas s o r categoryo f sources , the n ther e i s justificatio n fo r th e permittin g authorit yt o reevaluat e tha t particula r LAE R limi t fo r tha t clas s o r categoryo f source . I f anothe r plan t i n th e same (or comparable ) industryalread yuse s tha t contro l technology , the n suc h us e constitute s evidenc e tha t th e cos t t o industryo f tha t contro l technolog yi s no t prohibitive
. Thus , LAE R cost s ar e considere d onl yt o th e degre e tha t the y reflec t unusua l circumstance s which , i n som e manner , differentiat e th e cos t o f contro l fo r a sourc e fromcontro l cost s fo r th e res t o f th e industry
. UNDEMONSTRATE D CONTRO L TECHNOLOGY/APPLICATION(UT/A ) AN D DEMONSTRATE D POLLUTIONPREVENTION Issu e 22 : EP Amus t extend th e UT/ Awaive r t o LAE R decision s fo r

source s i n nonattainmen t areas . Althoug h th e UT/ A waive r provide s evidenc e tha t th e LAE R definitio n ca n b e interprete d t o provid e fo r "comparability, " th e concep t wa s no t properl yextende d t o project s tha t emplo ydemonstrate d pollutio n preventio n technologie s i n nonattainmen t areas . Response : e EP Aagree s tha t applicabilit yo f th e UT/ Ashoul d b e extende d t o nonattainmen t area s an d i s proposin g t o d o s o i n th e draf t NS R Reform

Rule .

• Th e UT/ Awaive r doe s no t provid e evidenc e tha t th e LAE R definitio n ca n b e interprete d t o provid e fo r "comparability " and tha t i t shoul d b e extende d t o demonstrate d contro l technique s o r applications
. Th e draf t UT/ Awaive r regulations , consisten t wit h th e Agency' s interpretatio n o f LAER , requir e a n undemonstrate d contro l techniqu e installe d i n a nonattainmen t are a t o achiev e applicabl e LAE R limits
. Th e comparabilit yconcep t i s applicabl e onl yt o a n undemonstrate d techniqu e tha t marginall yfail s t o achiev e it s permitte d .limit
. A s crafted , th e permittin g authorit y 2 6P.2 9

establishe s margina l failur e emissio n limit s whic h ar e include d i n th e UT/A' s permi t an d subjec t t o publi c revie w and comment . Thi s concep t i s designe d t o enhanc e and encourag e th e installatio n o f undemonstrate d contro l technique s o r application s b yprovidin g th e permittin g authorit ywit h increase d flexibilit yt o eithe r accep t o r rejec t a n UT/ Atha t marginall yfail s t o achiev e it s permitte d limit
. Thi s flexibilit yi s no t availabl e unde r existin g innovativ e contro l technolog ywaive r regulations
. Issue 23 : The concep t o f "comparabl e emissio nreductions " whic h EP A ha s proposedfo

r UT/ A waiver s i nnonattainmen t area s shoul dbe extendedto demonstratedpollution preventiontechnologie s i nnonattainmen t areas . Response :

• Th e concep t o f "comparabl e emissio n reductions " and it s applicatio n t o demonstrate d pollutio n preventio n technologie s i n nonattainmen t area s i s addresse d i n th e Agency' s respons e t o Issu e 2 2 above . • «



### 2 7EPA' S RESPONS E T O ISSUE S RAISE D B YINDUSTR

YO N CLEA N AI RAC T IMPLEMENTATIO N REFOR M Ai r Toxic s - Sectio n11 2 Issu e 1 : The Sectio

n11 2 progra

m bein g developedan

dimplemente

d b y EP A i s contrar

y t o Congress' s planfo r regulatin

g ai r toxics , an

di s fundamentall y

unfai r to th

e regulatedcommunity becaus e control s ar e required sooner , appl y

mor e broadly , an

dar e mor e stringen t tha n Congres s intended . EP A mus t adop t anai r toxic s progra m tha t reflect s th

e gradation s an

ddistinction s mandatedb

y Congress . B

y imposin

g overly-broad regulation s EP

A i s severel y

complicatin

g th e implementatio

no f Sectio

n11 2 an

dforcin

g regulated source s to commi t substantia l huma nan dfinancia l resource s to mee t standard s tha t ar e neithe r justified no r authorizedb

y th e Clea nAi r Act . Response :

• Sectio n 11 2 i s a commo n sens e approac h t o th e regulatio n o f ai r toxic s acros s th e Nation
. Fo r 2 0 years , th e Clea n Ai r Ac t directe d EP At o us e ris k assessmen t t o regulat e hazardou s ai r pollutant s t o a n "ampl e margi n o f safety " level . B

y1990 , ther e wa s broa d consensu s tha t thi s approac h ha d failed
. Du e t o controvers yand litigatio n ove r ris k assessment s an d "ho wsaf e i s safe, " EP Aha d manage d t o se t standard s fo r onl yseve n toxi c ai r pollutant s and a handfu l o f sources . Mor e tha n two-and-one-hal f billio n pound s o f toxi c chemical s wer e stil l release d int o th e ai r eac h year , accordin g t o industry-reporte d Toxic s Releas e Inventory(TRI ) data . Thus , industry , environmentalists , State s an

d EPAbroadl yagree d i n 199 0 t o us e a technology

base d approac h a s th e primarymean s o f reducin g emission s o f ai r toxics
.

• Congres s create d th e Maximu mAchievabl e Contro l Technology o r MAC T program

a s a practica l approach : base d o n evaluatio n o f existin g contro l technologies , EP A mus t establis h contro l requirement s t o assur e al l majo r source s o f hazardou s ai r pollutant s (HAPs ) achiev e th e leve l o f contro l alread

ybein g achieve d b yth e bette r performin g simila r sources . Th e MAC T programprovide s fo r environmenta l equit yb yleveling th e playin g fiel d fo r industrys o tha t cleane r facilitie s ar e no t a t a competitiv e disadvantag e relativ e t o thei r dirtie r competitors
.

• EP Abelieve s th e MAC T programi s working
. I nth e fou r year s sinc e 1990 , th e ai r toxic s programha s achieve d mor e tha n wa s accomplishe d durin g th e prio r 2 0 years . EP A alread yha s se t standard s fo r 1 0 majo r industries , whic h whe n full y implemente d wil l reduc e toxi c emission s b ymor e tha n on e 2 8P.3 1

billio n pound s pe r year . I n doin g so , EP Ai s implementing th e MAC T programi n a creativ e an d flexibl e manne r t o ensur e tha t th e standard s ar e practical , mak e commo n sense , and
• focu s o n environmenta l results .

• EP Aha s worke d closel ywit h industryan d other s o n eac h MAC T standard . Wher e high cost s o r othe r problem s ar e identified , EP Ai s taking a cooperativ e an d problem-solvin g approach . Th e statut e provide s a men u o f tool s EP Ai s activel yusin g t o smoot h th e rough edge s tha t ca n sometime s occu r wit h a technology-base d approach . Thes e include : Applicabilit ycutoff s Subcategorizatio n Emission s averagin g Breadt h o f affecte d sourc e definitio n Complianc e schedul e beyond three-yea r complianc e dat e whe n environmenta l benefit s warran t i t Prohibitory(exclusionary ) rule s i n MAC T standard s (which serv e a s limit s o n potentia l emissions )

• EP Aremain s committe d t o workin g wit h industryand othe r stakeholder s i n th e developmen t o f it s ai r toxic s rule s t o assur e commo n sens e approache s ca n b e implemented
. I . TH E DEFINITIONO F MAJO R SOURC E AND TH E APPLICABILIT Y O F MAC T AND GAC T Issue s 2 , 3 an

d4 : Majo r source s mus t b e definedwit hreferenc e t o sectio n 112(c ) sourc e categories . MAC T fo

r Categorie s o f Majo r Source s mus t appl y onl y t o co locatedsource s o f HAP s ina givensourc e categor y tha t togethe r hav

e th e potentia l t o exceedth e 10/2 5 ton s pe r yea r majo r sourc e thresholds . MAC T for a givenmajo r sourc e categor y mus t no t exten

dto co-locatedare a source s o r i n co-locatedmajo r source s i ndifferen t sourc e categories . MAC T an dGAC T for Categorie s o f Are a Source s - - Are a source s (includin

g are a source s co-locatedwit hmajo r sources ) shoul db e subjec t to MAC T o r GAC T for categorie s o f are a source s onl y

afte r EP

A demonstrate s tha t th e are a sourc e categor y present s a threa t o f advers e effect s t o human healt hor th

e environmen t tha t warrant s regulations .

2 9Response :

Thes e thre e issue s concer n th e definitio n o f majo r source , whic h i s th e subjec t o f a pendin g cour t decision
. EP A agree s tha t i t i s importan t t o resolv e thi s issu e a s soo n a s possibl e becaus e o f it s broa d implication s fo r th e sectio n 11 2 program . Th e Agenc ybelieve s tha t it s definitio n o f majo r sourc e make s commo n sense , i s consisten t wit h th e law , and addresse s publi c concern s abou t ai r toxics
. Unde r EPA' s definition , th e determinatio n o f whethe r a facilit yi s a majo r sourc e depend s upo n tota l HA P emission s from th e entir e facility , no t jus t fromequipmen t withi n th e same sourc e category . Congres s selecte d th e 10/2 5 ton s pe r yea r threshol d base d o n th e commo n sens e vie wtha t al l th e emission s froma plan t sit e contribut e t o healt h and environmenta l threats . EPA' s programensure s tha t ai r toxic s control s ar e require d fo r al l industria l an d commercia l plan t site s tha t emi t majo r amounts . Thi s woul d no t b e tru e unde r th e suggeste d alternative , whic h woul d carv e plant s int o piece s an d conside r whethe r eac h piec e emit s majo r amounts . Tak e fo r exampl e a facilit ytha t emit s multipl e HAP s and i s compose d o f thre e 20-to n source s i n differen t sourc e categories
. Unde r th e suggeste d alternative , thi s facilit y woul d b e considere d t o b e a tri o o f are a sources . I t woul d b e exemp t from

majo r sourc e control s although it s toxi c emission s woul d tota l 6 0 ton s a yea r - - fa r abov e th e 25-to n majo r sourc e threshold . Thi s woul d no t resul t i n a credibl e ai r toxic s programno r satisf ypubli c concern s abou t toxi c emissions
. Wit h regar d t o are a sources , EP Aha s mad e finding s unde r sectio n 112(c)(3 ) fo r th e are a source s EP Aha s regulated . EP Ai s workin g t o ensur e tha t MAC T requirement s ar e reasonabl e and cost-effective
. Th e Agenc yi s usin g tool s availabl e unde r th e statut e - - suc h a s applicabilit y cutoffs , subcategorizatio n and emission s averagin g --t o achiev e thi s result . EP Ai s willin g t o explor e concept s suc h a s broade r emission s averagin g withi n plan t site s t o provid e additiona l flexibility
.



### 3 0Issue 5 : Ne w an dExistin

g Sourc e MAC T for Categorie s o f Majo r Source s - Ne

w sourc e MAC T for categorie s o f majo r source s mus t onl y

appl y t o constructedo r reconstructed majo r source s (i.e. , a greenfiel dmajo r sourc e or th e reconstructio

no f a t leas t 50 % o f anexistin g majo r source) . Similarly , existin g sourc e MAC T for categorie s o f majo r source s applie s to existin g major sources an

dmodified

major sources. Sectio

n112(g ) i s th e gatekeepe r tha t determine s whethe r an dwher e ne

w an dexistin

g sourc e MAC T for categorie s o f majo r source s appl y

- - i.e. , sectio

n112(g ) guide s th e identificatio

no f majo r sourc e construction s an d reconstruction s to whic hne w sourc e MAC T applies , an d majo r sourc e modification s t o whic hexistin g sourc e MAC T applies . Response :

• EP Aha s agree d t o discus s th e relationshi p o f sectio n 112(g ) t o section s 112(d ) and 11 2 (j ) i n upcomin g meeting s wit h litigant s o n thi s issue , a s wel l a s wit h othe r stakeholders .

• I n EPA' s view , fo r purpose s o f 112(d ) and 11 2 (j ) ne wsourc e MAC T applie s whe n a n affecte d sourc e i s constructe d o r reconstructed . Th e scop e o f th e affecte d sourc e i s define d i n eac h MAC T standard , afte r notic e and comment . Thi s approac h provide s flexibilit yt o tailo r th e applicabilit yo f ne wsourc e MAC T t o th e sourc e categoryi n question
.

• Althoug h th e Agency' s interpretatio n o f th e statut e differ s fromth e alternativ e interpretatio n above , EP Aagree s tha t ne wsourc e MAC T shoul d b e applie d t o unit s fo r whic h ne w sourc e MAC T i s reasonable . Wher e appropriate , EP Aha s define d th e "affecte d source " broadly , preventin g smal l change s a t existin g source s frombein g subjec t t o ne wsourc e MACT . EP Abelieve s tha t propose d and promulgate d MAC T standard s woul d appl yne wsourc e MAC T t o appropriat e units , bu t i s willin g t o conside r an d discus s an

yinformatio n t o th e contrary .

• EP Ai s carefull yconsiderin g voluminou s comment s o n thi s issu e tha t wer e receive d durin g th e publi c commen t perio d o n th e propose d sectio n 112(g ) rule . Th e Agenc yi s considerin g a ver ybroa d definitio n o f majo r sourc e fo r purpose s o f tha t rule , whic h woul d limi t th e applicabilit yo f ne wsourc e MAC T fo r tha t rule .

3 1Issue 6 : Consistency Amon g Ke y Sectio n11 2 Program

s - Th e thre e MAC T standar

dsettin

g provision s - section s 112(d) , (g) , an d(j ) - mus t b e co-extensive . Tha t is , a majo r sourc e wit ha sectio n112(g ) case-by-cas e MAC T limitatio

nb y definitio

nsatisfie s subsequen t 112(d ) or (j ) MAC T requirements . Likewise , a majo r sourc e wit ha sectio n112(j ) MAC T limitatio nb y definitio

nsatisfied subsequen t section s 112(d ) requirements . Response :

• Thi s issu e i s par t o f th e ongoin g litigatio n o n th e sectio n 112(j ) rule . EP Awil l addres s i t i n th e contex t o f tha t litigation
. A II . DETERMINING POTENTIAL T O EMI T * Issue 7 : Potentia l t o Emi t - - Al l control s an dlimitation s (includin

g voluntar

y control s approvedb y th e State ) mus t be consideredwhe ndeterminin g th e potentia l to emi t BAP s unde r sectio n11 2 - - no t jus t thos e tha t ar e federall y

enforceable . Response :

• Thi s topi c i s addresse d unde r th e potentia l t o emi t issue s section
. Issu e 8 : Fugitiv

e emission s may

no t b e consideredfor purpose s o f determinin

g a source' s potentia l t o emi t unde r sectio n11 2 unti l EP

A conduct s a sectio

n302(j ) rulemaking . Response :

• Thi s topi c i s addresse d unde r th e fugitiv e emission s issue s section
. III . MAC T STANDAR D SETTIN G ISSUE S Issue 9 : The MAC T Floo r for Ne w Majo r o r Are a Source s mus t b e se t a t th

e emission s limitatio nachievedb

y th e bes t controlledsimila r sourc e i nth e sam e sourc e category . Response :

• I n genera l EP Aagree s wit h thi s issue
. Whil e th e Clea n Ai r Ac t allow s EP At o selec t th e bes t controlle d simila r sourc e (withou t limitatio n t o a sourc e withi n th e regulate d sourc e category) , thi s sourc e i s almost , alway s goin g t o b e foun d i n 3 2 «th e sourc e categorybein g regulated . EP Ai s no t awar e o f

situation s wher e i t ha s gon e outsid e th e regulate d sourc e categoryfo r ne wsourc e MACT . Issue 10 : The MAC T Floor fo r Existin

g Majo r or Are a Source s - First , th

e MAC T floor fo

r existin

g source s mus t b e se t a t th e averag e emission s limitatio nachievedb

y al l o f th e bes t performin

g 1 2 percen t o f source s l nth e relevan t sourc e categor y or , for categorie s wit hfewe r tha n3 0 sources , th

e averag e emission s limitatio n achievedb

y al l o f th

e bes t performin

g 5 source s i nth

e relevan t sourc e category . Second , i f dat a i s no t availabl e o

never y sourc e i nth

e category , EP

A mus t demonstrat e tha t th e floor tha t i s calculatedo nth e basi s o f th

e partia l dat a i s th e sam e a s th e floor tha t woul db e calculatedi f dat a wer e availabl e onever y sourc e inth

e sourc e category . Additionally , EP A mus t validat e al l dat a usedto suppor t a MAC T floor determinatio

nto ensur e it s quality . Response :

• Th e Clea n Ai r Ac t state s tha t th e MAC T floo r fo r existin g source s mus t b e base d o n th e averag e emissio n limitatio n achieve d b

yth e bes t performin g 12 % o f th e source s i n th e regulate d sourc e category . Th e term "all " doe s no t appea r i n th e Act . EPA' s approac h t o determinin g th e MAC T floo r wa s develope d afte r a ver yope n discussio n and EP Aha s no t bee n litigate d ove r thi s issue
. I n eac h rule , EP Adevelop s th e dat a use d t o suppor t th e MAC T floo r and it s validit yand us e ar e subjec t t o revie wand comment .

• A s state d i n th e Federa l Registe r notic e enunciatin g EPA' s positio n o n determinin g th e MAC T floo r (59FR29200) , EP A plan s t o retai n it s discretio n i n settin g MAC T floors . Fo r example , th e CA

Aauthorize s EP At o establis h subcategorie s o f sources , whic h result s i n a separat e floo r determinatio n fo r source s i n th e subcategory . Issue 11 : The Theoretica l "Superfacility " (EP A "Mode l Plant" ) - - New an dexistin

g sourc e MAC T floor s ar e base do nth e averag e emissio

nlimitatio

nachievedb

y majo r source s i nth e relevan t sourc e category . I nothe r words , MAC T limitation s ar e no t separatel y calculatedfor eac h emissio nuni t o f majo r source s i nth e sourc e categor

y suchtha t onl y

a fictiona l "superfacility " cancompl y withou t installin

g additiona l controls . Response :

• EP Ai s usin g th e bes t informatio n i t ca n gathe r i n developin g MAC T floors . Usuall yth e bes t informatio n EP A ca n obtai n i s o n a n emissio n uni t byemissio n uni t basis
. 3 3Wit h thi s informatio n EP Adetermine s th e MAC T floo r fo r th e

emissio n unit
. I f industryrepresentative s believ e EP A shoul d us e a n emission s databas e base d o n plant-wid e estimate s t o establis h MAC T floor s and the n MACT , EP Ai s willin g t o discus s thi s approac h t o hel p affecte d industrie s collec t th e appropriat e dat a neede d fo r thi s approach . IV . ADDITIONAL SECTION11 2 IMPLEMENTATIONISSUE S Sectio n 11 2 Genera l Provision s Issue 12 : The sectio n11 2 Genera l Provision s shoul dappl y onl y a s expressl y

specifiedi neachpromulgatedMAC T standard . Response :

• EP Aagree s and i s attemptin g t o d o thi s already . Issu e 13 : BAP s shoul db e liste db y regulatio

nan da procedur e shoul db e providedb y whic hpollutant s may b e delisted i f a napplican t demonstrate s tha t a liste dHA P alone , or i na particula r use , doe s no t pos e a threa t to publi c healt hor th e environment . I f ne w HAP s ar e addedto th

e list , the

y mus t no t b e subjec t to regulatio

nunde r previousl y promulgatedMAC T standards . Response :

• Th e Clea n Ai r Ac t contain s provision s t o delis t HAP s from th e lis t i n sectio n 112(c) . EP Aha s develope d a se t o f procedure s an

d provide d thos e t o th e public
. EP Aha s use d thes e procedure s t o evaluat e delistin g petition s suc h a s th e pendin g caprolacta mpetitio n a s calle d fo r unde r th e Act . A s a result , EP Ai s no wplannin g t o delis t caprolactam .

• Wit h respec t t o "particula r use, " EP Abelieve s th e Ac t provide s tha t HAP s ar e eithe r covere d o r no t covere d unde r sectio n 112 . However , sectio n 112(c ) als o provide s tha t a particula r sourc e categoryca n b e deliste d i f th e appropriat e finding s ar e made .

• Wit h respec t t o th e las t question , EP Anote s tha t ther e ha s bee n n o petition s t o lis t ne wHAPs . EP Awil l conside r whethe r existin g MAC T standard s shoul d appl yt o an ynewl y liste d HAP s a s ne wHAP s ar e listed
. EP Awoul d onl yconside r applyin g MAC T standard s t o newl yliste d HAP s afte r takin g publi c commen t and makin g fina l decision s o n th e findin g tha t suc h applicatio n i s reasonabl e and appropriat e for affecte d sources .

3 4Issu

e 14 : The definitio no f "affecte

dfacility " mus t b e consisten t wit hth

e definitio

no f majo r sourc e t o ensur e tha t th

e givenstandar

di s no t applicabl e t o are a source s or othe r categorie s o f majo r sources . Response :

• EP Ause s th e term"affecte d source " t o clearl ydefin e whic h equipmen t ar e affecte d b yth e MAC T standards . Th e substanc e o f thi s issu e i s handle d unde r Issue s 2 , 3 , and 4 o f thi s section
. Issue 1 5 Existin

g majo r source s mus t no t b e subjec t to ne w sourc e MAC T whe nmodified . Response :

• EP Aagree s tha t existing source s ar e no t subjec t t o ne w sourc e MAC T whe n modified
. Whe n a larg e readil ysegregate d uni t o r collectio n o f equipmen t i s constructe d (readil y identifie d b

yth e State s an

d th e publi c a s a ne waffecte d source) , however , thi s equipmen t ca n b e define d a s a ne w sourc e and therefor e subjec t t o ne wsourc e MAC T unde r sectio n 112(d) . Generall yEP Aha s define d "affecte d sources " broadly , thu s eliminatin g smal l change s a t existin g source s from

bein g subjec t t o ne wsourc e MACT . Fo r exampl e i n th e Hazardou s Organi c NESHA P (HON) , EP Adefine s th e chemica l manufacturin g proces s uni t fo r purpose s o f settin g wha t piece s o f equipmen t ar e subjec t t o ne wsourc e MAC T requirements
. Issue 16 : Nonapplicabilit y determination s mus t no t b e required . Response :

• EP Agenerall yagree s wit h thi s issu e base d o n a n initia l revie wo f 4 0 CF R 63.1(b)(3) . EP Aha s discusse d thi s issu e wit h affecte d interest s an d plan s t o revie wand , perhaps , revis e thi s requiremen t i n ligh t o f recen t discussion s o n potentia l t o emit
. Issue 17 : Source s mus t b e abl e t o bypas s for brie f period s durin g malfunctionwhil e minimizing emission s i nth e exten t feasible . Response :

• Whethe r a bypas s actio n i s permissibl e o r a violatio n depend s o n th e definitio n o f malfunctio n and th e factua l circumstance s o f th e action
. Th e definitio n i n th e Genera l Provision s govern s althoug h specifi c standard s ma ysupersed e th e Genera l Provisions
. I f a n operato r experience s a 3 5 « *sudden , infrequen t and no t reasonabl ypreventabl e event ,

the n activitie s (suc h a s bypassin g contro l system ) ar e permissibl e provide d th e operato r take s actio n t o minimiz e emissions
. Generally , activitie s suc h a s bypasse s woul d b e addresse d i n th e startup , shutdown , an d malfunctio n plan . Issu e 18 : Startup , shutdown , an dmalfunctionplan s ar e no t applicabl e requirement s tha t mus t b e include di nTitl e V operatin

g permits . Response :

• EP Aagree s tha t thes e plan s d o no t nee d t o b e include d i n a Titl e V permit
. Th e requiremen t t o hav e th e plan s an d th e criteri a governin g th e adequac yo f th e plan s ar e reference d fro mth e applicabl e requirement s i n th e MAC T Genera l Provisions
. Th e plan s and action s require d b yth e plan s ca n b e enforce d independen t o f th e Titl e V permit
. Modificatio n Provision s fSection 112(g) 1 Issu e 19 : Sectio n 112(g ) mus t no t becom e effectiv

e unti l 1 8 month s afte r promulgatio n o f th e sectio

n112(g ) regulatio n or unti l th e relevan t Stat e promulgate s a rul e t o implemen t sectio n112(g) , whicheve r i s later . Response :

• EP Arecognize s tha t state s and industrynee d lea d tim e t o b e abl e t o implemen t sectio n 112(g) . Th e effectiv e dat e o f th e sectio n 112(g ) programalread yha s bee n delayed . EP A publishe d a n interpretiv e notic e i n Februaryindicating tha t state s an

d industryd o no t hav e t o implemen t sectio n 112(g ) EP Aissue s a fina l rule . I n developin g th e fina l 112(g ) rule , EP Awil l conside r th e nee d fo r lead time fo r stat e developmen t o f sectio n 112(g ) programs . EP Ai s ope n t o considerin g a reasonabl e time perio d afte r promulgation
. Issu e 20 : Sectio n 112(g ) mus t no t appl y to stationar

y source s tha t ar e no t includedi na sectio n112(c ) categor

y o f majo r sources . Response :

• EP Abelieve s section s 112(c ) and 112(g ) ar e mean t t o appl y broadl yt o al l majo r source s o f toxi c ai r emissions
. Al l categorie s tha t contai n majo r source s ar e mean t t o b e liste d o n th e sourc e categorylist
. EP Arecognize s th e nee d t o amend th e lis t i f i t find s source s tha t ar e no t i nliste d categories
. I n th e interim , sectio n 112(g ) ensure s contro l o f toxi c emission s fromconstructed , reconstructed , and modifie d majo r source s i n th e category . Th e fac t tha t EP A 3 6P.3 9

ha s inadvertentl yoverlooke d a sourc e categoryshoul d no t mea n tha t citizen s los e th e protectio n fromtoxi c emission s tha t i s provide d b

ysectio n 112 (g) . Issu e 21 : Researchand developmen t facilitie s shoul db e exempt fro m sectio

n112(g) . Response :

• EP A receive d manycomment s expressin g thi s concerndurin g th e publi c commen t period
. EP A i s workin g o n alternativ e approache s t o exemptin g researc h and developmen t facilitie s i n th e fina l rule . Issue 22 : Broadan

dself-implementin

g exclusion s mus t b e provided t o effectuat e Congressiona l inten t tha t onl y significan t change s shoul dtrigge r th e applicationo f existin g sourc e MACT . A

nexclusio

nfor operation s tha t th e majo r sourc e i s designedto accommodat e i s essentia l to th

e workabilit y

o f sectio

n112 . Source s ar e "designe

dto accommodate " an y activity

tha t i s permissibl e unde r th e source' s desig

nspecification s or Titl e V operatin

g permi t applicationo r permit . Response :

• Th e "designe d t o accommodate " languag e i n th e sectio n 112(g ) propose d rul e wa s th e resul t o f intensiv e collaborativ e thinkin g amon g EP Astaf f an d th e Clea n Ai r Ac t Advisor y Committee
. Thi s issu e als o receive d voluminou s commen t durin g th e publi c commen t period
. EP Ai s considerin g thos e comment s a s th e fina l rul e i s developed .

• EP Adoe s no t believe , however , tha t i t i s appropriat e t o automaticall yexemp t thos e change s tha t ar e represente d onl y i n a permi t application , bu t no t i n a n approve d permi t whic h ha s no t bee n reviewe d b yth e stat e o r EPA . Issue 23 : Reasonabl e emissio nestimatio

ntechnique s mus t b e adoptedtha t realisticall y asses s whethe r a propose d chang e wil l caus e a nemission s increase . Response :

• EP A understand s th e concer n tha t i t o r a permittin g authorit ycoul d second-gues s th e methodologyuse d i na d e minimi s determinatio n afte r th e fact , an dpossibl y

then bring enforcemen t action . EP A intend s t o addres s thi s concerni nth

e fina l rul e mor e directl y thanwa s done at proposal . EP

A i s lookin

g for a wa

y for source s t o hav e mor e certaint ytha t thei r emissio n estimate s wil l b e acceptable .

3 7Issu e 24 : D e minimi s emissio n level s mus t b e establishe d a t 1 0 ton s pe r yea r unles s i t i s demonstrate d tha t a lowe r leve l i s necessar yt o protec t huma n healt h o r th e environment
. Anyd e minimi s leve l mus t b e measurable. . Response :

• A t proposal , man yd e minimi s level s wer e se t a t 1 0 tons . Pollutant s o f relativel yhighe r toxicit ywer e give n lowe r d e minimi s value s base d upo n greate r hazard . EP Ai s carefull y considerin g comment s receive d o n thi s issue , includin g th e concer n tha t emission s b e measurable , a s state d above .

• I n orde r t o addres s th e concer n tha t smal l change s no t overwhel m

th e system , EP Aha s provide d numerou s othe r exclusions , suc h a s thos e fo r rawmaterial s switche s ("operation s th e majo r sourc e i s designe d t o accommodate" ) * and thos e fo r productio n rat e increase s and routin e maintenance , repair , and replacement . Issu e 25 : Asimple , streamline d offse t procedur e i s require d

unde r sectio n 112(g)(1) . Source s onl ynee d t o submi t a n "offse t showing " - preapprova l i s no t required
. Source s mus t b e abl e t o clai moffse t credit s fo r reduction s take n unde r othe r program s and source s mus t b e abl e t o tak e credi t fo r shutdown s and curtailments
. Response :

• Rathe r tha n requir e preconstructio n revie wo f offsets , a s i s require d fo r case-by-cas e MAC T determinations , th e proposa l onl yrequire s pre-operatio n revie wo f offsets . EP Adi d no t intend tha t thi s revie wb e onerous . Howeve r i n th e fina l rule , EP Aintend s t o addres s th e concer n tha t th e offse t procedure s b e simple r an d mor e straightforward
.

• A s state d above , EP Ai s considerin g adoptin g a broa d definitio n o f majo r sourc e tha t provide s maximu mflexibilit y fo r offsets . Shoul d EP Ad o so , th e definitio n woul d b e linke d t o a n approac h tha t allow s onl ythos e offset s whic h provid e additiona l emissio n reductions
. Issu e 26 : Modifie d majo r source s mus t hav e thre e year s afte r MAC T

i s determine d t o achiev e compliance
. Response :

• Th e propose d rul e grant s th e permittin g agency/authorit yt o determin e th e tim e nee d t o compl yo n a case-by-cas e basis
. Th e permittin g authorit yha s th e discretio n t o allo wu p t o 3 year s fo r compliance
. Commo n sens e woul d sugges t tha t ther e ar e manyMAC T emissio n limitatio n measures , suc h a s sourc e 3 8 « *P.4 1

reductio n projects , tha t ma yno t requir e 3 year s fo r compliance
.

• Th e ne wsourc e revie wprogram , fo r example , provide s n o suc h lead time fo r compliance
. MAC T standard s unde r sectio n 112(d ) requir e differen t complianc e periods , u p t o thre e year s maximum , o n a sourc e categoryb ysourc e category basis
. Therefore , EP Abelieve s i t i s reasonabl e t o gran t th e permittin g authorit ydiscretio n t o us e commo n sens e i n makin g case-by-cas e complianc e decision s - - jus t a s the yca n approv e MAC T determination s o n a case-by-cas e basis
. Issue 27 : EP

A ha s no authority

to vet o sectio

n112(g ) determination s mad e b y State s tha t hav

e received sectio n11 2 delegation . Response :

• Th e supplementa l titl e V proposa l contain s a lis t o f mor e environmentall ysignifican t permi t revision s includin g sectio n 112(g ) determination s fo r whic h EP Awil l requir e a n opportunit yt o revie wan d objec t t o th e revisio n i f appropriate
. Thi s doe s no t mea n tha t EP Aintend s t o vet o sectio n 112(g ) determinations ; bu t rathe r i s retainin g th e righ t t o d o so .

• I t i s t o th e source' s advantag e t o provid e a n EP Avet o opportunit yupfron t whe n makin g a sectio n 112(g ) determination
. Thi s i s becaus e th e titl e V operatin g permi t proces s provide s fo r EP Avet o opportunit ywhe n ne w requirement s ar e entere d int o th e permit
. I f tha t opportunit yha s bee n provided , the n th e sourc e ca n mor e confidentl yincorporat e 112(g ) requirement s int o it s permit
. EP Ai s als o considerin g way s t o reduc e th e administrativ e burde n associate d wit h suc h permi t changes . Issu e 28 : Case-by-cas e MAC T determination s mus t b e streamlined ,

b e base d o n informatio n reasonabl yavailabl e t o sources , and allo wth e us e o f MAC T for simila r sources . Response :

• EP Aagree s tha t case-by-cas e MAC T determination s shoul d b e practica l and base d o n reasonabl yavailabl e information
. EP Ai s considerin g comment s o n it s case-by-cas e MAC T guidanc e and wil l addres s thi s issu e i n th e fina l rule .

3 9P.4 2

Sectio n 11 2 (j ) Issue s 2 9 an

d30 : Application s fo

r sectio

n112(j ) limitation s ar e due 1 2 month s afte r th

e sectio

n11 2 (j ) deadline (i.e. , 3 0 month s afte r th

e sectio

n112(e ) schedule

dpromulgation date) . Sourc e categor y applicability

mus t b e defined befor e th

e sectio

n112(j ) deadline s o tha t source s hav e notic e tha t sectio n112(j ) applies . Response : Thes e issue s ar e par t o f th e ongoing litigatio n o n th e sectio n 11 2 (j ) rule . EP Adoe s nee d t o understand th e issu e bette r an

d wil l addres s i t i n th e contex t o f th e litigation
. I n th e fina l sectio n 11 2 (j ) rule , EP Acommitte d t o sharing informatio n wit h source s a s th e sectio n 11 2 (j ) deadlin e approache s an

d informatio n abou t a sourc e categoryha s bee n gathered , o r EP Aha s mad e a presumptiv e MAC T determination
. EPAintend s t o wor k wit h stakeholder s shoul d sectio n 11 2 (j ) eve r becom e a realit yfo r a sourc e category .

4 0P.4 3

EPA' S RESPONS E T O ISSUE S RAISED BYINDUSTR YO N CLEA N AI RAC T IMPLEMENTATIO N REFOR M EnhancedMonitorin

g Issu e 1 : •
• EPA' s proposed"enhance dmonitoring " ("EM" ) regulation s hav e a numbe r o f seriou s flaw s tha t hav

e no t beenadequatel y addressedb

y th e Agency . • The proposedprogra m focuse s improperl y o nmonitorin

g to detec t smal l change s i nemissions , whic hmay be th e resul t o f th

e norma l variabilit y associatedwit hth e underlyin

g process , emissio ncontro l technology , an d analytica l methods , rathe r tha no nmonitorin

g t o detec t large , an

denvironmentall y

significant , exces s emission s incidents .
• The proposedprogram , whic hrequire s developmen t o f complicatedan

dcontroversia l ne

w monitorin

g requirement s o

na case-by-cas e basi s throug hth e Titl e V permittin

g process , woul dimpos e hug e burden s o n industr y an dth e state ; woul d"gridlock " th e permittin

g process ; an

dwoul dinevitabl y lea dto th e impositio

nof inconsisten t requirement s o nsimila r sources . • The proposedprogra m woul dimpos e enormou s complianc e cost s o nindustry , tha t easil y coul dexceed$ 1 billion/year , wit hlittle , i f any , environmenta l benefit .
• Despit e Agency claim s to th e contrary , th

e proposed progra m woul dincreas e th e stringency

o f man y emissio

n standards , contrar

y t o law . • The proposedprogra m woul dseverel y

restric t emission s trading , averagin

g an dnetting , thereb

y compromisin

g us e o f market-basedincentive s -- a critica l too l for implementatio

no f th

e 199 0 amendments .
• Monitoring approache s tha t woul dsatisf y th e criteri a i nth e proposedrul e ar e simpl y no t availabl e for som e sourc e categorie s (e.g. , fugitiv e emissionsource s an d batc hprocesses) . Fo r othe r sourc e categorie s (e.g. , thos e subjec t to mas s limits) , companie s woul db e requiredto us e undemonstratedtechniques .
• EPA

shoul dseek a

nextensio

no f th e deadline t o engag e i na meaningfu l stakeholde r dialogue t o developa reasonabl e E M program . I norde r t o allo w tim e for thi s dialogu e t o unfold , th

e Agency

mus t seek a 1 2 mont hextensiono f th e Apri l 30 , 199 5 court-ordereddeadline . 4 1P.4 4

EPA shoul dpropos e a reasonabl e E M progra m wit hth

e followin

g elements :
• The Agency

shoul ddevelo

pa nE M progra m tha t use s legislativ

e rulemaking s - no t th e Titl e V

permi t progra m - a s th

e proces s fo

r determinin

g E M fo r an y emissio nstandar

dtha t wa s originall y established throug hrulemaking .
• A t most , th

e Agency

shoul dus e th

e current E

M rulemakin

g to articulat e criteri a for identifyin g emissio nstandard s wit hinsufficient monitoring , an d criteri a for enhancin g the m to th e poin t o f sufficiency . The Agency coul dals o us e th e curren t rulemakin

g t o establis ha schedul e wit hdeadline s for completin

g a revie

w o f existin

g standards , unde r an appropriat e prioritizatio nscheme .
• The criteri a articulatedi nthi s rulemakin g should :
• Establis ha s a goa l selectio no f monitorin

g technique s tha t wil l provide dat a sufficien t to preven t an

ddetec t large exces s emissio n incidents , whic hhav e significan t environmenta l impact , rathe r tha

nmonitorin

g technique s to detec t smal l change s i nemissions .
• Includ

e adequat e safeguard s to addres s cost s an d cost-effectivenes s (1 ) b y clearl y

providin

g fo r selectio

no f th e least-cos t methodtha t satisfie s th e criteria , an

d(2 ) b y providin

g fo r rejectio

n o f an y monitorin

g method s a s E

M tha t resul t in unreasonabl e costs .
• Requir e us e onl y o f demonstratedmonitorin g techniques . • Provide clear an dunequivoca l safeguard s t o assur e tha t change s i nmonitorin g method s wil l no t change th e stringenc

y o f th e standard . Thes e safeguard s woul dinclude requirin g consideratio

no f th e following : (1 ) th

e needfor appropriat e averagin g time s to tak

e int o accoun t variabilit y i n emissions ; (2 ) th

e needfor a chang e i nth e numerica l expressio no f standards ; an d(3 ) th

e needto establis hstart-up/shutdown/malfunctio n exemptions .

4 2P.4 5

Onc e th e criteri a an dschedul e ar e established , EP A (fo r Federa l standards ) an dth e state s (fo

r stat e standards ) woul dappl y th e criteria , and identify insufficien t monitorin g complianc e methods . Thes e standard s woul db e candidate s for rulemakin g proceeding s to enhanc e them . Response : EP Aagree s and ha s withdrawn fromth e Offic e o f Managemen t and Budge t it s propose d rul e fo r enhance d monitoring
. I t ha s receive d a 60-da yextensio n o f th e court-ordere d deadlin e and intend s t o see k a furthe r extensio n o f a t leas t a yea r afte r i t hold s a meetin g wit h intereste d stakeholders . EP Aplan s t o issu e a Federa l Registe r notic e tha t announce s th e proces s i t intend s t o follo wi n 4 « reproposin g an

d issuin g th e fina l enhance d monitorin g rule . EP Aha s withdrawn th e enhance d monitorin g protocol s from th e TechnologyTransfe r Networ k (TTN ) compute r bulleti n boar d and i n th e upcomin g Federa l Registe r notic e wil l clarif y tha t thos e protocol s ar e n o longe r applicable
. O n Ma y31 , 1995 , EP Ai s meetin g wit h representative s o f industry , state s an d environmenta l group s t o discus s furthe r option s fo r developin g a ne wflexibl e approac h fo r th e enhance d monitorin g rule . EP Ahope s t o develo p a n approac h tha t wil l buil d o n th e requirement s o f existin g rule s and ensur e tha t th e environmenta l resul t expecte d fromthos e rule s ar e bein g achieved
. On e approac h EP Ai s considerin g woul d focu s o n improvin g curren t pollutio n contro l equipmen t operatin g and maintenanc e monitorin g requirements
. A n enhance d operatin g and maintenanc e monitorin g protoco l woul d requir e tha t a sourc e owne r provid e documentatio n tha t i t ha s operate d and maintaine d a pollutio n contro l devic e o r proces s operatio n i n accordanc e wit h established , reliabl e operatin g and maintenanc e practice s and tha t an ynecessar ycorrectiv e action s hav e bee n implemente d t o ensur e tha t emission s hav e bee n reduced . A t th e Ma y3 1 stakeholder s meeting , EP A anticipate s discussin g thi s optio n a s wel l a s anyothe r option s o r issue s raise d bystakeholders .



### 4 3^.4 6

EPA' S RESPONS E T O ISSUE S RAISE D BYINDUSTR

YO N CLEA N AI RAC T IMPLEMENTATIO N REFOR M Potentia l to Emi t Issue 1 : Federa l Enforceability : EP A shoul deliminat e "Federa l enforceability " i ndeterminin g a source' s potentia l to emi t because :

- - The requiremen t ha s no lega l basis .

- - The requiremen t needlessl y force s source s wit hreal worl dmaximu

m emission s potentia l belo w th e statutor

y threshold s to compl y wit hth

e burdensom

e requirement s designedfor "major " source s or to attemp t t o rende r existin g control s an

dlimitation s "federall y enforceable " b

y enterin

g a tediou s an

dcostl y

- - an d oftenunavailabl e - - federa l documentatio nprocess . Moreover , existin

g source s fac e length y an dcostl y delay s whe nmaking evenroutine change s becaus e o f th e needto creat e or revis e "federall y enforceable " restrictions .

- - The requiremen t force s state s to expen dsignifican t tim e an dresource s to develo pan dadministe r processe s fo r non-majo r source s t o rende r control s an d limitation s "federall y enforceable. "

- - The requiremen t i s unnecessar y fo r effectiv

e enforcement . State s an dlocalitie s ca

nenforc e restriction s impose db y thei r law

s an dpermits . Moreover , i f a sourc e operate s abov e a statutor

y threshol dwithou t complyin g wit happlicabl e "major " sourc e requirements , EP A an dcitizen s hav

e enforcemen t tool s available . Response :
• EP A i s currentl y

inlitigatio

no nth e federa l enforceability issue . I ntha t litigatio nEP A ha s take

nth e positiontha t i t ha s lega l authority t o requir e federa l enforceability . • Equall y

important , EP

A believe s tha t th

e provisionfor federa l enforceability make s sense . For source s tha t hav e th e capability

t o emi t majo r amounts , an davoi dfedera l permit s an

dfedera l emissio

nreductio

nrequirement s b

y restrictin

g thei r operations , EP A believe s i t i s reasonabl e t o ensur e adherenc e t o thos e restriction s b y providin

g tha t the y be enforceabl e b

y th e federa l governmen t an dcitizens . The requiremen t for federa l enforceability increase s th

e credibility

of th e syste m b y givin g EP A th e opportunity

t o addres s pattern s o f noncompliance . I t als o provide s citizen s a

nopportunity

t o ensur e tha t source s i nthei r 4 4communitie s ar e no t inappropriatel yavoidin g requirement s

that , i f complie d with , woul d decreas e exposure s t o hazardou s pollutants .

• Ther e ar e manyway s t o ensur e tha t th e creatio n o f federall y enforceabl e restriction s doe s no t creat e a burde n o n . industry
. I n a January25 , 199 5 guidanc e memorandum , EP A identifie d approache s suc h a s genera l rule s and genera l permit s tha t allo wrestriction s t o b e create d fo r larg e number s o f source s withou t havin g t o resor t t o individua l permits
. T o ensur e tha t state s hav e sufficien t tim e t o implemen t an

yneede d approaches , EP Aha s provide d a two-yea r transitio n period
. Unde r thi s transitio n policy , source s emitting les s tha n 5 0 percen t o f th e majo r sourc e threshol d woul d no t b e require d t o ge t permit s bu t mus t onl ykee p record s reflectin g thei r actua l emissions
. Source s emittin g mor e tha n 5 0 percen t o f th e majo r sourc e threshold , and fo r whic h ther e ar e stat e permit s limiting thei r emission s t o les s tha n majo r amounts , can submi t a certificatio n acceptin g th e stat e limit s a s federall yenforceable . Issu e 2 : Th e transitio n polic yannounce d byEP Ao n January2 5 i s

no t a n adequat e respons e t o th e publi c an dprivat e burden s impose d byth e "federa l enforceability " requirement
. Response :

• EP Abelieve s tha t th e transitio n polic yeliminate s an y short-termadministrativ e burde n tha t woul d b e impose d b y th e requirement
. Th e polic ydoe s requir e source s emittin g les s tha n th e 5 0 percen t threshol d t o kee p appropriat e record s o f thei r operation s sufficien t t o demonstrat e tha t th e 5 0 percen t leve l i s bein g adhere d to . I n mos t cases , suc h record s wil l b e relate d t o th e amoun t o f material s use d o r processe d and shoul d no t requir e an yne wrecordkeepin g activities
. EP Adoe s no t intend t o second-gues s th e actua l emission s finding s o f source s an d states . Source s tha t ar e ver yclos e t o th e majo r sourc e threshol d mus t merel ycertif y tha t the yhav e a permi t tha t effectivel yrestrict s emission s and accep t th e limit s i n th e permi t a s federall y enforceable .

• EP Abelieve s tha t th e variou s approache s t o eliminatin g th e burde n ove r th e longe r term(limitation s byrule , genera l permits , clarification s regardin g realisti c worst-cas e activities ) shoul d b e i n plac e b yth e end o f th e transitio n period
. EP Ai s ope n t o reviewin g thi s assessmen t a s th e end o f thi s 2-yea r perio d approaches . EP Ai s als o givin g seriou s consideratio n t o permanentl yextendin g th e exemptio n fo r source s emittin g les s tha n th e 5 0 percen t cutoff .



### 4 5 « AP.4 8

Issue 3 : EP

A shoul ddevelo

pgenera l principle s for realisti c determination s o f "maximu m desig ncapacity " whic h recogniz e inherent physical , operational , an dothe r restrictions- . Response :

• EP Aagree s tha t realisti c assumption s o f thi s natur e nee d t o b e mad e an

d ha s initiate d a n effor t t o evaluat e severa l categorie s o f smal l source s (grai n elevators , ga s stations , automobil e bod

yshops , and emergenc ygenerators) . EP A plan s t o follo wu p thi s effor t wit h mor e genera l guidanc e o n principle s tha t ca n b e use d t o evaluat e additiona l categories
. Issue 4 : EP

A shoul dallo

w source s to rel y

o nobjectivel y reasonabl e estimate s o f potentia l t o emit , an dissue presumptivel y

acceptabl e method s for estimatin g potentia l emissions . Response : EP Aagree s tha t source s shoul d us e objectiv e and reasonabl e methods , and tha t a genera l hierarch yfo r thes e method s ha s bee n established
. Source-specifi c testing i s generall y preferred . Wher e n o source-specifi c informatio n i s availabl e o r feasibl e t o obtain , test s o n simila r facilitie s o r emissio n factor s ca n b e used . Issu e 5 :

Response : EP

A shoul dadop t a

nenforcemen t policy whic hdoe s no t penaliz e a sourc e whe npos t ho c applicatio no f an updatedestimatio

nmethodresult s i na determination tha t th e source' s potentia l to emit , a s calculated today , woul dexceeda napplicabl e threshold , wher e relianc e o

nth e prio r estimatio

nmethodwas , a t th e time , objectivel y

reasonable .
(Refe r t o Issu e 2 i n th e Operatin g Permi t Programsect i fo r respons e t o thi s issue. ) o n

4 6EPA' S RESPONS E T O ISSUE S RAISED BYINDUSTR YO N CLEA N AI RAC T IMPLEMENTATIO N REFOR M Fugitiv e Emission s Issue 1 : EP

A mus t appl y

th e 302(j ) rulemakin

g requiremen t acros s th e boardto al l Clea nAi r Ac t programs tha t appl y t o majo r sources , includin g th e sectio

n112 , titl e V , PSD , an dnonattainmen t NSR . Response :
• EP A continue s t o conduc t sectio n302(j ) rulemaking s wher e require dunde r th

e Act , but EP

A believe s sectio

n11 2 doe s no t requir e sucha rulemaking . A cour t decisiono

nthi s lega l issu e shoul d be issue dshortly . EP

A i s interestedi n hearin g specifi c concern s abou t th e technica l feasibility o f measurin g fugitiv e HA P emissions , and i n providin g guidanc e i n thi s area . Issue 2 : Ina sectio n302(j ) rulemaking , EP A mus t demonstrat e tha t th e benefit s o f regulatin g a sourc e o f fugitiv e emission s woul doutweig hth e cost s o f suchregulation . Response :

• EP Ahistoricall yha s considere d economi c feasibilit yi n rulemaking s conducte d unde r sectio n 302(j)
. Issue 3 : EPA

shoul dissue guidanc e regardin g th e prope r treatmen t o f co-locatedsource s o f fugitiv e emission s tha t hav

e no t beenliste

dpursuan t to sectio n30 2 (j) . EP A committe

dto issue thi s guidanc e promptl y i na Februar y 10 , 199 5 motionto th e D.C . Circuit . Response :

• EP Aha s committe d t o issu e thi s guidanc e i n Ma y 1995 . i

4 7P.5 0

Attendee s a t Meetin g wit h Assistan t Administrato r Mar yNichol s

Apri l 12 , 199 5
EPA : 1 . Mar yNichol s - OAR/I C 2 . Davi d Donige r - OAR/I C 3 . Bil l Tyndal l - OAR/I C 4 . Ro b Brenne r - OAR/I C 5 . Nanc ySutle y- O A 6 . Ala n Ecker t - OG C 7 . Michae l Wine r - OG C 8 . Gre g Foot e - OG C 9 . Lydi a Wegma n - OAQP S 10 . Jef f Clar k - OAQP S 11 . John Seit z - OAQP S 12 . Fre d Dimmic k - OAQP S 13 . Mik e Trutn a - OAQP S 14 . Ti mSmit h - OAQP S 15 . Kathi e Stei n - OECA 16 . Winsto n Smit h - Regio n I V 17 . Juli e Domik e - OEC A 18 . Ji mKetcham-Colwil l IndustryRepresentatives : 1 . Gen a Ash e - AT& T 2 . Rober t D . Bessett e - Counci l o f Industria l Boile r Owner s 3 . Doroth

yBower s - Merc k & Co . 4 . Shanno n Broom e - G E 5 . Bil l Burkhar t - Th e Procte r & Gambl e Compan y 6 . Kevi n But t - Toyota , Mg r o f Envt' l Affair s 7 . Georgi a Callaha n - Texac o Inc . 8 . Nanc yCookso n - Chemica l Manufacturer s Associatio n 9 . Te d Cromwel l - Chemica l Manufacturer s Associatio n 10 . John Deg e - E.I . duPon t d e Nemour s & Co. , Inc . 11 . Eda n Dionn e - IB M 12 . Sherr yEdward s - SOCM A 13 . Michae l Faulkne r - Fluo r Danie l 14 . Josep h Flahert y- Kaise r Aluminu m 15 . Davi d Friedland - Beveridg e & Diamond 16 . Barr yGarelic k - Sola r Turbines , Inc . 17 . Denis e Gran t - Chemica l Manufacturer s Associatio n 18 . Juli a A . Hatche r - Latham& Watkin s 19 . Mauree n Heale y- Th e Societ yo f th e Plastic s Industry , Inc , 20 . Patrici a Hil l - Georgia-Pacifi c Corporatio n 21 . Josep h C . Hoviou s - Unio n Carbid e 22 . Mik e Innerarit y- Tennec o Ga s 23 . E d Jaffe e - PrimaryGlas s Manufacturer s Counci l 24 . Dougla s Klieve r - Cleary , Gotlie b
WA01/213129. 1P.5 1 f .,.• ;

25 . Chuc k Knaus s - Swidle r & Berli n

26 . Kari l Kochendorfe r - America n Textil e Manufact . Institut e 27 . Theres a K . Larse n - Nationa l Associatio n o f Manufacturer s 28 . Bil l Lewi s - Morgan , Lewi s & Bockiu s 29 . A . Wal t Lon g - Owens-Illinoi s 30 . Ke n Markowit z - Kilpatric k & Cod y 31 . Jac k McClur e - Shel l Oi l Compan y 32 . Michae l McCor d - Morgan , Lewi s & Bockiu s 33 . Joh

n Medle y- Mobi l Oi l Corporatio n 34 . Ti mMohi n - Inte l Governmen t Affair s 35 . JeffryC . Muffa t - 3 M 36 . Henr yNicke l - Hunto n & William s 37 . Frank Parte e - For d Moto r Co. , Dearborn , M I 38 . Pau l Patli s - Unite d Technologie s Corporatio n 39 . Bil l Pederse n - Shaw , Pittma n 40 . Dic k Penn a - Va n Nes s Feldma n 41 . Richar d C . Phelp s - Eastma n Chemica l Compan y 42 . Michae l Pucc i - AT& T 43 . Patric k Rahre r - Hoga n & Hartso n 44 . John E . Rees e - America n Petroleu m Institut e 45 . Lesli e Ritt s - NEDA/CAR P 46 . Arlin e M . Seege r - Morgan , Lewi s & Bockiu s 47 . Ev a Seydel l - Unite d Technologie s Corporatio n 48 . Qui n She a - Nationa l Minin g Associatio n 49 . Elle n Siegle r - America n Petroleu m Institut e 50 . Susa n Smit h - Owens-Illinoi s 51 . Core ySnyde r - Th e Procte r & Gambl e Compan y 52 . Scot t Style s - Ai r Product s an d Chemical s 53 . Bria n Tarant o - Exxo n Chemica l 54 . Din a Vizzaccarr o - AAMA , Washingto n Offic e 55 . Rasm

a I . Zvaner s - Chemica l Manufacturer s Associatio n 56 . 57 . 58 . 59 .

WA01/213129. 1