Iowa Administrative Bulletin

VOLUME XXXIV , NUMBER 21 Ap ril 18, 2012 Pages 1364

- 1372

1 

### ARC 0097C ENVIRONMENTAL PROTECTION COMMISSION[567]

Notice of Intended Action Pursuant to the authority of Iowa Code section 455B.133, the Environmental Protection Commission hereby gives Notice of Intended Action to amend Chapter 33, “Special Regulations a nd Construction Permit Requirements for Major Stationary
Sources

— Prevention of Significant Deterioration (PSD) of Air Quality,” Iowa
Administrative Code. The purpose of the proposed amendments is to adopt changes to the federal regulations for Prevention o f Significant Deterioration (PSD) into Iowa’s administrative rules for air quality. The U.S. Environmental Protection Agency (EPA) finalized amendments to the PSD regulations over a three

- year period to address the revised national ambient air quality stan dards (NAAQS) for fine particulate matter that is less than or equal to 2.5 micrometers in diameter (PM 2.5 ). EPA issued the final regulation necessary for PM 2.5 implementation for the PSD program on December 21, 2010. Through this rule making, the Departme nt is also proposing a mechanism to allow industry to request rescission of a PSD permit. The proposed amendment matches federal regulations and will be a benefit to facilities that meet the qualifications for rescission of a PSD permit. Additionally, the Department is proposing an amendment to clarify under what circumstances facilities are required to keep records and the types of records that must be kept. The proposed amendment matches federal regulations and will be a benefit to facilities that must me et record

- keeping requirements. To ensure that Iowans have clean air to breathe, the Department is required by2

federal and state law to develop state implementation plans that manage outdoor air resources so that existing, new, and modified sources of air pollution do not cause or contribute to violations of the NAAQS. Community, business and industry, agriculture, and transportation activities all contribute to air pollution in the atmosphere. Appropriate plans and programs to address these contributions a re the building blocks necessary to ensure that the air Iowans breathe meets health

- based air quality standards. One of these building blocks is the federal PSD program that establishes requirements for very large sources of air pollution. The PSD program is a component of New Source Review (NSR) that includes procedures to ensure that air quality standards are maintained. The NSR program was designed to allow economic growth in harmony with the preservation of existing clean air. Requirements and limits ar e specified in preconstruction permits to protect the public from the adverse effects which might occur if sources were allowed to operate unregulated. There are three types of preconstruction air quality permitting that comprise NSR: minor, major, and non attainment NSR. Minor preconstruction permitting is for sources that emit less than either 100 or 250 tons per year (tpy) of any one air pollutant depending on the facility’s source category. Major source preconstruction permitting is for sources whose pla ntwide emissions exceed the 100 or 250 tpy threshold for any one air pollutant. Major source preconstruction permitting entails issuance of either a PSD permit or a permit to avoid PSD applicability. Lastly, nonattainment NSR preconstruction permitting

occ urs within those areas of the state that are not meeting the ambient air quality standards. Iowa currently does not have any nonattainment areas for PM 2.5 .3 The Department has administered an EPA

- approved state PSD program since 1987. In general, the PSD pr ogram requires that an affected facility obtain a PSD permit specifying how the facility will control air emissions. The permit requires the facility to apply best available control technology (BACT), which is determined on a case

- by

- case basis, taking int o account, among other factors, the cost and effectiveness of the control. Ambient air impact analyses are conducted to determine whether the proposed emission limits, controls, and operating conditions will be sufficient to prevent violations of the NAAQS and unacceptable levels of air quality deterioration. The NAAQS for PM 2.5 establish limits on the acceptable exposure and public health impacts of PM 2.5 . PM 2.5 can easily bypass most of the body’s defense mechanisms and become lodged deep in the lungs, wh ere the particles can cause coughing, difficulty breathing, or aggravated asthma; development of chronic bronchitis; nonfatal heart attacks; and premature death in people with heart or lung disease. EPA created an NAAQS in 1997 for this pollutant in order to better protect the public from the adverse impacts of PM 2.5 on human health. EPA strengthened the PM 2.5 NAAQS in 2006 based on reviews of the latest public health information and scientific data, reducing the acceptable level of PM 2.5 to which humans ca n be exposed from 65 micrograms per cubic meter of air ( μg/m 3 ) to 35 μg/m 3

. An important component to establishing the revised air quality standards for
PM 2.5 is EPA’s corresponding changes to the PSD program. EPA finalized the first of its PSD amendments for PM 2.5 implementation in May 2008 but did not finaliz e the last of the necessary updates until December 21, 2010. Now that EPA has completed the PSD amendments for PM 2.5 , the Department is proceeding with proposing necessary4

amendments to Iowa’s air quality rules for the PSD program. This rule making propose s to amend Iowa’s air quality rules to implement changes to the federal PM 2.5 regulations that EPA finalized in a phased approach over three years. This rule making addresses two EPA actions:

● On May 16, 2008, EPA publication of final rules setting PSD significant emissions rates for PM 2.5 and addressing PM 2.5 precursors; and

● On October 20, 2010, EPA publication of final rules setting PSD increments, significant impact levels (SILs), and sig nificant monitoring concentrations (SMCs) for PM 2.5 . On December 21, 2010, EPA published federal rules establishing EPA stack testing methods for PM 2.5 . The Department is proposing adoption by reference of these federal rules in a separate rule making publ ished herein under Notice of Intended Action

as ARC 0087C

. For industry to continue to receive federally acceptable PSD permits from the State, the Department must adopt these PM 2.5 requirements into administrative rules. On September 8, 2011, EPA publishe d a finding of failure of the State of Iowa to submit a State Implementation Plan (SIP) for the NAAQS for PM 2.5 . EPA’s finding became effective on October 11, 2011, and establishes a deadline for EPA to issue a Federal Implementation Plan for PM 2.5 if the outstanding SIP elements, including adoption of the PSD requirements included in these proposed amendments, are not completed. Failure to adopt PSD requirements for PM 2.5 may result in loss of the State’s PSD program, which
would cause the EPA to become th e permitting authority and would significantly increase the amount of time required for a facility to obtain a PSD permit.5 Additionally, two amendments included in the proposed rule making, the permit rescission and record

- keeping provisions, will provide regulatory flexibility to affected facilities. Failure to adopt these amendments would prevent the Department from providing these benefits to industry. Item 1 amends subrule 33.3(1) to revise the definitions of “baseline area,” “baseline date,” “enforceab le permit condition,” “federally enforceable,” “regulated NSR pollutant,” and “significant” to match the changes EPA made in 40 Code of Federal Regulations (CFR) 51.166 and 52.21 to implement the PM 2.5 NAAQS. The revised definitions match the federal defin itions in 40 CFR 51.166 and 52.21. The Department is also revising references to specific sections of the Clean Air Act to match corrections that EPA made to the CFR. Item 2 amends subrule 33.3(3) to adopt by reference EPA’s revisions to the
ambient air in crements to include thresholds for PM 2.5 . Item 3 amends subrule 33.3(9) to adopt by reference EPA’s amendments to the PSD exemptions to incorporate PM 2.5 . Item 4 amends subrule 33.3(11) to adopt by reference EPA’s revisions to the source impact analysis re quirements to include PM 2.5 . Item 5 amends subrule 33.3(16) to adopt by reference EPA’s revisions to the requirements for sources impacting federal Class I areas to include PM 2.5 . Item 6 amends subrule 33.3(18) to revise the “source obligation” provisions to match current federal PSD regulations. This amendment clarifies under what conditions source owners and operators must keep records and the specific records that must be kept. The amendment also adds the federal definition of “reasonable possibility” fo r6

purposes of keeping records under subrule 33.3(18). This amendment will allow facilities additional record

- keeping flexibility and reduce the record

- keeping burden.
Item 7 amends subrule 33.3(20) to revise the provisions for the conditions for permit iss uance to match EPA amendments that establish the PSD significance levels for
PM 2.5 . Item 8 adds new subrule 33.3(22) to establish provisions for rescinding a PSD permit. Currently, there is no mechanism in rules for the Department to rescind a PSD permit, even if PSD program requirements no longer apply to a facility. This provision was inadvertently excluded when the Department adopted amendments to PSD rules in 2006. The proposed amendment matches EPA’s regulations in 40 CFR 52.21(w). Any person may make written suggestions or comments on the proposed amendments on or before Fri day, May 18, 2012, at 4:30 p.m. Written comments should be directed to Christine Paulson, Department of Natural Resources, Air Quality Bureau, 7900 Hickman Road, Suite 1, Windsor He ights, Iowa 50324; fax (515) 242

- 5094; or by
E

- mail to christine.paulson@dnr.iowa.gov

. A public hearing will be held on Friday, May 18, 2012, at 1 p.m. in the conference rooms at the Department’s Air Quality Bureau office located at 7900 Hickman Road, Wind sor Heights, Iowa. All comments must be r eceived no later than 4:30 p.m. on Friday, May 18, 2012. Any person who intends to attend the public hearing and has special requirements, such as those related to hearing or mobility impairments, should contact Chr istine Paulson at (515) 242

- 5154 or by E

- mail at christine.paulson@dnr.iowa.gov to advise of any specific needs.7 The complete Jobs Impact Statement prepared by the Department is available from the Department upon request. The following is a summary of the Jobs Impact
Statement. After analysis and review of this rule making, there could be an impact on jobs. However, these amendments are mandated by EPA federal regulations, and the State of Iowa is not requiring additional regulations. The Department will co ntinue to work with stakeholders to minimize any adverse impact on jobs and to maximize any positive impact on jobs. One of Congress’s goals for PSD as set forth in the Clean Air Act was to allow economic growth in harmony with the preservation of existing clean air. Requirements and limits are specified in preconstruction permits to protect the public from adverse effects that might occur if sources were allowed to operate unregulated. The requirements in PSD permits help prevent areas of the state from be coming nonattainment areas. Major sources locating in or undergoing modifications in nonattainment areas must generally meet emissions requirements stricter than those called for under the PSD program. Communities in nonattainment areas attempting to meet the Clean Air Act requirements can face significant challenges that make it very difficult or impossible for businesses to locate or expand in that area. Currently, Iowa does not have any nonattainment areas for
PM 2.5 , in part because of the success of the PSD program in preventing air quality from deteriorating. Companies may locate or expand in any area of the state without the significant barriers that would be imposed by PM 2.5 nonattainment, and this may create a positive jobs impact. The Department est imated emissions control costs required for the PSD8

program’s BACT provisions. These estimates are based on three companies’ tax filings from 2009, 2010, and 2011. These costs ranged from $30,000 to $10 million and included all costs associated with equipm ent and installation. However, because BACT is also required for total particulate matter (PM) emissions and course particulate matter (PM 10 ) emissions, only one

- half to one

- third of these very generally estimated costs can be attributed to PM 2.5 . Addition ally, because EPA requires a PSD program for each state, these costs are not unique to Iowa and would likely vary little from state to state. In addition, the Department estimated costs of preparing PSD permit applications based on information from consult ants that prepare PSD applications for their clients. Total application preparation costs ranged from $25,000 to $100,000. Typically, a project does not go through PSD review for just one pollutant. Costs attributed to PM 2.5 would be only a portion of the PSD application costs, likely ranging from 15 percent to 50 percent. The PSD program is a national program imposed through the Clean Air Act, so any company locating a large, new facility or considering a major expansion in any state in the United States w ill be required to go through PSD review. Although PSD requirements are consistent across states, some of the variables include the cost to apply for a PSD permit and the turnaround time to get a PSD permit. The Department does not charge a fee for submitt ing a PSD permit application. Application fees in other states range from several hundred dollars per project to tens of thousands of dollars per project. The Department’s no

- cost PSD application process may have a positive impact on jobs. Because companie s are allowed to conduct only very limited preparatory construction activities prior to obtaining the PSD permit, it is a significant incentive for9

the company to receive the PSD permit as quickly as possible. For this reason, the Department’s no

- cost appl ication and relatively quick turnaround time may be incentives for companies to build or expand in Iowa. This may be a positive jobs impact for industrial jobs. These amendments are intended to implement Iowa Code subsections 455B.133(1), 455B.133(4), and 455B.133(5) and the U.S. Clean Air Act (CAA) Title I, Part C (CAA §160

- 169b; U.S.C. §7470

- 7492). The following amendments are proposed.

I TEM 1 . Amend the following definitions in subrule 33.3(1) : “Baseline area” means: 1. Any intrastate area (and every par t thereof) designated as attainment or unclassifiable under Section 107(d)(1)(D) or (E) 107(d)(1)(A)(ii) or (iii) of the Act in which the major source or major modification establishing the minor source baseline date would construct or would have an air qu ality impact equal to or greater than 1 ug/m 3 (annual average) of the pollutant for which the minor source baseline date is established for the pollutant for which the baseline date is established, as follows: equal to or greater than 1 μg/m

3 (annual average) for sulfur dioxide (SO 2 ), nitrogen dioxide (NO 2 ) or PM 10 ; or equal to or greater than 0.3 μg/m 3 (annual average) for PM 2.5 . 2. Area redesignations under Section 107(d)(1)(D) or (E) 107(d)(1)(A)(ii) or (iii) of the Act cannot intersec t or be smaller than the area of impact of any major stationary source or major modification which establishes a minor source baseline date or is subject to regulations specified in this rule, in 40 CFR 52.21 (PSD requirements), or in department rules appr oved by EPA under 40 CFR Part 51, Subpart I, and would be10

constructed in the same state as the state proposing the redesignation.
3. Any baseline area established originally for the total suspended particulate increments shall remain in effect and shall ap ply for purposes of determining the amount of available PM 10 increments, except that such baseline area shall not remain in effect if the permitting authority rescinds the corresponding minor source baseline date in accordance with the definition of “basel ine date” specified in this subrule. “Baseline date” means: 1. Either “major source baseline date” or “minor source baseline date” as
follows: (a) The “major source baseline date” means, in the case of particulate matter
PM 10 and sulfur dioxide, January 6, 1975 , and ; in the case of nitrogen dioxide, February 8, 1988 ; and in the case of PM 2.5 , October 20, 2010

. (b) The “minor source baseline date” means the earliest date after the trigger date on which a major stationary source or a major modification subjec t to 40 CFR 52.21 as amended through November 29, 2005, October 20, 2010, or subject to this rule (PSD program requirements), or subject to a department rule approved by EPA under 40 CFR Part 51, Subpart I, submits a complete application under the relevant regulations. The trigger date for particulate matter PM 10 and sulfur dioxide is August 7, 1977. For nitrogen dioxide, the trigger date is February 8, 1988. For PM 2.5 , the trigger date is October 20,
2011.
2. The “baseline date” is established for each pol lutant for which increments or other equivalent measures have been established if: ( a) The area in which the proposed source or modification would construct is11

designated as attainment or unclassifiable under Section 107(d)(i)(D) or (E) 107(d)(1)(A)(ii) or (iii) of the Act for the pollutant on the date of its complete application under 40 CFR 52.21 as amended through November 29, 2005, October 20, 2010, or under regulations specified in this rule (PSD program requirements); and (b) In the case of a major st ationary source, the pollutant would be emitted in significant amounts, or in the case of a major modification, there would be a significant net emissions increase of the pollutant. Any minor source baseline date established originally for the total suspen ded particulate increments shall remain in effect and shall apply for purposes of determining the amount of available PM 10 increments, except that the reviewing authority may rescind any such minor source baseline date where it can be shown, to the satisfa ction of the reviewing authority, that the emissions increase from the major stationary source, or the net emissions increase from the major modification, responsible for triggering that date did not result in a significant amount of PM 10 emissions. “Enfor ceable permit condition,” for the purpose of this chapter, means any of the following limitations and conditions: requirements development developed pursuant to new source performance standards, prevention of significant deterioration standards, emissions standards for hazardous air pollutants, requirements within the SIP, and any permit requirements established pursuant to this chapter, any permit requirements established pursuant to 40 CFR 52.21 or Part 51, Subpart I, as amended through November 29, 2005, October 20, 2010, or under conditional, construction or Title V operating permit rules. “Federally enforceable” means all limitations and conditions which are12

enforceable by the Administrator and the department, including those federal requirements not ye t adopted by the state, developed pursuant to 40 CFR Parts 60, 61 and 63; requirements within 567

— subrules 23.1(2) through 23.1(5); requirements within the SIP; any permit requirements established pursuant to 40 CFR 52.21 or under regulations approved purs uant to 40 CFR Part 51, Subpart I, as amended through November 29, 2005, October 20, 2010, including operating permits issued under an EPA

- approved program, that are incorporated into the SIP and expressly require adherence to any permit issued under such program. “Regulated NSR pollutant” means the following:
1. Any pollutant for which a national ambient air quality standard has been promulgated and any constituents or precursors for such pollutants identified by the Administrator (e.g., volatile organic c ompounds and NO X are precursors for ozone) ; (a) Volatile organic compounds and nitrogen oxides are precursors to ozone in all attainment and unclassifiable areas; (b) Sulfur dioxide is a precursor to PM 2.5 in all attainment and unclassifiable

areas; (c) Nitrogen oxides are presumed to be precursors to PM 2.5 in all attainment and unclassifiable areas, unless the department demonstrates to EPA’s satisfaction that emissions of nitrogen oxides from sources in a specific area are not a significant contributor to the area’s ambient PM 2.5 concentrations; (d) Volatile organic compounds are presumed not to be precursors to PM 2.5 in any attainment and unclassifiable areas, unless the department demonstrates to EPA’s satisfaction that emissions of volatile organic comp ounds from sources in a specific area13

are a significant contributor to that area’s ambient PM 2.5 concentrations;
2. Any pollutant that is subject to any standard promulgated under Section 111 of the Act;
3. Any Class I or Class II substance subject to a st andard promulgated under or established by Title VI of the Act; or
4. Any pollutant that otherwise is subject to regulation under the Act as defined in 33.3(1), definition of “subject to regulation.”
5. Notwithstanding paragraphs “1” through “4,” the defin ition of “regulated NSR pollutant” shall not include any or all hazardous air pollutants that are either listed in Section 112 of the Act or added to the list pursuant to Section 112(b)(2) of the Act and that have not been delisted pursuant to Section 112( b)(3) of the Act, unless the listed hazardous air pollutant is also regulated as a constituent or precursor of a general pollutant listed under Section 108 of the Act.
6. Particulate matter (PM) emissions, PM 2.5 emissions and PM 10 emissions shall include g aseous emissions from a source or activity which condense to form particulate matter at ambient temperatures. On or after January 1, 2011, such condensable particulate matter shall be accounted for in applicability determinations in establishing emissions limitations for PM, PM 2.5 and PM 10 in PSD permits. Compliance with emissions limitations for PM, PM 2.5 and PM 10 issued prior to January 1, 2011, shall not be based on condensable particulate matter unless required by the terms or conditions of the permit o r Iowa’s state implementation plan (SIP). Applicability determinations made prior to January 1, 2011, without accounting for condensable particulate matter shall not be considered in violation of this requirement unless the Iowa SIP required condensable14

pa rticulate matter to be included. “Significant” means: 1. In reference to a net emissions increase or the potential of a source to emit any of the following pollutants, a rate of emissions that would equal or exceed any of the following rates: Pollutant and Emissions Rate

● Carbon monoxide: 100 tons per year (tpy)

● Nitrogen oxides: 40 tpy

● Sulfur dioxide: 40 tpy

● Particulate matter: 25 tpy of particulate matter emissions or 15 tpy of PM 10 emissions

● PM 10 : 15 tpy

● PM 2.5 : 10 tpy of direct PM 2.5 emissions; 40 tpy of sulfu r dioxide emissions; 40 tpy of nitrogen oxide emissions (unless the department demonstrates to EPA’s satisfaction that emissions of nitrogen oxides from sources in a specific area are not a significant contributor to the area’s ambient PM 2.5 concentrations )

● Ozone: 40 tpy of volatile organic compounds or NO x

● Lead: 0.6 tpy

● Fluorides: 3 tpy

● Sulfuric acid mist: 7 tpy

● Hydrogen sulfide (H 2 S): 10 tpy

● Total reduced sulfur (including H 2 S): 10 tpy

● Reduced sulfur compounds (including H 2 S): 10 tpy15 ● Municip al waste combustor organics (measured as total tetra

- through

octa

- chlorinated dibenzo

- p - dioxins and dibenzofurans): 3.2 × 10 - 6 megagrams per year (3.5 × 10 - 6 tons per year)

● Municipal waste combustor metals (measured as particulate matter): 14
megagrams per year (15 tons per year)

● Municipal waste combustor acid gases (measured as sulfur dioxide and hydrogen chloride): 36 megagrams per year (40 tons per year)

● Municipal solid waste landfill emissions (measured as nonmethane organic compounds): 45 megagr ams per year (50 tons per year)
2. “Significant” means, for purposes of this rule and in reference to a net emissions increase or the potential of a source to emit a regulated NSR pollutant not listed in paragraph “1,” any emissions rate.
3. Notwithstandin g paragraph “1,” “significant,” for purposes of this rule, means any emissions rate or any net emissions increase associated with a major stationary source or major modification, which would construct within ten kilometers of a Class I area , and have an im pact on such area equal to or greater than 1 μg/m 3 (24

- hour average).

I TEM 2 . Amend subrule 33.3(3) as follows: 33.3(3) Ambient air increments. The provisions for ambient air increments as specified in 40 CFR 52.21(c) as amended through November 29, 2005, October 20, 2010, are adopted by reference.

I TEM 3 . Amend subrule 33.3(9) as follows: 33.3(9) Exemptions. The provisions for allowing exemptions from certain16

requirements for PSD

- subject sources as specified in 40 CFR 52.21(i) as amended through May 1, 200 7, October 20, 2010, are adopted by reference.

I TEM 4. Amend subrule 33.3(11) as follows: 33.3(11) Source impact analysis. The provisions for a source impact analysis as specified in 40 CFR 52.21(k) as amended through November 29, 2005, October 20, 2010,

ar e adopted by reference.

I TEM 5. Amend subrule 33.3(16) as follows: 33.3(16) Sources impacting federal Class I areas

— additional requirements. The provisions for sources impacting federal Class I areas as specified in 40 CFR 51.166(p) as amended through Nove mber 29, 2005, October 20, 2010, are adopted by reference. The following phrases contained in 40 CFR 51.166(p) are not adopted by reference: “the plan may provide that,” “the plan shall provide that,” “the plan shall provide” and “mechanism whereby.”

I TEM 6. Amend subrule 33.3(18) as follows: 33.3(18) Source obligation.

a. Approval to construct shall not relieve any owner or operator of the responsibility to comply fully with applicable provisions of the plan and any other requirements under local, state o r federal law. b. At such time that a particular source or modification becomes a major stationary source or major modification solely by virtue of a relaxation in any enforceable limitation which was established after August 7, 1980, on the capacity of t he source or modification otherwise to emit a pollutant, such as a restriction on hours of operation, the requirements of subrules 33.3(10) through 33.3(19) shall apply to the source or17

modification as though construction had not yet commenced on the sourc e or modification.

c. Any owner or operator who constructs or operates a source or modification not in accordance with the application pursuant to the provisions in rule
567

— 33.3(455B) or with the terms of any approval to construct, or any owner or operat or of a source or modification subject to the provisions in rule 567

— 33.3(455B) who commences construction after April 15, 1987 (the effective date of Iowa’s PSD program), without applying for and receiving department approval, shall be subject to appropri ate enforcement action. d. Approval to construct shall become invalid if construction is not commenced within 18 months after receipt of such approval, if construction is discontinued for a period of 18 months or more, or if construction is not completed within a reasonable time. The department may extend the 18

- month period upon a satisfactory showing that an extension is justified. These provisions do not apply to the time between construction of the approved phases of a phased construction project; each phase must commence construction within 18 months of the projected and approved commencement date.

e. Reserved. f. The Except as otherwise provided in subparagraph (8), the following specific provisions shall apply to with respect to any regulated NSR p ollutant emitted from projects at existing emissions units at a major stationary source, other than projects at a source with a PAL, in circumstances in which where there is a “reasonable possibility,” within the meaning of subparagraph (8), that a project that is not part of a18

major modification may result in a significant emissions increase of such pollutant , and the owner or operator elects to use the method for calculating projected actual emissions as specified in subrule 33.3(1), paragraphs “1” throug h “3” of the definition of “projected actual emissions.” (1) Before beginning actual construction of the project, the owner or operator shall document and maintain a record of the following information:
1. A description of the project;
2. Identification of the emissions unit(s) whose emissions of a regulated NSR pollutant could be affected by the project; and
3. A description of the applicability test used to determine that the project is not a major modification for any regulated NSR pollutant, including t he baseline actual emissions, the projected actual emissions, the amount of emissions excluded under paragraph “3” of the definition of “projected actual emissions” in subrule 33.3(1), an explanation describing why such amount was excluded, and any netting calculations, if applicable. (2) No less than 30 days before beginning actual construction, the owner or operator shall meet with the department to discuss the owner’s or operator’s determination of projected actual emissions for the project and shall pro vide to the department a copy of the information specified in paragraph “f.” The owner or operator is not required to obtain a determination from the department regarding the project’s projected actual emissions prior to beginning actual construction. (3) If the emissions unit is an existing electric utility steam generating unit, before beginning actual construction, the owner or operator shall provide a copy of the19

information set out in subparagraph (1) to the department. The requirements in subparagraph s (1), (2) and (3) shall not be construed to require the owner or operator of such a unit to obtain any determination from the department before beginning actual construction. (4) The owner or operator shall:
1. Monitor the emissions of any regulated NSR p ollutant that could increase as a result of the project and that is emitted by any emissions unit identified in subparagraph (1);
2. Calculate the annual emissions, in tons per year on a calendar

- year basis, for a period of five years following resumption of regular operations and maintain a record of regular operations after the change, or for a period of ten years following resumption of regular operations after the change if the project increases the design capacity or potential to emit of that regulated NSR pollutant at such emissions unit (for purposes of this requirement, “regular” shall be determined by the department on a case

by

- case basis); and
3. Maintain a written record containing the information required in this subparagraph. (5) The written re cord containing the information required in subparagraph (4) shall be retained by the owner or operator for a period of ten years after the project is completed. (6) If the unit is an existing electric utility steam generating unit, the owner or operator s hall submit a report to the department within 60 days after the end of each year during which records must be generated under subparagraph (4) setting out the unit’s20

annual emissions during the calendar year that preceded submission of the report. (7) If t he unit is an existing unit other than an electric utility steam generating unit, the owner or operator shall submit a report to the department if the annual emissions, in tons per year, from the project identified in subparagraph (1), exceed the baseline actual emissions, as documented and maintained pursuant to subparagraph (4), by an amount that is “significant” as defined in subrule 33.3(1) for that regulated NSR pollutant, and if such emissions differ from the preconstruction projection as documented

a nd maintained pursuant to subparagraph (4). Such report shall be submitted to the department within 60 days after the end of such year. The report shall contain the following:
1. The name, address and telephone number of the major stationary source;
2. The annual emissions as calculated pursuant to subparagraph (4); and
3. Any other information that the owner or operator wishes to include in the report (e.g., an explanation as to why the emissions differ from the preconstruction projection). (8) A “reasonab le possibility” under this paragraph (paragraph 33.3(18) “f” ) occurs when the owner or operator calculates the project to result in either:
1. A projected actual emissions increase of at least 50 percent of the amount that is a “significant emissions increa se,” as defined under subrule 33.3(1) (without reference to the amount that is a significant net emissions increase), for the regulated NSR pollutant; or
2. A projected actual emissions increase that, when added to the amount of emissions excluded under su brule 33.3(1), paragraph “3” of the definition of “projected21

actual emissions,” equals at least 50 percent of the amount that is a “significant emissions increase,” as defined under subrule 33.3(1) (without reference to the amount that is a significant net emissions increase), for the regulated NSR pollutant. For a project for which a reasonable possibility occurs only within the meaning of this numbered paragraph, and not also within the meaning of numbered paragraph “1” of this subparagraph (subparagraph (8)), then the provisions of subparagraphs (3) through (7) do not apply to the project.

g. The owner or operator of the source shall make the information required to be documented and maintained pursuant to paragraph “f” available for review upon request for inspection by the department or the general public pursuant to the requirements for Title V operating permits contained in 567

— subrule 22.107(6).

I TEM 7. Amend subrule 33.3(20) as follows: 33.3(20) Conditions for permit issuance. Except as explained be low, a permit may not be issued to any new “major stationary source” or “major modification” as defined in subrule 33.3(1) that would locate in any area designated as attainment or unclassifiable for any national ambient air quality standard pursuant to Se ction 107 of the Act, when the source or modification would cause or contribute to a violation of any national ambient air quality standard. A major station ary source or major modification will be considered to cause or contribute to a violation of a national ambient air quality standard when such source or modification would, at a minimum, exceed the following significance levels at any locality that does no t or would not meet the applicable national standard:

Significant Impact Levels (SILs)

Averaging Time22 Annual 24 hrs. 8 hrs. 3 hrs. 1 hr. Pollutant ( μg/m 3 ) (μg/m 3 ) (μg/m 3 ) (μg/m 3 ) (μg/m 3 ) SO 2 1.0 5

——— 25

——— PM 10 1.0 5

——— ——— ——— PM 2.5 0.3 1.2

——— ——— ——— NO 2 1.0

——— ——— ——— ——— CO

——— ——— 500

——— 2000 A permit may be granted to a major stationary source or major modification as identified abov e if the major stationary source or major modification reduces the impact of its emissions upon air quality by obtaining sufficient emissions reductions to compensate for its adverse ambient air impact where the major stationary source or major modificatio n would otherwise contribute to a violation of any national ambient air quality standard. This subrule shall not apply to a major stationary source or major modification with respect to a particular pollutant if the owner or operator demonstrates that the source is located in an area designated under Section 107 of the Act as nonattainment for that pollutant.

I TEM 8. Adopt the following new subrule 33.3(22): 33.3(22) Permit rescission. Any permit issued under 40 CFR 52.21 or this chapter or any permit issue d under rule 567

— 22.4(455B) shall remain in effect unless and until it is rescinded. The department will consider requests for rescission that meet the conditions specified under paragraphs “a” and “b” of this subrule. If the department rescinds a permit o r a condition in a permit issued under 40 CFR 52.21, this chapter, or rule 567

— 22.4(455B), the public shall be given adequate notice of the proposed rescission. Publication of an announcement of rescission in a newspaper of general circulation in the affec ted region 60 days prior to the proposed date for rescission shall be considered23

adequate notice.

a. The department may rescind a permit or a portion of a permit upon request from an owner or operator of a stationary source who holds a permit for a source or modification that was issued under 40 CFR 52.21 as in effect on July 30, 1987, or earlier, provided the application also meets the provisions in paragraph “b” of this subrule. b. If the application for rescission meets the provisions in paragraph “a” of this subrule, the department may rescind a permit if the owner or operator shows that the PSD provisions under 40 CFR 52.21 would not apply to the source or modification.PUBLIC PARTICIPATION RESPONSIVENESS SUMMA RY FOR 567 IOWA ADMINISTRAT IVE CODE CHAPTER 33 “SPECIAL REGULATIONS AND CONS TRUCTION PERMIT RE QU IREMENTS FOR MAJOR S TATIONARY SOURCES

– PREVENTION OF SIGNIFICANT DETERIOR ATION (PSD) OF AIR Q UALITY” 

### Introduction The purpose of the amendments is to adopt changes to the federal regulations for Prevention of Significant Deterioration (PSD) into Iowa’s administrative rules for air quality. The U.S. Environmental Protection Agency (EPA) finalized amendments to the PSD regulations over a three

- year period to address the revised national ambient air quality standards (NAAQS) for final particulate matter that is less than or equal to 2.5 micrometers in diameter (PM2.5). Through this rule making, the Department is also pr oviding a mechanism to allow industry to request rescission of a PSD permit. The amendment matches the federal regulations and will be a benefit to facilities that meet the qualifications for rescission of a PSD permit. Additionally, the Department is also making amendments to clarify under what circumstances facilities are required to keeps records and types of records that must be kept. The proposed amendment matches the federal regulations and will be a benefit to facilities that must meet record

- keeping requirements. Notice of Intended Action was published in the Iowa Administrative Bulletin (IAB) on April 18, 2012, as ARC 0097C . A public hearing was held on May 18, 2012 . The Department did not receive any comments at the public hearing. The Department received one written comment letter before the close of the public comment period on May 18, 2012

. 

### Public Comment Submitted by e

- mail and U.S. Mail from Joshua A. Tapp, Branch Chief, EPA Region 7, 901 North 5 th Street, Kansas City, Kansas, 66101 : EPA submitted four comments in a letter dated May 18, 2012. The comments are summarized separately below, followed by the Department’s response and recommended action. 

### Comment 1 EPA commented on the proposed amendments to 33.3(1), the definition of “regulate d NSR pollutant” that add PM2.5 and that identify nitrogen dioxides (NOx) as a presumptive precursor for PM2.5 and that exclude volatile organic compounds (VOC) as a presumptive precursor. EPA pointed out that they retain joint authority along with the Iow a Department of Natural Resources (IDNR) to make a determination on whether NOx or VOC are precursors for PM2.5 in a given area of the state. EPA recommended that IDNR adopt the federal rule language verbatim. 

### Department Response The Department agrees th at EPA has dual authority with the Department to decide if NOx or VOC are a precursor for PM2.5 in a given area. The Department will revise the amendment to match the federal language. The Department is not planning to adopt the federal language2 verbatim b ecause the terms “the State” and “the Administrator” have specific meaning in Iowa and for Iowa’s PSD program. 

### Recommended Action Revise the proposed amendment for subrule 33.3(1), definition of “regulated NSR pollutant” to the following (text recommended for inclusion in the final rules is underlined): “Regulated NSR pollutant” means the following: 1... (c) Nitrogen oxides are presumed to be precursors to PM2.5 in all attainment and unclassifiable areas, unless the department demonstrates to EPA’s satisfact ion or EPA demonstrates that emissions of nitrogen oxides from sources in a specific area are not a significant contributor to the area’s ambient PM2.5 concentrations; (d) Volatile organic compounds are presumed not to be precursors to PM2.5 in any attainm ent and unclassifiable areas, unless the department demonstrates to EPA’s satisfaction or EPA demonstrates that emissions of volatile organic compounds from sources in a specific area are a significant contributor to that area’s PM2.5 concentrations... 

### Comm ent 2 EPA commented on additional amendments to subrule 33.3(1), the definition of “regulated NSR pollutant.” The Department is proposing to adopt new federal language for this definition verbatim into state administrative rules. EPA stated that some of th is rule text, although identical to the federal regulation, is outdated and does not apply to Iowa’s PSD program. Iowa’s PSD program, as approved by EPA into Iowa’s State Implementation Plan (SIP) has long held that condensables are always considered when accounting for all forms of particulate matter (PM). Rather than adopting obsolete dates and creating uncertainty about previously issued permits, EPA recommended that Iowa adopt only the portion of the definition that is effective at this time as follows: “Particulate matter (PM) emissions, PM2.5, and PM10 emissions shall include gaseous emissions from a source or activity which condense to form particulate matter at ambient temperatures.” In the alternative, EPA recommended that the Department affirm in its response to comments that all PSD permits issued before 2011 properly considered condensable emissions when determining applicability and setting Best Available Control Technology (BACT limits), and that such decisions are unaffected by this rulemakin g. EPA also requested that the Department affirm that it does not intend to retroactively change any PSD permits to exclude condensables for this timeframe. EPA does not support retroactively changing PSD permits. 

### Department Response The Department agrees with EPA that the dates in the federal PSD language are now outdated, and do not apply to Iowa’s SIP

- approved PSD program. The Department agrees that this could create confusion to the regulated public and other interested stakeholders. In response, the D epartment will revise the amendment to include only the portion of the amendment that is effective at this time and applicable to Iowa’s PSD program.3 Additionally, the Department is affirming in this Public Participation Responsiveness Summary that the De partment properly considered condensable emissions before 2011, and the Department does not intend to retroactively change emission limits in PSD permits issued during this timeframe. 

### Recommended Action Revise the amendments to subrule 33.3(1), definition of “regulated NSR pollutant” to include only the provisions currently in effect and applicable to Iowa’s PSD program, as follows (text recommended for removal in the final rules is struck): 6. Particulate matter (PM) emissions, PM2.5, and PM10 emissions shall include gaseous emissions from a source or activity which condense to form particulate matter at ambient temperatures. On or after January 1, 2011, such condensable particulate matter shall be accounted for in applicability determinations in establis hing emissions limitations for PM, PM 2.5 and PM 10 in PSD permits. Compliance with emissions limitations for PM, PM 2.5 and PM 10 issued prior to January 1, 2011, shall not be based on condensable particulate matter unless required by the terms or conditions of the permit or Iowa’s state implementation plan (SIP). Applicability determinations made prior to January 1, 2011, without accounting for condensable particulate matter shall not be considered in violation of this requirement unless the Iowa SIP required condensable particulate matter to be included. 

### Comment 3 EPA commented that it had recently proposed revisions to the definition of “regulated NSR pollutant” to exclude condensable emissions when accounting for coarse, filterable PM. EPA stated these rul e changes if finalized, will raise questions about whether to include or exclude condensables for coarse, filterable particulate. EPA commented that if the Department decides to proceed with adoption of the federal changes, it could result in a relaxation of the PSD and major source nonattainment permitting rules from the rules in the EPA

- approved SIP. This would trigger the need for further analysis by the Department. EPA states that it will provide further guidance if it finalizes the proposed rule change

. 

### Department Response The Department will confer with EPA at such time as EPA finalizes the rule change to exclude condensable emissions when accounting for coarse, filterable PM. 

### Recommended Action No action recommended at this time 

### Comment 4 EPA state d that it is providing separate comments on a concurrently proposed rulemaking to rescind the previously SIP

- approved Compliance Sampling Manual. For that proposed rulemaking, EPA commented that the Department’s changes should not apply retroactively to pe rmits.4 

### Department Response These comments are simply summarizing EPA’s comments on a separate Department rulemaking. The Department will respond to EPA’s comments on that rulemaking at such time as the Department prepares a Public Participation Responsive ness Summary for the final rules. 

### Recommended Action No action recommended at this time

### Iowa Department of Natural Resources Environmental Protection Commission

ITEM INFORMATION

TOPIC Proposed Rule : Chapters 20, 22 , 25 and 33: Air Quality Program Rules

–

Prevention of Significant Deterioration (PSD) for Fine P articulate Matter

T he atta ched Notice of Intended A ction to amend Chapter 20 "Scope of Title

– Definitions

Forms

- Rules of Practice," " Chapter 22 " Controlling Pollution, " Chapter 25 " Measurement of Emissions ," and Chapter 33 ― Special Construction Permit Requirements for Major Statio nary Sources in Areas Designated Attainment or U nclassified (PSD) ‖ of the 567 Iowa Administrative Code is being presented to the Commission for information

. The purpose of the proposed rule changes is to adopt changes to the federal regulations for Prev ention of Significant Deterioration (PSD) into state air quality rules. The U.S. Environmental Protection Agency ( EPA ) has finalized amendments to the PSD regulations over the past two and a half years to address the new national ambient air quality standa rds (NAAQS) for fine p articulate matter that is less than or equal to 2.5 micro meters in diameter (PM2.5) . EPA issued the final component necessary for PM2.5 implementation in the PSD program on December 21, 2010. In addition, the Department also is adop ting provisions to allow for rescission of PSD permits. R escission provisions were included in the Iowa PSD rules for many years, but were inadvertently excluded when the Department adopted significant PSD amendments in 2006 to address EPA’s N ew S ource R ev iew (NSR) Reform regulations. 

### Background (PSD Program and PM2.5 Implementation) To ensure that Iowan’s have clean air to breath, the Department is required by federal and state law to develop state implementation plans that manage outdoor air resources s o that existing, new, and modifie d sources of air pollution do not cause or contribute to violati ons of the NAAQS

. Community, business and industry, agriculture, and transportation activities all contribute to air pollution in the atmosphere. A ppropriate plan s and programs to address these contributions are the building blocks necessary to assure th at the air Iowans breathe meets health based air quality standards. The first building blo ck is the federal PSD program that establishes require ments for very l arge sources of air pollution

. The PSD program is a component of NSR that includes procedures to ensure that air quality standards are maintained. The Department has had an EPA

- approved state PSD program since2

1987. In general, the PSD program requires t hat an affected facility obtain a PSD permit specifying how the facility will control emissions. The permit requires the facility to apply Best Available Control Technology (BACT), which is determined on a case

- by

- case basis taking into account, among othe r factors, the cost and effectiveness of the control. Ambient air impact analyses are conducted to determine whether the proposed emission limits, controls, and operating conditions will be sufficient to prevent violations of the NAAQS and unacceptable lev els of air quality deterioration, if the facility is constructed or modified as planned. The PM2.5 NAAQS establishes a limit on the acceptable exposure and public health impacts of PM2.5 . PM2.5 can easily by

- pass most of the body’s defense mechanisms and become lodged deep in the lungs, where the particles can cause coughing, or difficulty breathing, aggravated asthma; development of chronic bronchitis; nonfatal heart attacks; and premature death in people with heart or lung disease.
EPA created a NAAQS i n 1997 for this pollutant in order to better protect the public from the adverse impacts of PM2.5 on human health. EPA strengthened the PM2.5 NAAQS in 2006 based on reviews of the latest public health information and scientific data, reducing the acceptabl e level of PM2.5 that humans can be exposed to from 65 micrograms per cubic meter of air (ug/m 3 ) down to 35 ug/m 3

. An essential component of EPA’s revising the NAAQS for PM2.5 is implementation rules for the PSD program

. EPA finalize d the first of its PSD amendments for PM2.5 implementation in May 2008, but did not finalize the last of the necessary updates until December 21, 2010. Now that EPA has completed the PSD amendments for PM2.5 , the Department is proceeding with proposing necessary changes to stat e air quality rules. 

### Summary of rule changes This rulemaking make s amendments to Iowa’s rules to implement changes to the federal PM2.5 regulations that EPA finalized in a phased approach over the last three years. This rulemaking addresses the following EPA actions : May 16, 2008

– EPA p ublished final rules setting PSD significant emissions rates for PM2.5 and addressed PM2.5 precursors. October 20, 2010

– EPA p ublished final rules setting PSD increments, significant impact levels (SIL s ), and significant monitoring concentrations (SM Cs ) for PM2.5; and December 21, 2010

– EPA published federal rules establishing EPA reference stack testing methods for PM2.5. The specific items included in the adopted rules are briefly summarized below. The specific amendm ents are included in the attached Notice of Intended Action. Item 1 amends Chapter 20 to adopt EPA’s revisions to stack test methods to establish procedures for measuring PM2.5.3

Item 2 amends Chapter 22, the Title V program rules, to adopt EPA’s revision s to stack test methods to establish procedures for measuring PM2.5

. Item 3 amends the stack test methods and procedures in Chapter 25 to include EPA’ s new procedures for PM2.5.
Item 3 also adopt s by reference revisions the Department’s ―Compliance Sampl ing Manual‖ to reflect the new PM2.5 testing methods and to establish alternative testing procedures. The proposed changes to the sampling manual would allow facilities to use the new PM2.5 testing methods or to alternatively complete one test for particul ate matter ( PM ) using an updated Iowa procedure t o demonstrate compliance with multiple limits for PM, particulate matter that is less than equal to 10 micro meters in diameter (PM10 ) , and PM2.5. The Iowa procedure has been used in the past with facilities conducting a PM test to show compliance with both the PM and PM10 limits in a permit. With the EPA amendments, the Department no longer considers the current Iowa procedure to be equivalent, and the Department is revising the Compliance Sampling Manual to address this. The proposed revisions to the manual will be provided at the Commission meeting

. The public may provide comments on the revisions to the Compliance Sampling Manual during the public comment period for this rulemaking.
Item 4 amends the PSD rules in Chapter 33 to add a new definition for PM2.5. The definition is based on the current definition of PM10 in Chapter 20, and also matches the federal definition in 40 Code of Federal Regulations (CFR) Part 58, Subpart A.
Item 5 amends several PSD definitions in Chapter 3 3 to match the changes EPA made in 40 CFR 52.21 to implement the PM2.5 NAAQS. The definitions revised include ―baseline area,‖ ―baseline date,‖ ―enforceable permit condition,‖ ―federally enforceable,‖ ―regulated NSR pollutant,‖ and ―significant.‖ The proposed revisions match the federal amendments, except that the Department is not proposing to adopt federal language that is explanatory to states. Item 6 amends Chapter 33 to adopt by reference EPA’s revisions to the ambient air incr ements to include thresholds for PM2.5.
Item 7 amends Chapter 33 to adopt by reference EPA’s amendments to the PSD exemptions to incorporate PM2.5.
Item 8 amends Chapter 33 to adopt by reference EPA’s revisions to the source impact analysis requirements to include PM2.5.
Item 9 amends Chapter 33 to adopt by reference EP A ’s revisions to the requirements for so urces impacting federal Class I areas to include PM2.5.
Item 10 amends Chapter 33 to revise the provisions for the conditions for permit issuance t o match EPA amendments that establish the PSD significance levels for PM2.5

.4

Item 11 amends Chapter 33 to add new provisions for rescinding a PSD permit. The Department is proposing this amendment because these provisions were inadvertently excluded when the Department finalized changes to the PSD rules in 2006. The proposed amendments are similar to EPA’s regulations in 40 CFR 52.21(w) , except that the revisions are tailored to the Department’s long

- standing rules for permit revocations

. The Department p lans to bring this Notice to the Commission for decision at the Commission's March meeting.

Christine Paulson Environmental Specialist Senior Program Development Section, Air Quality Bureau Memo date: January 24, 20111 ENVIRONMENTAL PROTECTION COMMISSI ON [567]

Notice of Intended Action
Pursuant to the authority of Iowa Code section 455B.133, the Environmental Protection Commission hereby gives Notice of Intended Action to amend Chapter 20 "Scope of Title

– Definitions

- Forms

- Rules of Practice," Chapter 2 2, ―Controlling Pollution,‖ Chapter 25 , "Measurement of Emissions,‖ and Chapter 33 ― Special Construction Permit Requirements for Major Stationary Sources in Areas Designated Attainment or Unclassified (PSD)‖ Iowa Administrative Code. The purpose of the pro posed rule changes is to adopt changes to the federal regulations for Prevention of Significant Deterioration (PSD) into state air quality rules. The U.S. Environmental Protection Agency (EPA) has finalized amendments to the PSD regulations over the past t wo and a half years to address the new national ambient air quality standards (NAAQS) for fine particulate matter that is less than or equal to 2.5 micro meters in diameter (PM2.5). EPA issued the final component necessary for PM2.5 implementation in the PS D program on December 21, 2010. In addition, the Department also is adopting provisions to allow for rescission of PSD permits. Rescission provisions were included in the Iowa PSD rules for many years, but were inadvertently excluded when the Department a dopted significant PSD amendments in 2006 to address EPA’s N ew S ource R eview (NSR) Reform regulations. To ensure that Iowan’s have clean air to breath, the Department is required by federal and state law to develop state implementation plans that manage o utdoor air resources so that2

existing, new, and modified sources of air pollution do not cause or contribute to violations of the NAAQS. Community, business and industry, agriculture, and transportation activities all contribute to air pollution in the atm osphere. Appropriate plans and programs to address these contributions are the building blocks necessary to assure that the air Iowans breathe meets health based air quality standards. The first building block is the federal PSD program that establishes

re quirements for very large sources of air pollution. The PSD program is a component of NSR that includes procedures to ensure that air quality standards are maintained. The Department has had an EPA

- approved state PSD program since 1987. In general, the PS D program requires that an affected facility obtain a PSD permit specifying how the facility will control emissions. The permit requires the facility to apply Best Available Control Technology (BACT), which is determined on a case

- by

- case basis taking into account, among other factors, the cost and effectiveness of the control. Ambient air impact analyses are conducted to determine whether the proposed emission limits, controls, and operating conditions will be sufficient to prevent violations of the NAAQS and unacceptable levels of air quality deterioration, if the facility is constructed or modified as planned. The PM2.5 NAAQS establishes a limit on the acceptable exposure and public health impacts of PM2.5 . PM2.5 can easily by

- pass most of the body’s defe nse mechanisms and become lodged deep in the lungs, where the particles can cause coughing, or difficulty breathing, aggravated asthma; development of chronic bronchitis; nonfatal heart attacks; and premature death in people with heart or lung disease.
EPA created a NAAQS in 1997 for this pollutant in order to better protect the public from the adverse impacts of PM2.5 on human health. EPA strengthened the PM2.5 NAAQS in 20063

based on reviews of the latest public health information and scientific data, redu cing the acceptable level of PM2.5 that humans can be exposed to from 65 micrograms per cubic meter of air (ug/m

3 ) down to 35 ug/m 3

. An essential component of EPA’s revising the NAAQS for PM2.5 is implementation rules for the PSD program. EPA finalized the first of its PSD amendments for PM2.5 implementation in May 2008, but did not finalize the last of the necessary updates until December 21, 2010. Now that EPA has completed the PSD amendments for PM2.5, the Department is proceeding with proposing necessar y changes to state air quality rules. This rulemaking make amendments to Iowa’s rules to implement changes to the federal PM2.5 regulations that EPA finalized in a phased approach over the last three years. This rulemaking addresses the following EPA acti ons: May 16, 2008

– EPA published final rules setting PSD significant emissions rates for
PM2.5 and addressed PM2.5 precursors. October 20, 2010

– EPA published final rules setting PSD increments, significant impact levels (SIL s ), and significant monitorin g concentrations (SM Cs ) for PM2.5; and December 21, 2010

– EPA published federal rules establishing EPA reference stack testing
methods for PM2.5.
Item 1 amends rule 567

— 20.2 (455B) , the definition of "EPA reference method," to adopt EPA’s revisions to sta ck test methods to establish procedures for measuring PM2.5.
Item 2 amends 567

— 22.100(455B) , the definition of ―EPA reference method,‖ in the Title V progr am rules to adopt EPA’s revisions to stack test methods to establish procedures for measuring PM2.5

.4

Item 3 amends subrule 25.1(9), the st ack test methods and procedures, to include EPA’s new procedures for PM2.5. Item 3 also adopts by reference revisions the Department’s ―Compliance Sampling Manual‖ to reflect the new PM2.5 testing methods and to establi sh alternative testing procedures. The proposed changes to the sampling manual would allow facilities to use the new PM2.5 testing methods or to alternatively complete one test for particulate matter (PM) using an updated Iowa procedure to demonstrate comp liance with multiple limits for PM, particulate matter that is less than equal to 10 micrometers in diameter (PM10), and PM2.5. The Iowa procedure has been used in the past with facilities conducting a PM test to show compliance with both the PM and PM10 l imits in a permit. With the EPA amendments, the Department no longer considers the current Iowa procedure to be equivalent, and the Department is revising the Compliance Sampling Manual to address this. The proposed
revisions to the manual are available on the Department’s website at http://www.iowadnr.gov/air/input/input.html

. The public may provide comments on the revisions to the Compliance Sampling Manual during the public comment period for th is rulemaking.
Item 4 amends subrule 33.1(2) to add a new definition for “ PM2.5. ” The definition is based on the current definition of PM10 in Chapter 20, and also matches the federal definition in 40 Code of Federal Regulations (CFR) Part 58, Subpart A.
Item 5 amends subrule 33.1(2) to revise the definitions of “baseline area,” “b aseline
date , ” “e nforceable permit condition,” “f ederally enforceable” “regulated NSR pollutant,” and
“s ignificant” to match the changes EPA made in 40 CFR 52.21 to implement the PM2.5 NAAQS. The proposed revisions match the federal amendments, except that the Department is not proposing to adopt federal language that is explanatory to states.5

Item 6 amends subrule 33.3(3) t o adopt by reference EPA’s revisions to the ambient air
i ncrements to include thresholds for PM2.5.
Item 7 amends 33.3(9) to adopt by reference EPA’s amendments to the PSD exemptions to incorporate PM2.5.
Item 8 amends 33.3(11) to adopt by reference EPA’s revisions to the source impact analysis requirements to i nclude PM2.5.
Item 9 amends 33.3(16) to adopt by reference EPA’s revisions to the requirements for sources impacting federal Class I areas to include PM2.5.
Item 10 amends 33.3(20) to revise the provisions for the conditions for permit issuance to
match EP A amendments that establish the PSD significance levels for PM2.5.
Item 11 adds new subrule 33.3(22) to establish provisions for rescinding a PSD permit. The Department is proposing this amendment because these provisions were inadvertently
excluded when t he Department finalized changes to the PSD rules in 2006. The proposed amendments are similar to EPA’s regulations in 40 CFR 52.21(w), except that the revisions are tailored to the Department’s long

- standing rules for permit revocations. Any person may mak e written suggestions or comments on the proposed amendments on
or before [DATE TBD] . Written comments should be directed to Christine Paulson, Department of Natural Resources, Air Quality Bureau, 7900 Hickman Road, Suite 1, Windsor Heights, Iowa,
50324 , f ax (515) 242

- 5094, or by E

- mail to christine.paulson@dnr.iowa.gov

. A public hearing will be held on [DATE TBD] , at 1:00 PM in the conference rooms at the department’s Air Quality Bureau office located a t 7900 Hickman Road, Windsor Heights , Iowa.
All comments must be received no later than [DATE TBD]

.6

Any person who intends to attend the public hearing and has special requirements such as those related to hearing or mobility impairments should contact Chr istine Paulson at (515) 242

- 5154 , or by E

- mail at christine.paulson@dnr.iowa.gov to advise of any specific needs. These amendments are intended to implement Iowa Code section 455B.133.

The following a mendments are proposed.

I TEM 1. Amend rule 567

— 20.2 (455B) , the definition of "EPA reference method," as follows: “EPA reference method” means any method of sampling and analyzing for an air pollutant as described in 40 CFR 51, Appendix M (as amended thro ugh June 16, 1997 December 21, 2010 ); 40 CFR 52, Appendices D and E (as amended through February 6, 1975); 40 CFR 60, Appendices A (as amended through September 28, 2007), B (as amended through September 28, 2007), C (as amended through December 16, 1975), and F (as amended through January 12, 2004); 40 CFR 61, Appendix B (as amended through October 17, 2000); 40 CFR 63, Appendix A (as amended through October 17, 2000); and 40 CFR 75, Appendices A (as amended through January 24, 2008), B (as amended through January 24, 2008), F (as amended through January 24, 2008, and corrected on February 13, 2008) and K (as amended through January 24, 2008).

I TEM 2. Amend rule 567

— 22.100(455B) , the definition of ―EPA reference method,‖ as follows: “EPA reference metho d” means any method of sampling and analyzing for an air pollutant as described in 40 CFR 51, Appendix M (as amended through June 16, 1997 December7

21, 2010 ); 40 CFR 52, Appendices D (as amended through February 6, 1975) and E (as amended through February 6, 1975); 40 CFR 60, Appendices A (as amended through September 28, 2007), B (as amended through September 28, 2007), C (as amended through December 16, 1975), and F (as amended through January 12, 2004); 40 CFR 61, Appendix B (as amended through October 1 7, 2000); 40 CFR 63, Appendix A (as amended through October 17, 2000); and 40 CFR 75, Appendices A (as amended through January 24, 2008), B (as amended through January 24, 2008), F (as amended through January 24, 2008, and corrected on February 13, 2008) a nd K (as amended through January 24, 2008).

I TEM 3 . Amend subrule 25.1(9) as follows: 25.1(9) Methods and procedures. Stack sampling and associated analytical methods used to evaluate compliance with emission limitations of 567

— Chapter 23 or a permit cond ition are those specified in the ―Compliance Sampling Manual‖ 1 adopted by the commission on May 19, 1977, as revised through January 30, 2003 [insert revision date that is the effective date of adopted amendments] . Sampling methods, analytical determinatio ns, minimum performance specifications and quality assurance procedures for performance evaluations of continuous monitoring systems are those found in Appendix M (as amended through December 21, 2010) of 40 CFR Part 51, Appendices A (as amended through Se ptember 28, 2007), B (as amended through September 28, 2007) and F (as amended through January 12, 2004) of 40 CFR Part 60, and Appendices A (as amended through January 24, 2008), B (as amended through January 24, 2008), F (as amended through February 13, 2008) and K (as amended through January 24, 2008) of 40 CFR Part 75.8

I TEM 4 . Amend subrule 33.1(2) to add a new definition for ―PM2.5‖ as follows:

“PM 2.5 ” means particulate matter with an aerodynamic diameter less than or equal to a
nominal 2.5 micrometer s as measured by an EPA

- approved reference method.

I TEM 5

. Amend subrule 33.1(2) to revise the definitions of “ baseline area,” “ b aseline
date , ” “e nforceable permit condition,” “f ederally enforceable” “regulated NSR pollutant,” and
“s ignificant” as follow s :
“Baseline area” means:
1. Any intrastate area (and every part thereof) designated as attainment or unclassifiable under Section 107(d)(1)(D) or (E) 107(d)(1)(A)(ii) or (iii) of the Act in which the major source or major modification establishing the m inor source baseline date would construct or would have an air quality impact equal to or greater than 1 ug/m 3 (annual average) of the pollutant for which the minor source baseline date is established for the pollutant for which the baseline dates is estab lished, as follows: equal to or greater than 1 ug/ m 3 (annual average) for
SO 2 , NO 2 or PM 10 ; or equal or greater than 0.3 ug/ m 3 (annual average) for PM 2.5 . 2. Area redesignations under 107(d)(1)(D) or (E) 107(d)(1)(A)(ii) or (iii) of the Act cannot inter sect or be smaller than the area of impact of any major stationary source or major modification which establishes a minor source baseline date or is subject to regulations specified in this rule, in 40 CFR 52.21 (PSD requirements), or in department rules a pproved by EPA under 40 CFR Part 51, Subpart I, and would be constructed in the same state as the state proposing the redesignation.9

3. Any baseline area established originally for the total suspended particulate increments shall remain in effect and shal l apply for purposes of determining the amount of available PM 10 increments, except that such baseline area shall not remain in effect if the permitting authority rescinds the corresponding minor source baseline date in accordance with the definition of ―b aseline date‖ specified in this subrule.

“Baseline date” means:
1. Either ―major source baseline date‖ or ―minor source baseline date‖ as follows: (a) The ―major source baseline date‖ means, in the case of particulate matter PM 10 and sulfur dioxide, Jan uary 6, 1975, and in the case of nitrogen dioxide, February 8, 1988 , and in the case of PM 2.5 , October 20, 2010

. (b) The ―minor source baseline date‖ means the earliest date after the trigger date on which a major stationary source or a major modification subject to 40 CFR 52.21 as amended through November 29, 2005, October 20, 2010, or subject to this rule (PSD program requirements), or subject to a department rule approved by EPA under 40 CFR Part 51, Subpart I, submits a complete application under the r elevant regulations. The trigger date for particulate

matter PM 10 and sulfur dioxide is August 7, 1977. For nitrogen dioxide, the trigger date is February 8, 1988. For PM 2.5 , the trigger date is October 20, 2010.

2. The ―baseline date‖ is established for each pollutant for which increments or other equivalent measures have been established if: (a) The area in which the proposed source or modification would construct is designated as attainment or unclassifiable under Section 107(d)(1)(D) or (E) 107(d)(1)( A)(ii) or10

(iii) of the Act for the pollutant on the date of its complete application under 40 CFR 52.21 as amended through November 29, 2005, October 20, 2010, or under regulations specified in this rule (PSD program requirements); and (b) In the case of a major stationary source, the pollutant would be emitted in significant amounts, or in the case of a major modification, there would be a significant net emissions increase of the pollutant. Any minor source baseline date established originally for the to tal suspended particulate increments shall remain in effect and shall apply for purposes of determining the amount of available PM 10 increments, except that the reviewing authority may rescind any such minor source baseline date where it can be shown, to t he satisfaction of the reviewing authority, that the emissions increase from the major stationary source, or the net emissions increase from the major modification, responsible for triggering that date did not result in a significant amount of
PM 10 emissio ns.

“Enforceable permit condition,” for the purpose of this chapter, means any of the following limitations and conditions: requirements development pursuant to new source performance standards, prevention of significant deterioration standards, emissions standards for hazardous air pollutants, requirements within the SIP, and any permit requirements established pursuant to this chapter, any permit requirements established pursuant to 40 CFR 52.21 or Part 51, Subpart I, as amended through November 29, 2005 , October 20, 2010, or under conditional, construction or Title V operating permit rules.11

“Federally enforceable” means all limitations and conditions which are enforceable by the Administrator and the department, including those federal requirements not yet adopted by the state, developed pursuant to 40 CFR Parts 60, 61 and 63; requirements within 567

— subrules 23.1(2) through 23.1(5); requirements within the SIP; any permit requirements established pursuant to 40 CFR 52.21 or under regulations approved pu rsuant to 40 CFR Part 51, Subpart I, as amended through November 29, 2005, October 20, 2010, including operating permits issued
under an EPA

- approved program, that are incorporated into the SIP and expressly require adherence to any permit issued under suc h program.

“Regulated NSR pollutant” means the following:

1. Any pollutant for which a national ambient air quality standard has been promulgated and any constituents or precursors for such pollutants identified by the Administrator (e.g., volatile organ ic compounds and NO x are precursors for ozone) ; (a) Volatile organic compounds and nitrogen oxides are precursors to ozone in all attainment and unclassifiable areas. (b) Sulfur dioxide is a precursor to PM 2.5 in all attainment and unclassifiable areas. (c ) Nitrogen oxides are presumed to be precursors to PM 2.5 in all attainment and unclassifiable areas unless the applicant demonstrates to the d epartment’s satisfaction that emissions of nitrogen oxides from sources in a specific area are not a significant c ontributor to the area’s ambient PM 2.5 concentrations

. 2. Any pollutant that is subject to any standard promulgated under Section 111 of the Act;12

3. Any Class I or Class II substance subject to a standard promulgated under or established by Title VI of t he Act; or

4. Any pollutant that otherwise is subject to regulation under the Act as defined in 33.3(1), definition of ―subject to regulation.‖

5. Notwithstanding paragraphs ―1‖ through ―4,‖ the definition of ―regulated NSR pollutant‖ shall not include a ny or all hazardous air pollutants that are either listed in Section 112 of the Act or added to the list pursuant to Section 112(b)(2) of the Act and that have not been delisted pursuant to Section 112(b)(3) of the Act, unless the listed hazardous air poll utant is also regulated as a constituent or precursor of a general pollutant listed under Section 108 of the
Act.

“Significant” means:

1. In reference to a net emissions increase or the potential of a source to emit any of the following pollutants, a rat e of emissions that would equal or exceed any of the following rates:
Pollutant and Emissions Rate

● Carbon monoxide: 100 tons per year (tpy)

● Nitrogen oxides: 40 tpy

● Sulfur dioxide: 40 tpy

● Particulate matter: 25 tpy of particulate matter emission s or 15 tpy of PM 10 emissions

● PM 10 : 15 tpy13 ● PM 2.5 : 10 tpy of PM 2.5 emissions; 40 tpy of sulfur dioxide emissions; 40 tpy of nitrogen oxide emissions

● Ozone: 40 tpy of volatile organic compounds or NO x

● Lead: 0.6 tpy

● Fluorides: 3 tpy

● Sulfuric acid mist: 7 tpy

● Hydrogen sulfide (H 2 S): 10 tpy

● Total reduced sulfur (including H 2 S): 10 tpy

● Reduced sulfur compounds (including H 2 S): 10 tpy

● Municipal waste combustor organics (measured as total tetra

- through

octa

- chlorinated dibenzo

- p - di oxins and dibenzofurans): 3.2 × 10 - 6 megagrams per year (3.5 × 10 - 6 tons per year)

● Municipal waste combustor metals (measured as particulate matter): 14 megagrams per year (15 tons per year)

● Municipal waste combustor acid gases (measured as sulfur di oxide and hydrogen chloride): 36 megagrams per year (40 tons per year)

● Municipal solid waste landfill emissions (measured as nonmethane organic compounds): 45 megagrams per year (50 tons per year)
2. ―Significant‖ means, for purposes of this rule and i n reference to a net emissions increase or the potential of a source to emit a regulated NSR pollutant not listed in paragraph ―1,‖ any emissions rate.

3. Notwithstanding paragraph ―1,‖ ―significant,‖ for purposes of this rule, means any emissions rate o r any net emissions increase associated with a major stationary source14

or major modification, which would construct within ten kilometers of a Class I area, and have an impact on such area equal to or greater than 1 ug/m 3 (24

- hour average).

I TEM 6

. Amen d subrule 33.3(3) as follows: 33.3(3) Ambient air increments. The provisions for ambient air increments as specified in 40 CFR 52.21(c) as amended through November 29, 2005, October 20, 2010, are adopted by reference.

I TEM 7

. Amend subrule 33.3(9) as fo llows: 33.3(9) Exemptions. The provisions for allowing exemptions from certain requirements
for PSD

- subject sources as specified in 40 CFR 52.21(i) as amended through May 1, 2007, October 20, 2010, are adopted by reference.

I TEM 8

. Amend subrule 33.3(11 ) as follows: 33.3(11) Source impact analysis. The provisions for a source impact analysis as specified in 40 CFR 52.21(k) as amended through November 29, 2005, October 20, 2010, are adopted by reference.

I TEM 9

. Amend subrule 33.3(16 ) as follows:
33.3 (16) Sources impacting federal Class I areas

— additional requirements. The provisions for sources impacting federal Class I areas as specified in 40 CFR 51.166(p) as amended through November 29, 2005, October 20, 2010, are adopted by reference. The15

followin g phrases contained in 40 CFR 51.166(p) are not adopted by reference: ―the plan may provide that,‖ ―the plan shall provide that,‖ ―the plan shall provide‖ and ―mechanism whereby.‖

I TEM 10

. Amend subrule 33.3(20) as follows: 33.3(20) Conditions for permit issuance. Except as explained below, a permit may not be issued to any new ―major stationary source‖ or ―major modification‖ as defined in subrule 33.3(1) that would locate in any area designated as attainment or unclassifiable for any national ambient
ai r quality standard pursuant to Section 107 of the Act, when the source or modification would cause or contribute to a violation of any national ambient air quality standard. A major stationary source or major modification will be considered to cause or con tribute to a violation of a national ambient air quality standard when such source or modification would, at a minimum, exceed the following significance levels at any locality that does not or would not meet the applicable
national standard: Significant Impact Levels (SIL s ) Averaging Time Annual 24 hrs. 8 hrs. 3 hrs. 1 hr. Pollutant (ug/m 3 ) (ug/m

3 ) (ug/m

3 ) (ug/m

3 ) (ug/m

3 ) SO 2 1.0 5

——— 25

——— PM 10 1.0 5

——— ——— ——— PM 2.5 0.3 1.2 NO 2 1.0

——— ——— ——— ——— CO

——— ——— 500

——— 2000

A permit may be granted to a major stationary source or major modification as identified above if the major stationary source or major modification reduces the impact of its emissions16

upon air quality by obtaining sufficient emissions reductions to compensate for its adverse ambient air impact where the major stationary source or major modification would otherwise contribute to a violation of any national ambient air quality standard. This subrule shall not apply to a major stationary source or major modification with respect to a particular pollutant if the owner or operator demonstrates that the source is located in an area designated under Section 107 of the Act as nonattainment for that pollutant.

I TEM 11

. Add new subrule 33.3( 22) as follows‖ 33.3(22) Permit rescission. Any permit issued under 567 Chapter 33 or any permit
issued under rule 567

— 22.4(455B) shall remain in effect unless and until it is rescinded . The department may rescind a permit issued under 567 Chapter 33 or rule 567

— 22.4(455B) if th e department has knowledge that a permit holder has lost legal entitlement to use the property identified in the permit, upon notice that the owner or operator no longer wishes to continue operation of the permitted equipment, or upon notice that the owner or operator of the permitted equipment no longer wishes to retain the permit for future operation. If the d epartment rescinds a permit under this rule, the public shall be given adequate notice of the rescission. Publication of an announcement of rescis sion in a newspaper of general circulation in the affected region within 60 day of the rescission shall be considered adequate notice.

_________________________________ Date

_________________________________ Roger L

. Lande , DirectorIowa Administrative Bulletin

Volume XXXV, Number 3 August 8, 2012 Pages 244

- 253

1 

### ARC 0260C ENVIRONMENTAL PROTECTION COMMISSION[567] Adopted and Filed Pursuant to the authority of Iowa Code section 455B.133, the Environmental Protection Commission hereby amends Chapter 33, “Special Regulations and Construction Permit Requirements for Ma jor Stationary Sources

— Prevention of Significant Deterioration (PSD) of Air Quality,” Iowa Administrative Code. The purpose of the amendments is to adopt changes to the federal regulations for Prevention of Significant Deterioration (PSD) into Iowa’s admin istrative rules for air quality. The U.S. Environmental Protection Agency (EPA) finalized amendments to the PSD regulations over a three

- year period to address the revised national ambient air quality standards (NAAQS) for fine particulate matter that is l ess than or equal to 2.5 micrometers in diameter (PM 2.5 ). EPA issued the final regulation necessary for PM 2.5 implementation for the PSD program on December 21, 2010. Through this rule making, the Department is also providing a mechanism to allow industry to request rescission of a PSD permit. The amendment matches federal regulations and will be a benefit to facilities that meet the qualifications for rescission of a PSD permit. Additionally, the Department is adopting an amendment to clarify under what ci rcumstances facilities are required to keep records and the types of records that must be kept. The amendment matches federal regulations and will be a benefit to facilities that must meet record

- keeping requirements. Notice of Intended Action was publishe d in the Iowa Administrative Bulletin on April 18, 2012, as ARC 0097C . A public hearing was held on May 18, 2012. The2

Department did not receive any comments at the public hearing. The Department received one written comment before the close of the public comment period on May 18, 2012. The written comment was submitted by EPA Region VII. The submitted comment and the Department’s response to the comment are summarized in the public responsiveness summary available from the Department. The Department made c hanges to the amendments in response to EPA’s comments. The changes are described in the explanation of the amendments in Item 1. To ensure that Iowans have clean air to breathe, the Department is required by federal and state law to develop state implemen tation plans that manage outdoor air resources so that existing, new, and modified sources of air pollution do not cause or contribute to violations of the NAAQS. Community, business and industry, agriculture, and transportation activities all contribute t o air pollution in the atmosphere. Appropriate plans and programs to address these contributions are the building blocks necessary to ensure that the air Iowans breathe meets health

- based air quality standards. One of these building blocks is the federal P SD program that establishes requirements for very large sources of air pollution. The PSD program is a component of New Source Review (NSR) that includes procedures to ensure that air quality standards are maintained. The NSR program was designed to allow economic growth in harmony with the preservation of existing clean air. Requirements and limits are specified in preconstruction permits to protect the public from the adverse effects which might occur if sources were allowed to operate unregulated. There are three types of preconstruction air quality permitting that comprise NSR:3

minor, major, and nonattainment NSR. Minor source preconstruction permitting is for sources that emit less than either 100 or 250 tons per year (tpy) of any one air pollutant depe nding on the facility’s source category. Major source preconstruction permitting is for sources whose plantwide emissions exceed the 100 or 250 tpy threshold for any one air pollutant. Major source preconstruction permitting entails issuance of either a PS D permit or a permit to avoid PSD applicability. Lastly, nonattainment NSR preconstruction permitting occurs within those areas of the state that are not meeting the ambient air quality standards. Iowa currently does not have any nonattainment areas for PM 2.5 . The Department has administered an EPA

- approved state PSD program since 1987. In general, the PSD program requires that an affected facility obtain a PSD permit specifying how the facility will control air emissions. The permit requires the facility t o apply best available control technology (BACT), which is determined on a case

- by

- case basis, taking into account, among other factors, the cost and effectiveness of the control. Ambient air impact analyses are conducted to determine whether the proposed emission limits, controls, and operating conditions will be sufficient to prevent violations of the NAAQS and unacceptable levels of air quality deterioration. The NAAQS for PM 2.5 establish limits on the acceptable exposure and public health impacts of PM 2 .5 . PM 2.5 can easily bypass most of the body’s defense mechanisms and become lodged deep in the lungs, where the particles can cause coughing, difficulty breathing, or aggravated asthma; development of chronic bronchitis; nonfatal heart attacks; and premat ure death in people with heart or lung disease. EPA created an NAAQS in 1997 for this pollutant in order to better protect the public from the adverse impacts of PM 2.5 on human health. EPA strengthened the PM 2.54

NAAQS in 2006 based on reviews of the latest public health information and scientific data, reducing the acceptable level of PM 2.5 to which humans can be exposed from 65 micrograms per cubic meter of air ( μg/m 3 ) to 35 μg/m 3

. An important component to establishing the revised air quality standards for
PM 2.5 is EPA’s corresponding changes to the PSD program. EPA finalized the first of its PSD amendments for PM 2.5 implementation in May 2008 but did not finaliz e the last of the necessary updates until December 21, 2010. Now that EPA has completed the PSD amendments for PM 2.5 , the Department is proceeding with proposing necessary amendments to Iowa’s air quality rules for the PSD program. This rule making amends Iowa’s air quality rules to implement changes to the
federal PM 2.5 regulations that EPA finalized in a phased approach over three years. This rule making addresses two EPA actions:

● On May 16, 2008, EPA publication of final rules setting PSD significant emissions rates for PM 2.5 and addressing PM 2.5 precursors; and

● On October 20, 2010, EPA publication of final rules setting PSD increments, significant impact levels (SILs), and sig nificant monitoring concentrations (SMCs) for PM 2.5 . On December 21, 2010, EPA published federal rules establishing EPA stack testing methods for PM 2.5 . The Department has proposed adoption by reference of these federal rules in a separate rule making publ ished under Notice of Intended Action as ARC 0087C in the April 18, 2012, Iowa Administrative Bulletin. For industry to continue to receive federally acceptable PSD permits from the State, the Department must adopt these PM 2.5 requirements into administrat ive rules. On5

September 8, 2011, EPA published a finding of failure of the State of Iowa to submit a State Implementation Plan (SIP) for the NAAQS for PM 2.5 . EPA’s finding became effective on October 11, 2011, and establishes a deadline for EPA to issue a Federal Implementation Plan for PM 2.5 if the outstanding SIP elements, including adoption of the PSD requirements in this rule making, are not completed. Failure to adopt PSD requirements for PM 2.5 may result in the loss of the State’s PSD program, which w ould cause the EPA to become the permitting authority and would significantly increase the amount of time required for a facility to obtain a PSD permit. Additionally, two amendments included in the rule making, the permit rescission and record

- keeping pro visions, provide regulatory flexibility to affected facilities. Failure to adopt these amendments would have prevented the Department from providing these benefits to industry. Item 1 amends subrule 33.3(1) to revise the definitions of “baseline area,” “ba seline date,” “enforceable permit condition,” “federally enforceable,” “regulated NSR pollutant,” and “significant” to match the changes EPA made in 40 Code of Federal Regulations (CFR) 51.166 and 52.21 to implement the PM 2.5 NAAQS. The revised definitions match the federal definitions in 40 CFR 51.166 and 52.21. The Department is also revising references to specific sections of the Clean Air Act to match corrections that EPA made to the CFR. Since the publication of the Notice of Intended Action, the Depar tment has made changes to the amendment of the definition of “regulated NSR pollutant” based on comments received from EPA Region VII. First, EPA requested in its comments that the Department make revisions to6

match the federal language to clarify that EPA has concurrent authority with the Department to make determinations for PM 2.5 precursors in areas of the state. The Department agrees that EPA has concurrent authority to make these determinations, and the Department has made the recommended change to num bered paragraph “1” of the
definition. Second, EPA commented on a portion of proposed language describing condensable particulate matter. EPA stated that, although the proposed language matched the federal amendments to the PSD regulations, the language is now obsolete and that, further, the federal provisions do not apply to Iowa’s federally approved PSD program. The Department agrees with EPA’s comments and has removed the language from numbered paragraph “6” of the definition as EPA suggested. No other c hanges from the Notice have been made. Item 2 amends subrule 33.3(3) to adopt by reference EPA’s revisions to the
ambient air increments to include thresholds for PM 2.5 . Item 3 amends subrule 33.3(9) to adopt by reference EPA’s amendments to the PSD exempt ions to incorporate PM 2.5 . Item 4 amends subrule 33.3(11) to adopt by reference EPA’s revisions to the source impact analysis requirements to include PM 2.5 . Item 5 amends subrule 33.3(16) to adopt by reference EPA’s revisions to the requirements for source s impacting federal Class I areas to include PM 2.5 . Item 6 amends subrule 33.3(18) to revise the “source obligation” provisions to match current federal PSD regulations. This amendment clarifies under what conditions source owners and operators must keep r ecords and the specific records that must be7

kept. The amendment also adds the federal definition of “reasonable possibility” for purposes of keeping records under subrule 33.3(18). This amendment will allow facilities additional record

- keeping flexibility and reduce the record

- keeping burden.
Item 7 amends subrule 33.3(20) to revise the provisions for the conditions for permit issuance to match EPA amendments that establish the PSD significance levels for
PM 2.5 . Item 8 adds new subrule 33.3(22) to establis h provisions for rescinding a PSD permit. Currently, there is no mechanism in rules for the Department to rescind a PSD permit, even if PSD program requirements no longer apply to a facility. This provision was inadvertently excluded when the Department ad opted amendments to PSD rules in 2006. This adopted amendment matches EPA’s regulations in 40 CFR 52.21(w). The complete Jobs Impact Statement prepared by the Department is available from the Department upon request. The following is a summary of the Jobs Impact Statement. After analysis and review of this rule making, there could be an impact on jobs. However, these amendments are mandated by EPA federal regulations, and the State of Iowa is not requiring additional regulations. The Department will continu e to work with stakeholders to minimize any adverse impact on jobs and to maximize any positive impact on jobs. One of Congress’s goals for PSD as set forth in the Clean Air Act was to allow economic growth in harmony with the preservation of existing clea n air. Requirements and limits are specified in preconstruction permits to protect the public from adverse effects that might occur if sources were allowed to operate unregulated. The requirements8

in PSD permits help prevent areas of the state from becomin g nonattainment areas. Major sources locating in or undergoing modifications in nonattainment areas must generally meet emissions requirements stricter than those called for under the PSD program. Communities in nonattainment areas attempting to meet the C lean Air Act requirements can face significant challenges that make it very difficult or impossible for businesses to locate or expand in that area. Currently, Iowa does not have any nonattainment areas for
PM 2.5 , in part because of the success of the PSD program in preventing air quality from deteriorating. Companies may locate or expand in any area of the state without the significant barriers that would be imposed by PM 2.5 nonattainment, and this may create a positive jobs impact. The Department estimate d emissions control costs required for the PSD program’s BACT provisions. These estimates are based on three companies’ tax filings from 2009, 2010, and 2011. These costs ranged from $30,000 to $10 million and included all costs associated with equipment a nd installation. However, because BACT is also required for total particulate matter (PM) emissions and course particulate matter (PM 10 ) emissions, only one

- half to one

- third of these very generally estimated costs can be attributed to PM 2.5 . Additionally, because EPA requires a PSD program for each state, these costs are not unique to Iowa and would likely vary little from state to state. In addition, the Department estimated costs of preparing PSD permit applications, based on information from consultants that prepare PSD applications for their clients. Total application preparation costs ranged from $25,000 to $100,000. Typically, a project does not go through PSD review for just one pollutant. Costs attributed to PM 2.5 would be only a portion of the PSD application costs, likely ranging from 15 percent to 50 percent.9 The PSD program is a national program imposed through the Clean Air Act, so any company locating a large, new facility or considering a major expansion in any state in the United States will be required to go through PSD review. Although PSD requirements are consistent across states, some of the variables include the cost to apply for a PSD permit and the turnaround time to get a PSD permit. The Department does not charge a fee for submitting a PSD permit application. Application fees in other states range from several hundred dollars per project to tens of thousands of dollars per project. The Department’s no

- cost PSD application process may have a positive impact on jobs. Because companies ar e allowed to conduct only very limited preparatory construction activities prior to obtaining the PSD permit, it is a significant incentive for the company to receive the PSD permit as quickly as possible. For this reason, the Department’s no

- cost applicat ion and relatively quick turnaround time may be incentives for companies to build or expand in Iowa. This may be a positive jobs impact for industrial jobs. These amendments are intended to implement Iowa Code subsections 455B.133(1), 455B.133(4), and 455B .133(5) and the U.S. Clean Air Act (CAA) Title I, Part C (CAA §160

- 169b; U.S.C. §7470

- 7492). These amendments will become effective on September 12, 2012. The following amendments are adopted.
Item 1. Amend the following definitions in subrule 33.3(1) : “Ba seline area” means: 1. Any intrastate area (and every part thereof) designated as attainment or10

unclassifiable under Section 107(d)(1)(D) or (E) 107(d)(1)(A)(ii) or (iii) of the Act in which the major source or major modification establishing the minor sou rce baseline date would construct or would have an air quality impact equal to or greater than 1 ug/m 3 (annual average) of the pollutant for which the minor source baseline date is established for the pollutant for which the baseline date is established, a s follows: equal to or greater than 1 μg/m

3 (annual average) for sulfur dioxide (SO 2 ), nitrogen dioxide (NO 2 ) or PM 10 ; or equal to or greater than 0.3 μg/m 3 (annual average) for PM 2.5 . 2. Area redesignations under Section 107(d)(1)(D) or (E) 107(d)(1)(A)(ii) or (iii) of the Act cannot intersec t or be smaller than the area of impact of any major stationary source or major modification which establishes a minor source baseline date or is subject to regulations specified in this rule, in 40 CFR 52.21 (PSD requirements), or in department rules appr oved by EPA under 40 CFR Part 51, Subpart I, and would be constructed in the same state as the state proposing the redesignation.
3. Any baseline area established originally for the total suspended particulate increments shall remain in effect and shall ap ply for purposes of determining the amount of available PM 10 increments, except that such baseline area shall not remain in effect if the permitting authority rescinds the corresponding minor source baseline date in accordance with the definition of “basel ine date” specified in this subrule. “Baseline date” means: 1. Either “major source baseline date” or “minor source baseline date” as
follows: (a) The “major source baseline date” means, in the case of particulate matter
PM 10 and sulfur dioxide, January 6, 1975 , and ; in the case of nitrogen dioxide, February11

8, 1988 ; and in the case of PM 2.5 , October 20, 2010

. (b) The “minor source baseline date” means the earliest date after the trigger date on which a major stationary source or a major modification subjec t to 40 CFR 52.21 as amended through November 29, 2005, October 20, 2010, or subject to this rule (PSD program requirements), or subject to a department rule approved by EPA under 40 CFR Part 51, Subpart I, submits a complete application under the relevant regulations. The trigger date for particulate matter PM 10 and sulfur dioxide is August 7, 1977. For nitrogen dioxide, the trigger date is February 8, 1988. For PM 2.5 , the trigger date is October 20,
2011.
2. The “baseline date” is established for each pol lutant for which increments or other equivalent measures have been established if: (a) The area in which the proposed source or modification would construct is designated as attainment or unclassifiable under Section 107(d)(i)(D) or (E) 107(d)(1)(A)(ii) or (iii) of the Act for the pollutant on the date of its complete application under 40 CFR 52.21 as amended through November 29, 2005, October 20, 2010, or under regulations specified in this rule (PSD program requirements); and (b) In the case of a major st ationary source, the pollutant would be emitted in significant amounts, or in the case of a major modification, there would be a significant net emissions increase of the pollutant. Any minor source baseline date established originally for the total suspen ded particulate increments shall remain in effect and shall apply for purposes of determining the amount of available PM 10 increments, except that the reviewing authority may rescind any such minor source baseline date where it can be shown, to the satisfa ction of the12

reviewing authority, that the emissions increase from the major stationary source, or the net emissions increase from the major modification, responsible for triggering that date did not result in a significant amount of PM 10 emissions. “Enfor ceable permit condition,” for the purpose of this chapter, means any of the following limitations and conditions: requirements development developed pursuant to new source performance standards, prevention of significant deterioration standards, emissions standards for hazardous air pollutants, requirements within the SIP, and any permit requirements established pursuant to this chapter, any permit requirements established pursuant to 40 CFR 52.21 or Part 51, Subpart I, as amended through November 29, 2005, October 20, 2010, or under conditional, construction or Title V operating permit rules. “Federally enforceable” means all limitations and conditions which are enforceable by the Administrator and the department, including those federal requirements not ye t adopted by the state, developed pursuant to 40 CFR Parts 60, 61 and 63; requirements within 567

— subrules 23.1(2) through 23.1(5); requirements within the SIP; any permit requirements established pursuant to 40 CFR 52.21 or under regulations approved purs uant to 40 CFR Part 51, Subpart I, as amended through November 29, 2005, October 20, 2010, including operating permits issued under an EPA

- approved program, that are incorporated into the SIP and expressly require adherence to any permit issued under such program. “Regulated NSR pollutant” means the following:
1. Any pollutant for which a national ambient air quality standard has been promulgated and any constituents or precursors for such pollutants identified by the13

Administrator (e.g., volatile organic c ompounds and NO X are precursors for ozone); : (a) Volatile organic compounds and nitrogen oxides are precursors to ozone in all attainment and unclassifiable areas; (b) Sulfur dioxide is a precursor to PM 2.5 in all attainment and unclassifiable

areas; (c) N itrogen oxides are presumed to be precursors to PM 2.5 in all attainment and unclassifiable areas, unless the department demonstrates to EPA’s satisfaction or EPA demonstrates that emissions of nitrogen oxides from sources in a specific area are not a signi ficant contributor to the area’s ambient PM 2.5 concentrations; (d) Volatile organic compounds are presumed not to be precursors to PM 2.5 in any attainment and unclassifiable areas, unless the department demonstrates to EPA’s
satisfaction or EPA demonstrate s that emissions of volatile organic compounds from sources in a specific area are a significant contributor to that area’s ambient PM 2.5 concentrations;
2. Any pollutant that is subject to any standard promulgated under Section 111 of the Act;
3. Any Clas s I or Class II substance subject to a standard promulgated under or established by Title VI of the Act; or
4. Any pollutant that otherwise is subject to regulation under the Act as defined in 33.3(1), definition of “subject to regulation.”
5. Notwithstand ing paragraphs “1” through “4,” the definition of “regulated NSR pollutant” shall not include any or all hazardous air pollutants that are either listed in Section 112 of the Act or added to the list pursuant to Section 112(b)(2) of the Act and14

that have n ot been delisted pursuant to Section 112(b)(3) of the Act, unless the listed hazardous air pollutant is also regulated as a constituent or precursor of a general pollutant listed under Section 108 of the Act.
6. Particulate matter (PM) emissions, PM 2.5 emi ssions and PM 10 emissions shall include gaseous emissions from a source or activity which condense to form particulate matter at ambient temperatures. “Significant” means: 1. In reference to a net emissions increase or the potential of a source to emit
any of the following pollutants, a rate of emissions that would equal or exceed any of the following rates: Pollutant and Emissions Rate

● Carbon monoxide: 100 tons per year (tpy)

● Nitrogen oxides: 40 tpy

● Sulfur dioxide: 40 tpy

● Particulate matter: 25 tpy of particulate matter emissions or 15 tpy of PM 10 emissions

● PM 10 : 15 tpy

● PM 2.5 : 10 tpy of direct PM 2.5 emissions; 40 tpy of sulfur dioxide emissions; 40 tpy of nitrogen oxide emissions (unless the department demonstrates to EPA’s satisfaction that emi ssions of nitrogen oxides from sources in a specific area are not a significant contributor to the area’s ambient PM 2.5 concentrations)

● Ozone: 40 tpy of volatile organic compounds or NO x

● Lead: 0.6 tpy15 ● Fluorides: 3 tpy

● Sulfuric acid mist: 7 tpy

● Hy drogen sulfide (H 2 S): 10 tpy

● Total reduced sulfur (including H 2 S): 10 tpy

● Reduced sulfur compounds (including H 2 S): 10 tpy

● Municipal waste combustor organics (measured as total tetra

- through

octa

- chlorinated dibenzo

- p - dioxins and dibenzofurans): 3.2 × 10 - 6 megagrams per year (3.5 × 10 - 6 tons per year)

● Municipal waste combustor metals (measured as particulate matter): 14 megagrams per year (15 tons per year)

● Municipal waste combustor acid gases (measured as sulfur dioxide and hydrogen chloride): 3 6 megagrams per year (40 tons per year)

● Municipal solid waste landfill emissions (measured as nonmethane organic compounds): 45 megagrams per year (50 tons per year)
2. “Significant” means, for purposes of this rule and in reference to a net
emissions in crease or the potential of a source to emit a regulated NSR pollutant not listed in paragraph “1,” any emissions rate.
3. Notwithstanding paragraph “1,” “significant,” for purposes of this rule, means any emissions rate or any net emissions increase associ ated with a major stationary source or major modification, which would construct within ten kilometers of a Class I area , and have an impact on such area equal to or greater than 1 μg/m 3 (24

- hour average).16 Item 2. Amend subrule 33.3(3) as follows: 33.3(3) Ambient air increments. The provisions for ambient air increments as specified in 40 CFR 52.21(c) as amended through November 29, 2005, October 20, 2010, are adopted by reference.

Item 3. Amend subrule 33.3(9) as follows: 33.3(9) Exemptions. The provisions for allowing exemptions from certain requirements for PSD

- subject sources as specified in 40 CFR 52.21(i) as amended through May 1, 2007, October 20, 2010, are adopted by referen ce.

Item 4. Amend subrule 33.3(11) as follows: 33.3(11) Source impact analysis. The provisions for a source impact analysis as specified in 40 CFR 52.21(k) as amended through November 29, 2005, October 20, 2010, are adopted by reference.

Item 5. Amend su brule 33.3(16) as follows: 33.3(16) Sources impacting federal Class I areas

— additional requirements. The provisions for sources impacting federal Class I areas as specified in 40 CFR 51.166(p) as amended through November 29, 2005, October 20, 2010, are ado pted by reference. The following phrases contained in 40 CFR 51.166(p) are not adopted by reference: “the plan may provide that,” “the plan shall provide that,” “the plan shall provide” and “mechanism whereby.”17 Item 6. Amend subrule 33.3(18) as follows: 3 3.3(18) Source obligation.

a. Approval to construct shall not relieve any owner or operator of the responsibility to comply fully with applicable provisions of the plan and any other requirements under local, state or federal law. b. At such time that a particular source or modification becomes a major stationary source or major modification solely by virtue of a relaxation in any enforceable limitation which was established after August 7, 1980, on the capacity of the source or modification otherwise to emit a pollutant, such as a restriction on hours of operation, the requirements of subrules 33.3(10) through 33.3(19) shall apply to the source or modification as though construction had not yet commenced on the source or modification.

c. Any owner or ope rator who constructs or operates a source or modification not in accordance with the application pursuant to the provisions in rule 567

— 33.3(455B) or with the terms of any approval to construct, or any owner or operator of a source or modification subject to the provisions in rule 567

— 33.3(455B) who commences construction after April 15, 1987 (the effective date of Iowa’s PSD program), without applying for and receiving department approval, shall be subject to appropriate enforcement action. d. Approval to construct shall become invalid if construction is not commenced within 18 months after receipt of such approval, if construction is discontinued for a period of 18 months or more, or if construction is not completed within a reasonable time. The departmen t may extend the 18

- month period upon a satisfactory18

showing that an extension is justified. These provisions do not apply to the time between construction of the approved phases of a phased construction project; each phase must commence construction withi n 18 months of the projected and approved commencement date.

e. Reserved. f. The Except as otherwise provided in subparagraph (8), the following specific provisions shall apply to with respect to any regulated NSR pollutant emitted from projects at exist ing emissions units at a major stationary source, other than projects at a source with a PAL, in circumstances in which where there is a “reasonable possibility,” within the meaning of subparagraph (8), that a project that is not part of a major modificati on may result in a significant emissions increase of such pollutant , and the owner or operator elects to use the method for calculating projected actual emissions as specified in subrule 33.3(1), paragraphs “1” through “3” of the definition of “projected

a ctual emissions.” (1) Before beginning actual construction of the project, the owner or operator shall document and maintain a record of the following information:
1. A description of the project;
2. Identification of the emissions unit(s) whose emissions of a regulated NSR pollutant could be affected by the project; and
3. A description of the applicability test used to determine that the project is not a major modification for any regulated NSR pollutant, including the baseline actual emissions, the proje cted actual emissions, the amount of emissions excluded under paragraph “3” of the definition of “projected actual emissions” in subrule 33.3(1), an19

explanation describing why such amount was excluded, and any netting calculations, if applicable. (2) No le ss than 30 days before beginning actual construction, the owner or operator shall meet with the department to discuss the owner’s or operator’s determination of projected actual emissions for the project and shall provide to the department a copy of the in formation specified in paragraph “f.” The owner or operator is not required to obtain a determination from the department regarding the project’s projected actual emissions prior to beginning actual construction. (3) If the emissions unit is an existing el ectric utility steam generating unit, before beginning actual construction, the owner or operator shall provide a copy of the information set out in subparagraph (1) to the department. The requirements in subparagraphs (1), (2) and (3) shall not be constru ed to require the owner or operator of such a unit to obtain any determination from the department before beginning actual construction. (4) The owner or operator shall:
1. Monitor the emissions of any regulated NSR pollutant that could increase as a resul t of the project and that is emitted by any emissions unit identified in subparagraph (1);
2. Calculate the annual emissions, in tons per year on a calendar

- year basis, for a period of five years following resumption of regular operations and maintain a

re cord of regular operations after the change, or for a period of ten years following resumption of regular operations after the change if the project increases the design capacity or potential to emit of that regulated NSR pollutant at such emissions unit ( for20

purposes of this requirement, “regular” shall be determined by the department on a case

by

- case basis); and
3. Maintain a written record containing the information required in this subparagraph. (5) The written record containing the information require d in subparagraph (4) shall be retained by the owner or operator for a period of ten years after the project is completed. (6) If the unit is an existing electric utility steam generating unit, the owner or operator shall submit a report to the department within 60 days after the end of each year during which records must be generated under subparagraph (4) setting out the unit’s annual emissions during the calendar year that preceded submission of the report. (7) If the unit is an existing unit other than an electric utility steam generating unit, the owner or operator shall submit a report to the department if the annual emissions, in tons per year, from the project identified in subparagraph (1), exceed the baseline actual emissions, as documented and mai ntained pursuant to subparagraph (4), by an amount that is “significant” as defined in subrule 33.3(1) for that regulated NSR pollutant, and if such emissions differ from the preconstruction projection as documented and maintained pursuant to subparagraph (4). Such report shall be submitted to the department within 60 days after the end of such year. The report shall contain the following:
1. The name, address and telephone number of the major stationary source;
2. The annual emissions as calculated pursuan t to subparagraph (4); and
3. Any other information that the owner or operator wishes to include in the21

report (e.g., an explanation as to why the emissions differ from the preconstruction projection). 8) A “reasonable possibility” under this paragraph (pa ragraph 33.3(18) “f” ) occurs when the owner or operator calculates the project to result in either:
1. A projected actual emissions increase of at least 50 percent of the amount that is a “significant emissions increase,” as defined under subrule 33.3(1) (w ithout reference to the amount that is a significant net emissions increase), for the regulated NSR pollutant; or
2. A projected actual emissions increase that, when added to the amount of emissions excluded under subrule 33.3(1), paragraph “3” of the defi nition of “projected actual emissions,” equals at least 50 percent of the amount that is a “significant emissions increase,” as defined under subrule 33.3(1) (without reference to the amount that is a significant net emissions increase), for the regulated NSR pollutant. For a project for which a reasonable possibility occurs only within the meaning of this numbered paragraph, and not also within the meaning of numbered paragraph “1” of this subparagraph (subparagraph (8)), then the provisions of subparagrap hs (3) through (7) do not apply to the project.

g. The owner or operator of the source shall make the information required to be documented and maintained pursuant to paragraph “f” available for review upon request for inspection by the department or the general public pursuant to the requirements for Title V operating permits contained in 567

— subrule 22.107(6).
Item 7. Amend subrule 33.3(20) as follows: 33.3(20) Conditions for permit issuance. Except as explained below, a permit may22

not be issued to any n ew “major stationary source” or “major modification” as defined in subrule 33.3(1) that would locate in any area designated as attainment or unclassifiable for any national ambient air quality standard pursuant to Section 107 of the Act, when the

source or modification would cause or contribute to a violation of any national ambient air quality standar d. A major stationary source or major modification will be considered to cause or contribute to a violation of a national ambient air quality standard when such source or modification would, at a minimum, exceed the following significance levels at any loc ality that does not or would not meet the applicable national standard:

Significant Impact Levels (SILs)

Averaging Time Annual 24 hrs. 8 hrs. 3 hrs. 1 hr. Pollutant ( μg/m 3 ) (μg/m 3 ) (μg/m 3 ) (μg/m 3 ) (μg/m 3 ) SO 2 1.0 5

——— 25

——— PM 10 1.0 5

——— ——— ——— PM 2.5 0.3 1.2

——— ——— ——— NO 2 1.0

——— ——— ——— ——— CO

——— ——— 500

——— 2000 A permit may be granted to a major stationary source or major modification as identified abov e if the major stationary source or major modification reduces the impact of its emissions upon air quality by obtaining sufficient emissions reductions to compensate for its adverse ambient air impact where the major stationary source or major modificatio n would otherwise contribute to a violation of any national ambient air quality standard. This subrule shall not apply to a major stationary source or major modification with respect to a particular pollutant if the owner or operator demonstrates that the source is located in an area designated under Section 107 of the Act as nonattainment for that23

pollutant.
Item 8. Adopt the following new subrule 33.3(22) : 33.3(22) Permit rescission. Any permit issued under 40 CFR 52.21 or this chapter or any permit issue d under rule 567

— 22.4(455B) shall remain in effect unless and until it is rescinded. The department will consider requests for rescission that meet the conditions specified under paragraphs “a” and “b” of this subrule. If the department rescinds a permit o r a condition in a permit issued under 40 CFR 52.21, this chapter, or rule 567

— 22.4(455B), the public shall be given adequate notice of the proposed rescission. Publication of an announcement of rescission in a newspaper of general circulation in the affec ted region 60 days prior to the proposed date for rescission shall be considered adequate notice.

a. The department may rescind a permit or a portion of a permit upon request from an owner or operator of a stationary source who holds a permit for a source or modification that was issued under 40 CFR 52.21 as in effect on July 30, 1987, or earlier, provided the application also meets the provisions in paragraph “b” of this subrule. b. If the application for rescission meets the provisions in paragraph “a” of this subrule, the department may rescind a permit if the owner or operator shows that the PSD provisions under 40 CFR 52.21 would not apply to the source or modification.

[Filed 7/19/12, effective 9/12/12] [Published 8/8/12] E DITOR ’ S N OTE : For replacement pages for IAC, see IAC Supplement 8/8/12.