Bay Area Air Quality Management District Amended Regulation as adopted 12/19/2012

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REGULATION 2

PERMITS

RULE 2

NEW SOURCE REVIEW

INDEX

2-2-100 GENERAL

2-2-101 Description 

2-2-102 Exemption, Emissions From Operation of Abatement Devices and Techniques

2-2-103 Incorporation by Reference of Federal PSD Provisions

2-2-200 DEFINITIONS

2-2-201 Adjustment to Emission Reductions for Federal Purposes

2-2-202 Best Available Control Technology (BACT)

2-2-203 Best Available Retrofit Control Technology (BARCT) 

2-2-204 California Coastal Waters

2-2-205 Class I Area 

2-2-206 Contemporaneous 

2-2-207 Creditable

2-2-208 Cumulative Increase

2-2-209 Cumulative Increase Baseline Date

2-2-210 District BACT Pollutant

2-2-211 Emission Reduction Credit

2-2-212 Federal Land Manager

2-2-213 Fully Offset Source

2-2-214 Greenhouse Gases (GHGs) 

2-2-215 Hazardous Air Pollutant (HAP) 

2-2-216 Indian Governing Body

2-2-217 Major Facility

2-2-218 Major Modification 

2-2-219 Net Air Quality Benefit

2-2-220 Net Emissions Increase

2-2-221 Offsets

2-2-222 Pollutant-Specific Basis 

2-2-223 PSD Pollutant

2-2-224 PSD Project

2-2-225 Reasonably Available Control Technology (RACT)

2-2-226 Related Sources

2-2-227 Significant

2-2-300 STANDARDS

2-2-301 Best Available Control Technology Requirement

2-2-302 Offset Requirements, Precursor Organic Compounds and Nitrogen Oxides

2-2-303 Offset Requirements, PM2.5, PM10 and Sulfur Dioxide
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2-2-304 PSD BACT Requirement 

2-2-305 PSD Source Impact Analysis Requirement 

2-2-306 PSD Additional Impacts Analysis Requirements

2-2-307 Consideration of Class I Area Impacts

2-2-308 NAAQS Protection Requirement

2-2-309 Compliance Certification

2-2-310 Denial, Failure to Meet Permit Conditions

2-2-400 ADMINISTRATIVE REQUIREMENTS

2-2-401 Application

2-2-402 Notice to EPA and Federal Land Manager of PSD Applications 

2-2-403 Authority to Construct, Preliminary Decision

2-2-404 Publication of Notice and Opportunity for Public Comment

2-2-405 Public Inspection 

2-2-406 Authority to Construct, Final Action

2-2-407 Issuance, Permit to Operate

2-2-408 Permit to Operate, Final Action

2-2-409 Source Obligation, Relaxation of Enforceable Conditions

2-2-410 Permit Conditions

2-2-411 Offset Refunds 

2-2-412 Demonstration of NOx and POC Offset Program Equivalence

2-2-413 No Net Increase Status Report

2-2-414 BACT Workbook

2-2-500 MONITORING AND RECORDS

2-2-501 Post-Construction Monitoring 

2-2-600 MANUAL OF PROCEDURES

2-2-601 Ambient Air Quality Monitoring

2-2-602 Good Engineering Practice (GEP) Stack Height 

2-2-603 Baseline Emissions Calculation Procedures 

2-2-604 Emission Increase/Decrease Calculation Procedures, New Sources and Changes at 

Existing Sources

2-2-605 Emission Reduction Credit Calculation Procedures 

2-2-606 Potential to Emit (PTE) Increase Calculation Procedures for Purposes of Determining 

Cumulative Increase

2-2-607 Cumulative Increase Calculation Procedures

2-2-608 Facility Un-Offset Cumulative Increase Calculation Procedures

2-2-609 Official Record of Cumulative Increases and Offsets

2-2-610 Facility Emissions Calculation Procedures, Cargo Carriers

2-2-611 Emission Calculation Procedures, Fugitive Emissions
Bay Area Air Quality Management District Amended Regulation as adopted 12/19/2012

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REGULATION 2

PERMITS 

RULE 2

NEW SOURCE REVIEW

(Adopted December 19, 2012)

2-2-100 GENERAL

2-2-101 Description: This Rule applies to all new and modified sources that are subject to the 

requirements of Section 2-1-301 and/or 2-1-302. The purpose of this Rule is to 

implement the New Source Review provisions of the federal and California Clean Air 

Acts (including the federal non-attainment New Source Review, Prevention of 

Significant Deterioration, and Minor New Source Review provisions) and the no-netincrease requirements of the California Health and Safety Code, among other 

requirements.

2-2-102 Exemption, Emissions From Operation of Abatement Devices And Techniques: 

The BACT requirements of Section 2-2-301 shall not apply to emissions of secondary 

pollutants that are the direct result of the use of an abatement device or emission 

reduction technique implemented to comply with the BACT or BARCT requirements 

for control of another pollutant. However, the APCO shall require the use of 

Reasonably Available Control Technology (RACT) for control of emissions of such

pollutants. 

2-2-103 Incorporation by Reference of Federal PSD Provisions: Where federal PSD 

provisions in 40 C.F.R. Section 52.21 are incorporated by reference in this Rule, all 

associated procedures, definitions, and other regulatory provisions in the Code of 

Federal Regulations applicable for implementing such provisions are also 

incorporated by reference and shall be followed and applied by the APCO in 

implementing such provisions, including but not limited to all of the implementing 

definitions set forth in 40 C.F.R. Section 52.21(b), which include the definitions in 

Sections 52.21(b)(13) (baseline concentration), 52.21(b)(14) (major source baseline 

date), 52.21(b)(15) (baseline area), 52.21(b)(18) (secondary emissions), and 

52.21(b)(50) (subject to regulation). Where such regulatory provisions are

incorporated by reference, the incorporation is to the version of that regulatory 

provision in effect upon December 19, 2012.

2-2-200 DEFINITIONS

2-2-201 Adjustment to Emission Reductions for Federal Purposes: An adjustment made, 

for purposes of the equivalence demonstration in 2-2-412, to an emission reduction

due to changes in federal requirements between issuance of a banking certificate and 

its use. The adjustment is made as if the source providing the offsets were in 

operation, at the original baseline levels, on the date of credit use.

2-2-202 Best Available Control Technology (BACT): An emission limitation, control device, 

or control technique applied at a source that is the most stringent of:

202.1 The most effective emission control device or technique that has been 

successfully utilized for the type of equipment comprising such a source; or
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202.2 The most stringent emission limitation achieved by an emission control 

device or technique for the type of equipment comprising such a source; or

202.3 The most effective control device or technique or most stringent emission 

limitation that the APCO has determined to be technologically feasible for a 

source, taking into consideration cost-effectiveness, any ancillary health and 

environmental impacts, and energy requirements; or

202.4 The most effective emission control limitation for the type of equipment 

comprising such a source that is contained in an approved implementation 

plan of any state, unless the applicant demonstrates to the satisfaction of the 

APCO that such limitation is not achievable.

Under no circumstances shall BACT be less stringent than any emission control 

required by any applicable provision of federal, state or District laws, rules or 

regulations. 

2-2-203 Best Available Retrofit Control Technology (BARCT): An emission limitation that 

has been adopted or proposed to be adopted as part of the current Clean Air Plan 

approved by the District pursuant to the California Clean Air Act of 1988 as

implementing the maximum degree of emissions reduction achievable by a class or 

category of source, taking into account environmental, energy and economic impacts.

2-2-204 California Coastal Waters: The area bounded by (i) the coast of the State of 

California and (ii) the line established by starting at the point on the California coast at 

the California-Oregon border, and proceeding:

thence to 40.0°N, 125.5°W;

thence to 39.0°N, 125.5°W;

thence to 38.0°N, 124.0°W;

thence to 37.0°N, 123.5°W;

thence to 36.0°N, 122.5°W;

thence to 35.0°N, 121.5°W;

thence to 34.0°N, 120.5°W;

thence to 33.0°N, 119.5°W;

thence to 32.5°N, 118.5°W;

and thence to an ending point on the California coast at the California-Mexico border.

2-2-205 Class I Area: Point Reyes National Seashore and any other area designated as a

Class I Area under Part C of the Clean Air Act. All other areas in the District are Class 

II Areas.

2-2-206 Contemporaneous: Occurring (i) within a five year period of time immediately prior 

to the date of a complete application for an authority to construct or permit to operate

for a source; or (ii) on or after the date of a complete application for an authority to 

construct or permit to operate but prior to initial operation of the source (or for a 

source that is a replacement unit, as defined in 40 C.F.R. Section 51.165(a)(1)(xxi), 

that will replace an existing source in whole or in part, with respect to emission 

reduction credits being generated by the shutdown of the existing source being 

replaced, 90 days after initial operation of the replacement unit).

2-2-207 Creditable: For purposes of determining the net emissions increase associated with 

a new or modified source (or group of sources) under Section 2-2-220, an emission 

increase or decrease is creditable if it has not been relied on by a permitting agency 

in issuing a PSD permit, including a federal PSD permit or an authority to construct 

applying the PSD provisions of Sections 2-2-304 through 2-2-307, which permit is still 

in effect at the time of initial operation of the source(s).
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2-2-208 Cumulative Increase: The increase in the potential to emit a pollutant authorized by 

an authority to construct or permit to operate measured against prior actual or 

potential emissions, less any contemporaneous onsite emission reduction credits

credited to the authority to construct or permit to operate, calculated in accordance 

with the procedures set forth in Section 2-2-607.

2-2-209 Cumulative Increase Baseline Date: April 5, 1991, for all pollutants except PM2.5; 

and <effective date of revised regulation> for PM2.5.

2-2-210 District BACT Pollutant: Precursor organic compounds (POC), non-precursor 

organic compounds (NPOC), oxides of nitrogen (NOx), sulfur dioxide (SO2), PM10, 

PM2.5, and carbon monoxide (CO).

2-2-211 Emission Reduction Credit: Emission reductions associated with a physical 

change, change in method of operation, change in throughput or production, or other 

similar change at a source that are in excess of the reductions required by applicable 

regulatory requirements, and that are real, permanent, quantifiable, and enforceable, 

as calculated in accordance with Section 2-2-605.

2-2-212 Federal Land Manager: With respect to any lands in the United States, the Secretary 

of the department with authority over such lands, or a subordinate acting under the 

authority of such Secretary.

2-2-213 Fully Offset Source: A source with an emission cap or emission rate contained in a 

permit condition for which the permit applicant provided offsets and/or 

contemporaneous on-site emission reduction credits for the entire amount of the 

emission cap or emission rate. A source for which the District provided offsets from 

the Small Facility Banking Account is not a fully offset source (except where the 

District has been fully reimbursed for any offsets from the Small Facility Banking 

Account).

2-2-214 Greenhouse Gases (GHGs): The air pollutant that is defined in 40 C.F.R. Section 

86.1818-12(a), which is a single air pollutant made up of a combination of the 

following six constituents: carbon dioxide, nitrous oxide, methane, 

hydrofluorocarbons, perfluorocarbons, and sulfur hexafluoride. GHG emissions shall 

be measured (i) based on total mass for purposes of determining whether a facility 

exceeds the 100/250 ton major PSD facility thresholds under Section 2-2-224.1; and 

(ii) as CO2 equivalent emissions (CO2e) according to the methodology set forth in 40 

C.F.R. Section 52.21(b)(49)(ii) for determining whether the emissions constitute a 

PSD pollutant as defined in Section 2-2-223, are regulated NSR pollutants as defined 

in 40 C.F.R. Section 52.21(b)(50), or constitute significant emissions as defined in 

Section 2-2-227.1.

2-2-215 Hazardous Air Pollutant (HAP): Any pollutant that is listed pursuant to Section 

112(b) of the federal Clean Air Act.

2-2-216 Indian Governing Body: The governing body of any tribe, band, or group of Indians 

subject to the jurisdiction of the United States and recognized by the United States as 

possessing power of self-government.

2-2-217 Major Facility: For purposes of the New Source Review requirements of Regulation 

2, Rule 2, a major facility is a facility that has the potential to emit 100 tons per year or 

more of POC, NOx, SO2, PM10, PM2.5, and/or CO. Fugitive emissions shall be 

included in calculating the facility’s potential to emit under this Section if and only if 

the facility is in one of the 28 categories listed in Section 169(1) of the Clean Air Act. 

A physical change at a facility that does not otherwise qualify as a major facility is a 

new major facility if the change would constitute a major facility by itself. 
Bay Area Air Quality Management District Amended Regulation as adopted 12/19/2012

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2-2-218 Major Modification*: A new source as defined in Section 2-1-232, or a modified 

source as defined in Section 2-1-234, or any combination of such new and modified 

sources at a facility that are part of a single common project, that (i) are or will be 

located at an existing major facility and (ii) will cause an increase in emissions of a 

pollutant for which the facility is a major facility, calculated according to Section 2-2-

604, of the following amounts or more:

POC: 40 tons per year

NOx: 40 tons per year

SO2: 40 tons per year

PM10: 15 tons per year

PM2.5: 10 tons per year

CO: 100 tons per year

*Note that the term “Major Modification” is not used in Regulation 2, Rule 2 for purposes of applying the 

Rule’s PSD requirements. The term “PSD Project” is used instead to define new facilities and 

modifications to existing facilities that are subject to the Rule’s PSD requirements. See Section 2-2-224.

2-2-219 Net Air Quality Benefit: A net improvement of air quality as determined by the APCO 

resulting from emission reduction credits impacting the same general area affected by

the new or modified source and which will be consistent with reasonable further 

progress towards the attainment of the applicable air quality standard.

2-2-220 Net Emissions Increase: For purposes of applying the PSD provisions and NAAQS 

Protection requirements of this Rule, a net emissions increase from a new source or 

modified source (or group of such sources) is the sum of the new emissions from the 

new source(s) and/or the increase in emissions from the modified source(s), plus any 

other creditable contemporaneous emissions increases at the facility calculated 

according to Section 2-2-604, less any other creditable contemporaneous emissions 

decreases at the facility calculated according to Section 2-2-604.

2-2-221 Offsets: Offsets are any of the following:

221.1 banked emission reduction credits approved in accordance with District 

Regulation 2, Rule 4; or

221.2 banked emission reduction credits from adjacent Districts if the applicant 

demonstrates that the requirements of Clean Air Act Section 173(c)(1) (42 

U.S.C. Section 7503(c)(1)) and Health and Safety Code Section 40709.6 

have been met or do not apply;

that are provided to compensate for cumulative increases in emissions pursuant to 

Section 2-2-302 or 2-2-303.

2-2-222 Pollutant-Specific Basis: A term used to describe a regulatory requirement 

governing multiple pollutants. If a regulatory requirement applies on a pollutantspecific basis, the requirement applies only for the individual pollutant(s) for which a 

source or facility meets the relevant applicability criteria, and does not apply for 

pollutant(s) for which the source or facility does not meet the relevant applicability 

criteria.

2-2-223 PSD Pollutant: Any Regulated NSR Pollutant as defined in EPA’s PSD Regulations 

at 40 C.F.R. Section 52.21(b)(50), except pollutants for which the San Francisco Bay 

Area has been designated as non-attainment of a California or National Ambient Air 

Quality Standard. If a pollutant is subject to both federal and California ambient air 

quality standards, the pollutant shall be treated as a PSD Pollutant for (and only for) 

the ambient air quality standard(s) for which the San Francisco Bay Area has not 

been designated as non-attainment.
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2-2-224 PSD Project: A new source as defined in Section 2-1-232, or a modified source as 

defined in Section 2-1-234, or a combination of such new or modified sources that are 

part of a single common project, that meets all of the following criteria:

224.1 Major PSD Facility: The source(s) are or will be located at a facility that has 

the potential to emit 100 tons or more per year of any PSD pollutant*

(including fugitive emissions) if it is in one of the 28 categories listed in 

Section 169(1) of the Clean Air Act, or 250 tons or more of any PSD 

Pollutant* (not including fugitive emissions) if it is not in a listed category; and

224.2 Significant Increase in Emissions of PSD Pollutant: The new emissions from 

the new source(s) and/or the increase in emissions from the modified 

source(s) calculated according to Section 2-2-604 constitute significant

emissions of any PSD pollutant as defined in Section 2-2-227.1; and

224.3 Significant Net Increase in Emissions of PSD Pollutant: The net emissions 

increase associated with the new or modified source(s), as defined in Section 

2-2-220, constitute significant emissions of any PSD pollutant as defined in 

Section 2-2-227.1.

Any physical change or change in method of operation that takes place at a facility 

that does not meet the Major PSD Facility criteria specified in subsection 224.1, but 

which change would constitute a Major PSD Facility under the criteria in subsection 

224.1 by itself, is a PSD Project.

*Note that for purposes of applying the 100/250 ton-per-year major PSD facility threshold in Section 2-2-

224.1, the term PSD pollutant is defined to exclude GHGs where they are emitted in an amount of less 

than 100,000 tons CO2e per year. Thus, for a facility to satisfy the major PSD facility test in Section 2-2-

224.1 based on its GHG emissions, the GHG emissions (i) must be over 100,000 tons per year CO2e for 

the emissions to constitute a PSD pollutant, and (ii) must be over the 100/250 ton absolute mass 

threshold for the facility to constitute a major emitter of that pollutant. See Section 2-2-223; see also 40 

C.F.R. § 52.21(b)(50)(iv) and 40 C.F.R. § 52.21(b)(49)(iv)&(v).

2-2-225 Reasonably Available Control Technology (RACT): For sources that are to 

continue operating, RACT is the lowest emission limit that can be achieved by the 

specific source by the application of control technology taking into account 

technological feasibility and cost-effectiveness, and the specific design features or 

extent of necessary modifications to the source. For sources which are or will be shutdown, RACT is the lowest emission limit that can be achieved by the application of 

control technology to similar, but not necessarily identical categories of sources, 

taking into account technological feasibility and cost-effectiveness of the application 

of the control technology to the category of sources only and not to the shut-down 

source.

2-2-226 Related Sources: Two or more sources where the operation of one is dependent 

upon, supports or affects the operation of the other(s). 

2-2-227 Significant: The term “significant” has the following meanings when used in the 

following contexts:

227.1 For determining whether an increase in emissions of a PSD pollutant is 

“significant” for purposes of the PSD provisions of this Rule, the increase is 

significant:

1.1 if it exceeds the values specified in the following table, or for a PSD 

pollutant that is not listed in the following table, if it is greater than 

zero; or

1.2 if it is from a source that is or would be located within 10 kilometers 

of a Class I area, and it would have an impact in such Class I area 

equal to or greater than 1 μg/m3(24-hour average).
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227.2 For determining whether an increase in emissions is “significant” for purposes 

of the NAAQS Protection Requirement in Section 2-2-308 and the public 

notice requirement in Section 2-2-404, the increase is significant if it exceeds 

the values specified in the following table.

Pollutant

Significant Emissions Rate

kg/yr (ton/yr)

Carbon monoxide 90,500 (100)

Nitrogen oxides 36,200 (40)

Sulfur dioxide 36,200 (40)

Total particulate matter 22,680 (25)

PM10 13,575 (15)

PM2.5* 9050 (10)

VOC* 36,200 (40)

GHGs** 67,875,000** (75,000**)

Lead 530 (0.6)

Fluorides 2720 (3)

Sulfuric Acid Mist 6350 (7)

Hydrogen Sulfide 9050 (10)

Total Reduced Sulfur 9050 (10)

Reduced Sulfur 

Compounds 9050 (10)

Municipal waste combustor 

organics 3.2 x 10-3

(3.5 x 10-6)

Municipal waste combustor 

metals 13,575 (15)

Municipal waste combustor 

acid gases 36,200 (40)

Municipal solid waste 

landfill emissions 45,250 (50)

*Pollutants for which the Bay Area is designated as non-attainment of a NAAQS are not subject to the 

PSD requirements in Sections 2-2-304 through 2-2-307 by operation of 40 C.F.R. Section 52.21(i)(2). 

PM2.5 and VOC (as an ozone precursor) are therefore not subject to these PSD requirements as long as 

the Bay Area remains non-attainment for any PM2.5 or ozone NAAQS, respectively.

**Per Section 2-2-214, emissions of GHGs are measured as CO2e for purposes of determining whether an 

emissions increase exceeds this significance threshold. Per Section 2-2-223 and 40 C.F.R. 

Sections 52.21(b)(50)(iv) and 52.21(b)(49)(iv)&(v), increases in GHG emissions of less than 75,000 tons 

per year CO2e are excluded from the definition of PSD pollutant and are not subject to the PSD 

requirements of Regulation 2, Rule 2.

2-2-300 STANDARDS
Bay Area Air Quality Management District Amended Regulation as adopted 12/19/2012

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2-2-301 Best Available Control Technology Requirement: An authority to construct and/or 

permit to operate for a new or modified source shall require BACT to control 

emissions of District BACT pollutants under the following conditions:

301.1 New Source: An authority to construct and/or permit to operate for a new 

source shall require BACT to control emissions of a District BACT pollutant if 

the source will have the potential to emit that pollutant in an amount of 10.0 or 

more pounds on any day as defined in Regulation 2-1-217;

301.2 Modified Source: An authority to construct and/or permit to operate for a 

modified source shall require BACT to control emissions of each District 

BACT pollutant for which the source is “modified” as defined in Section 2-1-

234 for which:

2.1 the source, after the modification, will have the potential to emit that

pollutant in an amount of 10.0 or more pounds on any day as defined 

in Regulation 2-1-217; and

2.2 the modification will result in an increase in emissions of that 

pollutant above baseline levels calculated pursuant to Section 2-2-

604.

The BACT requirements in this Section shall apply on a pollutant-specific basis. 

2-2-302 Offset Requirements, Precursor Organic Compounds and Nitrogen Oxides:

Before the APCO may issue an authority to construct or permit to operate for a new 

or modified source at any facility that will have the potential to emit more than 10 tons 

per year of NOx or POC after the new or modified source is constructed (including 

emissions from cargo carriers per Section 2-2-610), offsets must be provided 

according to the following requirements:

302.1 If the facility will have the potential to emit more than 10 tons per year but less 

than 35 tons per year of NOx or POC after the new or modified source is 

constructed, offsets must be provided at a 1:1 ratio for any un-offset 

cumulative increase in emissions at the facility and any related sources since 

the baseline date determined in accordance with Section 2-2-608.

1.1 The APCO shall provide any required offsets from the Small Facility 

Banking Account in the District’s Emissions Bank in accordance with 

Section 2-4-414, unless the Small Facility Banking Account is 

exhausted or the applicant (or any entity controlling, controlled by, or 

under common control with the applicant) owns or controls offsets. 

1.2 If the Small Facility Banking Account is exhausted, or if the applicant 

owns or controls offsets, the applicant shall provide any required 

offsets.

1.3 A permit limit for which offsets have been provided from the Small 

Facility Banking account may not be higher than the source’s 

maximum physical/design capacity to emit air pollutants, and may not 

be higher than is reasonably necessary to satisfy the applicant’s 

operational requirements (including sufficient flexibility to allow for 

future changes in operational requirements).

302.2 If the facility will have the potential to emit 35 tons per year or more of NOx or

POC after the new or modified source is constructed, the applicant shall:

2.1 Reimburse the Small Facility Banking Account for any cumulative 

increase for which offsets were previously provided from the Small 

Facility Banking Account; and
Bay Area Air Quality Management District Amended Regulation as adopted 12/19/2012

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2.2 Provide federally-enforceable offsets at a 1.15:1 ratio for any unoffset cumulative increase in emissions at the facility and any related 

sources since the baseline date determined in accordance with 

Section 2-2-608.

302.3 An applicant may reimburse the Small Facility Banking Account under 

subsection 302.2.1 by reducing the cumulative increase associated with the 

permitting action(s) for which the District provided the Small Facility Banking 

Account credits. To do so, the applicant must request a lower emissions limit 

in a permit for which the Small Facility Banking Account credits were 

provided. Upon approval by the APCO, the amount by which the applicant 

must reimburse the Small Facility Banking Account shall be reduced by the 

difference between the old permit limit and the new permit limit. 

302.4 The offset requirements in this Section shall be applied on a pollutant-specific 

basis.

2-2-303 Offset Requirements, PM2.5, PM10 and Sulfur Dioxide: Before the APCO may issue 

an authority to construct or permit to operate for a new of modified source at a facility 

that will have the potential to emit 100 tons per year or more of PM2.5, PM10 or sulfur 

dioxide after the new or modified source is constructed (including emissions from 

cargo carriers per Section 2-2-610), the applicant shall provide offsets according to 

the following requirements:

303.1 If the un-offset cumulative increase in emissions of PM2.5, PM10 or sulfur 

dioxide at the facility and any related sources since the baseline date 

determined in accordance with Section 2-2-608 exceeds 1 ton per year, the 

applicant shall provide offsets at a 1:1 ratio for the un-offset cumulative 

increase since the baseline date.

303.2 NOx and/or sulfur dioxide offsets may be provided in place of PM10 offsets 

required under subsection 303.1 at offset ratios determined by the APCO to 

result in a net air quality benefit. Any approval of the use of NOx and/or sulfur 

dioxide offsets under this subsection shall be based on an analysis specific to 

the individual facility for which the determination is made, which shall include 

adequate modeling; and any such approval shall be granted only after public 

notice and an opportunity for public comment and with EPA concurrence.

303.3 Any NOx and/or sulfur dioxide offsets provided in place of PM10 offsets must 

be provided in addition to any NOx and/or sulfur dioxide offsets required 

independently as a result of the source’s NOx and/or sulfur dioxide 

emissions.

303.4 The offset requirements in this Section shall be applied on a pollutant-specific 

basis.

2-2-304 PSD BACT Requirement: An authority to construct for a PSD Project shall require

federal PSD Best Available Control Technology as defined in Section 169(3) of the 

federal Clean Air Act (“federal PSD BACT”) for each PSD pollutant for which the net 

increase in emissions from the PSD Project will be significant as defined in Section 2-

2-227.1. If federal PSD BACT is required for a pollutant under this Section, the 

authority to construct shall require federal PSD BACT for each new or modified 

source for which there will be an increase in emissions of that pollutant by any 

amount, calculated in accordance with Section 2-2-604. The APCO shall impose 

federal PSD BACT in an authority to construct subject to this Section according to 

and in satisfaction of all of the requirements applicable to federal PSD BACT under 
Bay Area Air Quality Management District Amended Regulation as adopted 12/19/2012

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40 C.F.R. Section 52.21(j), including any applicable exemptions from that Section’s 

requirements under 40 C.F.R. Section 52.21(i). 

2-2-305 PSD Source Impact Analysis Requirement: The APCO shall not issue an authority 

to construct for a PSD Project unless the APCO determines, for each PSD pollutant 

for which the net increase in emissions from the PSD Project will be significant as 

defined in Section 2-2-227.1, that the net increase in emissions from the PSD Project

will not cause or contribute to a violation of (i) any applicable ambient air quality 

standard for such pollutant or (ii) any applicable PSD increment for such pollutant, as 

set forth in 40 C.F.R. Section 52.21(c). The APCO shall make such determination in 

accordance with the following procedures:

305.1 Pre-application Air Quality Analysis: The applicant shall prepare and submit 

an analysis of ambient air quality in the area that the PSD Project would 

affect for each PSD pollutant for which the net increase in emissions allowed 

by the authority to construct will be significant. The applicant’s analysis shall 

be prepared according to and shall satisfy all of the requirements applicable 

to air quality analyses for federal PSD permitting under 40 C.F.R. Section 

52.21(m)(1), including any applicable exemptions from that Section’s 

requirements under 40 C.F.R. Section 52.21(i).

305.2 PSD Source Impact Analysis: The applicant shall demonstrate, for each PSD 

pollutant for which the net increase in emissions allowed by the authority to 

construct will be significant, that the net increase in emissions of such 

pollutant will not cause or contribute to a violation of (i) any applicable 

California or National Ambient Air Quality Standard for such pollutant or (ii) 

any applicable PSD increment for such pollutant, as set forth in 40 C.F.R. 

Section 52.21(c). The applicant’s analysis and demonstration shall be 

prepared according to and shall satisfy all of the requirements applicable to 

PSD source impact analyses for federal PSD permitting under 40 C.F.R. 

Section 52.21(k), including any applicable exemptions from that Section’s 

requirements under 40 C.F.R. Section 52.21(i).

305.3 Air Quality Models: All estimates of ambient concentrations required under 

this Section shall be based on applicable air quality models, databases, and 

other requirements specified in Appendix W of Part 51 of Title 40 of the Code 

of Federal Regulations (Guideline on Air Quality Models). Where an air 

quality model specified in Appendix W is inappropriate, the model may be 

modified or another model substituted upon written approval by the APCO 

after public notice and opportunity for public comment under the procedures 

set forth in Section 2-2-404. Where modeling is conducted solely to evaluate 

compliance with a California air quality standard, any APCO-approved model 

may be used.

305.4 APCO Determination: The APCO shall determine, based on the applicant’s 

submissions and any other relevant information, whether any net emissions 

increases of PSD pollutants that the authority to construct will authorize in 

significant amounts would cause or contribute to a violation of (i) any 

applicable California or National Ambient Air Quality Standard for such 

pollutant or (ii) any applicable PSD increment for such pollutant, as set forth 

in 40 C.F.R. Section 52.21(c), for any PSD pollutant. In making this 

determination, the APCO shall use the same procedures and be subject to 

the same requirements as are applicable to the Administrator for issuing 

federal PSD permitting under 40 C.F.R. Section 52.21(k), including any 
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applicable exemptions that Section’s requirements under 40 C.F.R. Section 

52.21(i).

2-2-306 PSD Additional Impacts Analysis Requirements: Before issuing an authority to 

construct for a PSD Project, the APCO shall conduct the following additional impact 

analyses:

306.1 Visibility, Soils & Vegetation Impact Analysis: The applicant shall prepare and 

submit an analysis of the impairment to visibility, soils and vegetation that 

would occur as a result of the PSD Project and any commercial, residential, 

industrial, and other growth associated with the PSD Project. The applicant’s 

analysis shall be prepared according to and shall satisfy all of the 

requirements applicable to air quality analyses for federal PSD permitting 

under 40 C.F.R. Section 52.21(o)(1), including any applicable exemptions 

that Section’s requirements under 40 C.F.R. Section 52.21(i). The analysis 

need not address impacts on vegetation having no significant commercial or 

recreational value. 

306.2 Associated Growth Analysis: The applicant shall prepare and submit an 

analysis of the air quality impact projected for the area as a result of general 

commercial, residential, industrial, and other growth associated with the PSD 

Project. The applicant’s analysis shall be prepared according to and shall 

satisfy all of the requirements applicable to air quality analyses for federal 

PSD permitting under 40 C.F.R. Section 52.21(o)(2), including any applicable 

exemptions that Section’s requirements under 40 C.F.R. Section 52.21(i).

306.3 APCO Review: The APCO shall review the applicant’s additional impact 

analyses to ensure that they are complete and accurately reflect the 

circumstances associated with the PSD Project.

2-2-307 Consideration of Class I Area Impacts: If, within 30 days after receiving notice 

under Section 2-2-404 of a preliminary decision to issue an authority to construct for 

(i) a new major facility or a major modification of a major facility for NOx, VOC, SO2 or 

PM2.5 or (ii) a PSD Project, the Federal Land Manager with responsibility for 

administering any Class I Area provides the APCO with a demonstration that 

emissions from the project would have an adverse impact on the air quality-related 

values of the Class I Area (including visibility), the APCO shall promptly review and 

consider such demonstration. If the APCO concurs with such demonstration, or if the 

APCO concludes based on an independent review of the analysis submitted under 

Section 401.4 that the project will have such adverse impact, the APCO shall, after 

consultation with the Federal Land Manager and the applicant, deny the application 

for an authority to construct. If the APCO finds that such demonstration does not 

establish to the APCO’s satisfaction that the project would have such adverse impact, 

the APCO shall explain its decision (or give notice of where such explanation can be 

obtained) in any subsequent notice of a public hearing held under Section 2-2-404.7.

2-2-308 NAAQS Protection Requirement: The APCO shall not issue an authority to 

construct for a new or modified source that will result in a significant net increase in 

emissions of any pollutant for which a National Ambient Air Quality Standard has 

been established unless the APCO determines, based upon a demonstration 

submitted by the applicant, that such increase will not cause or contribute to an 

exceedance of any National Ambient Air Quality Standard for that pollutant. Such 

demonstration shall be made using the procedures for PSD Air Quality Impact 

Analyses set forth in subsections 2-2-305.1 through 2-2-305.4. Such demonstration 

shall not be required for ozone. A PSD Air Quality Impact Analysis and determination 
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for a new or modified source that satisfies the requirements of Section 2-2-305 shall 

satisfy the requirements of this Section for all pollutants included in such analysis.

2-2-309 Compliance Certification: The APCO shall not issue an authority to construct for a 

new major facility or a major modification of an existing major facility unless the 

applicant provides a list, certified under penalty of perjury, of all major facilities within 

the state of California owned or operated by the applicant or by any entity controlling, 

controlled by, or under common control with the applicant and demonstrates by 

certifying under penalty of perjury that they are either in compliance, or on a schedule 

of compliance, with all applicable state and federal emission limitations and 

standards. The APCO may request the applicant to provide any technical information 

used by the applicant to certify compliance.

2-2-310 Denial, Failure to Meet Permit Conditions: The APCO shall deny a permit to 

operate for a source if, after providing written notification to the applicant and an 

opportunity to remedy any violation, the source is operating in violation of any 

condition specified in the authority to construct, or if any other source used to provide 

emission reduction credits for the source that is owned or operated by the applicant is 

operating in violation of any permit condition limiting emissions such that the required 

emission reduction credits are not actually being provided.

2-2-400 ADMINISTRATIVE REQUIREMENTS

2-2-401 Application: An application for an authority to construct under this Rule shall conform 

to the requirements of District Regulation 2-1-402, and shall include the following:

401.1 A detailed description of the proposed new source(s) or modification(s) for 

which the authority to construct is sought, including at a minimum (i) a 

description of the nature, location, design capacity, and typical operating 

schedule of the source(s) or modification(s), including specifications and 

drawings showing its design and plant layout, and (ii) a detailed schedule for 

construction of the source(s) or modification(s). 

401.2 All information necessary for the APCO to determine whether the application 

satisfies the requirements of this Rule, including but not limited to (i) a 

demonstration of how the application satisfies applicable BACT standards 

under Sections 2-2-301 and 2-2-304, and (ii) the PSD analyses and 

demonstrations required under Sections 2-2-305 and 2-2-306, if applicable.

401.3 CEQA-related information required under Section 2-1-426; and for a new 

major facility, and for a modification to a major facility that will increase 

emissions by more than 100 tons per year of carbon monoxide, 40 tons per 

year of precursor organic compounds, nitrogen oxides, or sulfur dioxide, or 

10 tons per year of PM2.5, an analysis of alternative sites, sizes, production 

processes, and environmental control techniques for such proposed source 

that demonstrates that benefits of the proposed source significantly outweigh 

the environmental and social costs imposed as a result of its location, 

construction or modification.

401.4 If the application is for (i) a new major facility or a major modification of major 

facility for NOx, VOC, SO2 or PM2.5 or (ii) a PSD Project, and the project will 

be located in or within 100 km of a Class I area, the application shall include 

an analysis of potential impacts to air quality related values (including 

visibility) in such Class I area for review and consideration by the Federal 

Land Manager of such Class I area. 
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401.5 Any other information requested by the APCO.

2-2-402 Notice to EPA and Federal Land Manager of Receipt of Permit Applications:

When the APCO receives a complete application for an Authority to Construct for a 

PSD Project, the APCO shall transmit a copy of the complete application to EPA

Region IX. If the APCO receives a complete application for (i) a new major facility or 

a major modification of a major facility for NOx, VOC, SO2 or PM2.5 or (ii) a PSD

Project, and the project is located within 100 km of any Class I Area(s), the APCO 

shall transmit a copy of the complete application to the Federal Land Manager(s) with 

responsibility for any such Class I Area(s) within 30 days of receipt and at least 60 

days prior to holding any public hearing on such application, and shall include the 

applicant’s analysis of the anticipated impacts on visibility in such Class I area(s). In 

addition, the APCO shall also notify such Federal Land Manager(s) if the APCO 

receives any advance notification of any such application.

2-2-403 Authority to Construct, Preliminary Decision: If an application for an Authority to 

Construct is subject to the public notice and comment requirements of Section 2-2-

404, the APCO shall make a preliminary decision as to whether an authority to 

construct shall be approved, or denied. The APCO shall make such preliminary 

decision within 90 days following the acceptance of the application as complete,

provided that any fees required in accordance with Regulation 3 are paid; or within a 

longer time period if necessary to complete any PSD impact analyses required under 

Sections 2-2-305 and 2-2-306, if necessary to complete any CEQA analyses if the 

District is the CEQA Lead Agency, or if consented to by the applicant.

2-2-404 Publication of Notice and Opportunity for Public Comment: If the application is 

for (i) a new major facility or a major modification of an existing major facility, (ii) any 

new facility, or a modification of any existing facility, that will involve an increase in 

emissions of CO, NOx, SO2, PM10, PM2.5, VOC, or lead, calculated in accordance with 

Section 2-2-604, in an amount that is significant as defined in Section 2-2-227.2, or 

(iii) a PSD Project, the APCO shall provide notice of the preliminary decision made 

under Section 2-2-403 according to the following procedures:

404.1 The APCO shall publish a notice stating the preliminary decision of the APCO 

and inviting written public comment on it. The notice shall state the location

of the information available pursuant to Section 2-2-405, the procedures and 

deadlines for submitting written public comments, and the opportunity for 

requesting a public hearing pursuant to subsection 404.7.

404.2 If the application is for a PSD Project, the notice shall also state the degree of 

PSD increment consumed if a PSD increment consumption analysis has 

been conducted.

404.3 The APCO shall publish the notice prominently on the District’s internet 

website in a manner that will provide the public with routine and ready access;

and if the application is for a new major facility or a major modification of an 

existing major facility, or for a PSD Project, the APCO shall also publish the 

notice prominently in at least one newspaper of general circulation within the 

District.

404.4. The APCO shall transmit a copy of the notice to ARB; EPA Region IX; 

adjacent air districts; the chief executive(s) of the city and county where the 

facility is located; the California State Lands Commission; any Indian 

Governing Body whose lands may be affected by the new or modified 

source(s) that is the subject of the notice; any person who requests such 

specific notification in writing; and, if the application is for a PSD Project 
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located within 100 km of any Class I Area(s), the Federal Land Manager(s) 

with responsibility for any such Class I Area(s).

404.5 If the District is the CEQA Lead Agency with respect to the application, the 

APCO shall also ensure that the applicable CEQA notice and comment 

requirements are followed with respect to any CEQA document. 

404.6 The APCO shall provide a period of at least 30 days following publication of 

the notice required under this Section for members of the public to submit 

written comments, and may extend the public comment period for good 

cause.

404.7 The APCO may elect to hold a public meeting to receive written and verbal 

comments from the public during the public comment period if the APCO 

finds that a public meeting is warranted and would substantially enhance 

public participation in the decision-making process. If the APCO elects to 

hold a public meeting, the APCO shall provide at least 30 days public notice 

of such meeting in the same manner as is required for the notice of 

preliminary decision, and the public comment period under Section 2-2-404.6

shall be extended, at a minimum, until the end of the public meeting.

2-2-405 Public Inspection: If an application for an Authority to Construct is subject to the 

public notice and comment requirements of Section 2-2-404, the APCO shall make 

available for public inspection, at District headquarters, the information submitted by 

the applicant, the APCO’s preliminary decision to grant or deny the authority to 

construct including any proposed conditions and the reasons therefore, and any other 

relevant information on which the APCO’s preliminary decision is based. Any such 

information shall also be transmitted, upon request, to ARB and EPA Region IX. In 

making information available for public inspection, the APCO shall consider any 

claims by the applicant regarding the confidentiality of trade secrets, as designated by 

the applicant prior to submission, in accordance with Section 6254.7 of the California 

Government Code. 

2-2-406 Authority to Construct, Final Action: If an application for an Authority to Construct 

is subject to the public notice and comment requirements of Section 2-2-404, the 

APCO shall consider all public comments received and shall take final action on the 

application: (i) within 60 days after the close of the public comment period, or within 

30 days after final approval of a CEQA Negative Declaration or Environmental Impact 

Report for the project (if applicable), whichever is later; and (ii) if the application is for 

a PSD Project, no later than one year after receipt of the complete application (unless 

a longer period is necessary and is consented to by the applicant). At the time of 

such final action, the APCO shall: 

406.1 Prepare and make publicly available a written response to any public 

comments received explaining how the APCO has considered such 

comments in making a final decision; and

406.2 Provide written notice of the final decision to the applicant, ARB, EPA Region 

IX, any person who submitted comments during the public comment period or 

requested written notice of the final action, and, if the District is a Lead 

Agency under CEQA, in accordance with all applicable CEQA public notice 

and comment requirements.

2-2-407 Issuance, Permit to Operate: Before issuing a permit to operate for a source subject 

to the requirements of this Rule, the APCO shall ensure that the following 

requirements have been met:
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407.1 The APCO shall ensure that all conditions specified in the authority to 

construct have been and are being complied with, or in the case of conditions 

with a future compliance date, that such conditions are reasonably expected 

to be complied with by the applicable compliance date.

407.2 If the permit is for a source for which the applicant complied with the offset 

provisions of Sections 2-2-302 or 2-2-303 with emission reduction credits 

generated after the application date:

2.1 The APCO shall ensure that such emission reduction credits took 

effect or will take effect no later than initial operation of the source

(or, for a source that is a replacement unit, as defined in 40 C.F.R. 

Section 51.165(a)(1)(xxi), that will replace an existing source in whole 

or in part, with respect to emission reduction credits being generated 

by the shutdown of the existing source being replaced, no later than 

90 days after initial operation of the replacement unit); and

2.2 The APCO shall ensure that such emission reduction credits shall be 

maintained throughout the operation of the source.

2-2-408 Permit to Operate, Final Action: The APCO shall take final action to approve, 

approve with conditions, or disapprove a permit to operate a source subject to this 

Rule within 90 days after start-up of the new or modified source, unless such time 

period is extended with the written concurrence of the applicant.

2-2-409 Source Obligation, Relaxation of Enforceable Conditions: At such time as the 

applicability of any requirement of this Rule would be triggered by an existing source 

or facility, solely by virtue of a relaxation of any enforceable limitation on the capacity 

of the source or facility to emit a pollutant, then the requirements of this Rule shall 

apply to the source or facility in the same way as they would apply to a new or 

modified source or facility otherwise subject to this Rule.

2-2-410 Permit Conditions: The APCO may include any permit condition in an authority to 

construct or permit to operate that the APCO determines is necessary to ensure 

compliance with this Rule, including but not limited to conditions controlling the 

operation of the source, of its abatement equipment, or of sources used to generate 

emission reduction credits to comply with Sections 2-2-302 or 2-2-303. Such 

conditions may have a future effective date and may be made conditional on the 

results of source tests, ground level monitors or public complaints.

2-2-411 Offset Refunds: The APCO may refund offsets provided for an authority to construct 

or permit to operate, and waive any associated banking fees, under the following 

circumstances:

411.1 Where an applicant has provided offsets in excess of those required for an 

authority to construct or permit to operate, the APCO shall upon request of 

the applicant refund the difference between the amount of offsets provided 

and the amount of offsets required. 

411.2 Whenever a source for which the owner or operator has provided offsets is 

not constructed (or is constructed but never operated), and the authority to 

construct or permit to operate for the source has expired or has been 

surrendered by the applicant, the APCO shall upon request of the applicant 

refund the offsets provided in connect with the authority to construct or permit 

to operate.

2-2-412 Demonstration of NOx and POC Offset Program Equivalence: By March 1 of 

each year, the District shall submit to EPA a demonstration that NOx and POC offsets 

provided for all new and modified sources within the District, less adjustments to 
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those offsets for federal purposes occurring between credit generation and use, 

exceed federal offset requirements for new major sources or major modifications at 

major stationary sources. Adjustment to emission reductions for federal purposes will 

be required if any of the following occur between the time the credit is generated and 

the time the credit is used:

412.1 BAAQMD adopts a relevant measure or rule that is required for purposes of 

federal attainment demonstration requirements.

412.2 A relevant rule or measure is approved into the State Implementation Plan 

applicable in the BAAQMD;

412.3 EPA promulgates a relevant final rulemaking for either a New Source 

Performance Standard or a Maximum Achievable Control Technology 

Standard.

The demonstration shall include:

412.4 Emission increases represented by all authorities to construct new major 

facilities and major modifications at major facilities issued during the three 

calendar years preceding the demonstration date;

412.5 A list of all emission reductions used to offset those emission increases;

412.6 The emission baselines that were used to calculate the emission reduction;

412.7 The source type, size and category that had generated the emission 

reduction credit; 

412.8 All relevant rules that have been adopted or promulgated since the emission 

reduction had occurred.

412.9 Adjustments to emission reduction for federal purposes for all affected 

projects.

412.10 All of the above for as many non-major projects as are needed to 

demonstrate equivalence.

If the analysis fails to make the required demonstration, the District shall provide 

sufficient offsets to make up the difference out of the Small Facility Banking Account. 

If the Small Facility Banking Account does not contain the necessary surplus 

emission reductions, the District shall obtain the necessary surplus emission 

reductions.

2-2-413 No Net Increase Status Report: The APCO shall publish, in conjunction with the 

triennial update of the Clean Air Plan (CAP), a report demonstrating that the District's 

permitting program complies with the no-net-increase requirements of Section 

40919(b) of the Health and Safety Code. This report shall demonstrate that sufficient 

offsets have been provided, as required by Section 2-2-302, for all permits issued 

during the previous three year CAP period. This report shall be forwarded to the 

California Air Resources Board, Stationary Source Division, for approval.

2-2-414 BACT Workbook: The APCO shall publish and periodically update a BACT

Workbook specifying the BACT requirements for commonly permitted sources. BACT 

will be determined for a source on a case-by-case basis, using the workbook as a 

guidance document, as the most effective control device or technique or most 

stringent emission limitation that meets the requirements of Section 2-2-202.

2-2-500 MONITORING AND RECORDS

2-2-501 Post-Construction Monitoring: The APCO may require as a condition in an 

authority to construct that the owner or operator of a facility for which the authority to 

construct is issued must conduct such ambient air quality monitoring as the APCO 
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determines is necessary to determine the effect that emissions from the facility may 

have, or are having, on air quality in the area. 

2-2-600 MANUAL OF PROCEDURES

2-2-601 Ambient Air Quality Monitoring: Ambient air quality monitoring required pursuant to 

this Rule shall be conducted in accordance with the methods prescribed in the 

Manual of Procedures, Volume VI., and 40 C.F.R. Part 58, Appendix B.

2-2-602 Good Engineering Practice (GEP) Stack Height: Stack heights beyond what is 

consistent with good engineering practices shall not be allowed for purposes of air 

quality modeling undertaken as part of any air quality analysis prepared in connection 

with an application for an authority to construct as required by Sections 2-2-305 

through 2-2-308. This requirement does not limit the actual height of a stack, as long 

as good engineering practice stack heights are used in any such modeling analyses. 

Good engineering practice stack height shall be determined according to 40 C.F.R. 

Section 52.100(ii) and EPA’s Guideline for Determining Good Engineering Practice 

Stack Height, EPA Publication No. EPA-450/4-80-023R (June 1985). 

2-2-603 Baseline Emissions Calculation Procedures: The following methodology shall be 

used to determine a source’s baseline emissions for purposes of calculating an 

emissions increase or decrease from a source under Sections 2-2-604.2, 2-2-605.1, 

and 2-2-606.3:

603.1 Determine Baseline Period Ending Date: The date on which the baseline 

period ends is determined as follows:

1.1 For determining the amount of an emissions increase from a new or 

modified source, the baseline period ends on the date on which the 

application for authority to construct/permit to operate the new or 

modified source is determined to be complete.

1.2 For determining the amount of a contemporaneous emissions 

increase under Section 2-2-220 for a physical change or change in 

the method of operation of a source that was not a modification of the 

source, the baseline period ends on the date the change was first 

implemented at the source.

1.3 For determining the amount of a contemporaneous onsite emission 

reduction credit or a contemporaneous emissions decrease under 

Section 2-2-220, the baseline period ends on the date on which the 

emission reduction becomes enforceable.

1.4 For determining the amount of an emission reduction credit for which 

a banking certificate is sought under Regulation 2, Rule 4, the 

baseline period ends the date on which the banking application is 

determined to be complete.

603.2 Determine Baseline Period: The baseline period is determined as follows:

2.1 For all pollutants other than greenhouse gases, the baseline period is 

the three-year period immediately preceding the baseline period 

ending date established under subsection 603.1.

2.2. For greenhouse gases, the baseline period is determined as follows:

2.2.1 For a new source, the baseline period is a period with zero 

throughput and emissions. For such sources, baseline 

emissions and adjusted baseline emissions are zero for all 

purposes under Section 2-2-603.
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2.2.2 For an existing source that first operated less than 24 

months before the date on which the application for authority 

to construct/permit to operate is determined to be complete, 

the baseline period is a period with maximum potential 

throughput and emissions. For such sources, baseline 

emissions and adjusted baseline emissions are the source’s 

pre-existing potential to emit for all purposes under Section 

2-2-603.

2.2.3 For a modification to an existing electric utility steam 

generating unit as defined in 40 C.F.R. Section 51.166(b)(30) 

that has operated for 24 months or more prior to the date of 

application, the baseline period is any period of 24 

consecutive months selected by the applicant within the 5-

year period immediately preceding the baseline period 

ending date established under subsection 603.1, or other 

such time period that the APCO determines is more 

representative of normal source operation. For evaluating 

emissions from multiple sources, the same 24-month 

baseline period shall be used for all sources.

2.2.4 For a modification to any existing source other than an 

electric utility steam generating unit as defined in 40 C.F.R. 

Section 51.166(b)(30) that has operated for 24 months or 

more prior to the date of application, the baseline period is 

any period of 24 consecutive months selected by the 

applicant within the 10-year period immediately preceding 

baseline period ending date established under subsection 

603.1. For evaluating emissions from multiple sources, the 

same 24-month baseline period shall be used for all sources.

603.3 Determine Baseline Throughput: Baseline throughput is the lesser of: (i) the 

actual average annual throughput during the baseline period; or (ii) the 

average permitted annual throughput during the baseline period, if limited by 

permit condition. If the applicant does not have sufficient verifiable records of 

the source’s operation to substantiate its throughput during any portion(s) of 

the baseline period, the applicant is not entitled to credit for throughput during 

any such portion(s). Throughput shall be based on the source’s operational 

parameter that correlates most closely to the source’s emissions. 

603.4 Determine Baseline Emissions: Baseline emissions are the actual average 

annual emissions during the baseline period (excluding any emissions that 

exceed any regulatory or permit limits). If the applicant does not have 

sufficient verifiable records of the source’s operation to substantiate the 

emission rate during any portion(s) of the baseline period, the applicant is not 

entitled to credit for emissions during any such portion(s).

603.5 Determine Baseline Emissions Rate: The baseline emission rate is the 

emission rate per unit of throughput during the baseline period, calculated by 

dividing the source’s baseline emissions by its baseline throughput.

603.6 Determine Adjusted Baseline Emissions Rate: The adjusted baseline 

emission rate shall be determined by adjusting the baseline emission rate 

downward, if necessary, to reflect the most stringent of RACT, BARCT, and 

applicable federal and District rules and regulations in effect or contained in 
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the most recently adopted Clean Air Plan; except that for purposes of 

determining whether a source or group of sources constitutes a PSD Project 

under Section 2-2-224, the adjusted baseline emission rate shall not be 

adjusted downward to a greater extent than required under the provisions of 

40 C.F.R. Sections 51.166(b)(47)(i)(b) and 51.166(b)(47)(ii)(b) & (c).

603.7 Determine Adjusted Baseline Emissions: The adjusted baseline emissions is 

the adjusted baseline emissions rate multiplied by the baseline throughput

(except where otherwise specified under sections 2-2-603.2.2.1 or 2-2-

603.2.2.2). 

2-2-604 Emission Increase/Decrease Calculation Procedures, New Sources and 

Changes at Existing Sources: The amount of any emissions increase (or decrease) 

associated with a new source, or with a physical change, change in the method of 

operation, change in throughput or production, or other similar change at an existing 

source, shall be calculated according to the following procedures:

604.1 New Source: The emissions increase associated with a new source is the

source’s potential to emit.

604.2 Change to Existing Source: The emissions increase (or decrease) associated 

with a physical change, change in the method of operation, change in 

throughput or production, or other similar change at an existing source

(including a permanent shutdown of the source) shall be calculated as the 

difference between: (i) the source’s potential to emit after the change; and (ii) 

the source’s adjusted baseline emissions before the change, calculated in 

accordance with Section 2-2-603.

2-2-605 Emission Reduction Credit Calculation Procedures: The amount of emission 

reduction credits associated with a physical change, change in method of operation, 

change in throughput or production, or other similar change at a source shall be 

calculated according to the following procedures:

605.1 Non-Fully-Offset Source: For a source that is not fully offset as defined in 

Section 2-2-213, the amount of emission reduction credits is the difference 

between: (i) the source’s adjusted baseline emissions before the change 

calculated pursuant to Section 2-2-603; and (ii) the source’s potential to emit 

after the change. 

605.2 Fully-Offset Source: For a source that is fully offset as defined in Section 2-2-

213, the amount of emission reduction credits is the difference between: (i) 

the source’s potential to emit before the change, adjusted downward, if 

necessary, to reflect the most stringent of RACT, BARCT, and applicable 

federal and District rules and regulations in effect or contained in the most 

recently adopted Clean Air Plan; and (ii) the source’s potential to emit after 

the change.

To qualify as emission reduction credits, the emission reductions associated with any 

such change: (i) must be enforceable through permit conditions; through 

relinquishment of the source’s permit; through physical removal of the source such 

that reinstallation would require a new permit under Regulation 2; or in the case of 

source shutdown where no permit is required for the source being shut down, through 

an alternative legally-enforceable mechanism; and (ii) must be real, permanent, 

quantifiable, and in excess of any reductions required by applicable regulatory 

requirements. Emissions that were offset with credits from the Small Facility Banking 

Account cannot be used to generate emission reduction credits. 
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2-2-21

2-2-606 Potential-to-Emit (PTE) Increase Calculation Procedures for Purposes of 

Determining Cumulative Increase: For purposes of calculating cumulative increase 

under Section 2-2-607, the increase in a source’s potential to emit associated with an 

authority to construct and/or permit to operate for the source shall be calculated 

according to the following procedures:

606.1 New Source: For a new source, the increase in potential to emit is the 

source’s full potential to emit. 

606.2 Modified Source – Offsets Previously Provided: For a modified source, if

offsets have previously been provided for the source’s emissions, then the

increase in potential to emit associated with the modification is the difference 

between:

2.1 the source’s potential to emit after the modification; and

2.2 the source’s potential to emit before the modification, adjusted 

downward, if necessary, to reflect the most stringent of RACT, 

BARCT, and applicable federal and District rules and regulations in 

effect or contained in the most recently adopted Clean Air Plan

606.3 Modified Source – Offsets Not Yet Provided: For a modified source, if offsets 

have not previously been provided for the source’s emissions, then the 

increase in potential to emit associated with the modification is the difference 

between:

3.1 the source’s potential to emit after the modification; and 

3.2 the source’s adjusted baseline emissions before the modification 

calculated in accordance with Section 2-2-603.

For purposes of calculating the cumulative increase associated with a source, the 

source’s emissions shall include emissions from cargo carriers (other than motor 

vehicles) associated with the source as specified in Section 2-2-610.

2-2-607 Cumulative Increase Calculation Procedures: The cumulative increase in 

emissions associated with an authority to construct and/or permit to operate for a 

source shall be calculated as:

607.1 Project Emissions Increase: the increase in potential to emit associated with 

the authority to construct/permit to operate determined in accordance with 

Section 2-2-606; minus

607.2 Contemporaneous Onsite Emission Reduction Credits: any 

contemporaneous onsite emission reduction credits at the facility calculated 

in accordance with Section 2-2-605 that are credited to the authority to 

construct/permit to operate.

The cumulative increase associated with an authority to construct/permit to operate 

issued in the past shall be determined using the increase in potential to emit and 

contemporaneous onsite emissions reductions credits calculated at the time of 

issuance of the authority to construct/permit to operate. Emission reduction credits

may not be double-counted (e.g., an emission reduction credit may not be applied to 

the cumulative increase calculation for more than one authority to construct/permit to 

operate).

2-2-608 Facility Un-Offset Cumulative Increase Calculation Procedures: For purposes of 

applying the emission offset provisions of Sections 2-2-302 and 2-2-303, a facility’s

un-offset cumulative increase in emissions since the baseline date shall be calculated 

using the following procedures:

608.1 Project Cumulative Increase: The cumulative increase from the project being 

permitted shall be determined in accordance with Section 2-2-607. 
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608.2 Prior Un-Offset Cumulative Increase: For each previous authority to 

construct/permit to operate issued for the facility, and for any related source 

as defined in Section 2-2-226, after the cumulative increase baseline date as 

specified in Section 2-2-209 (but excluding any authority to construct/permit 

to operate issued because a source lost its permit exemption per Section 2-1-

424 and any authority to construct/permit to operate for a source that has 

been permanently removed from service), the un-offset cumulative increase 

shall be determined by:

2.1 Calculating the cumulative increase associated with each previous 

authority to construct/permit to operate issued for the facility, and for 

any related source as defined in Section 2-2-226, determined in 

accordance with Sections 2-2-607; and 

2.2 Subtracting any offsets provided in connection with the authority to 

construct/permit to operate (including any offsets provided from the 

District’s Small Facility Banking Account).

608.3 Facility Un-Offset Cumulative Increase: The facility’s un-offset cumulative 

increase shall be determined by adding (i) the project cumulative increase 

calculated according to Section 2-2-608.1 and (ii) the un-offset cumulative 

increase from each previous authority to construct/permit to operate issued 

for the facility, and for any related source as defined in Section 2-2-226, after 

the cumulative increase baseline date as specified in Section 2-2-209 (but 

excluding any authority to construct/permit to operate issued because a 

source lost its permit exemption per Section 2-1-424 and any authority to 

construct/permit to operate for a source that has been permanently removed 

from service) calculated according to Section 2-2-608.2. Offsets shall be 

provided for the facility’s un-offset cumulative increase multiplied by the 

applicable offset ratio specified in Section 2-2-302 and 2-2-303.

2-2-609 Official Record of Cumulative Increases and Offsets: The APCO may establish 

and maintain a database or other accounting document to record the cumulative 

increase (including project cumulative increase and associated emission reduction 

credits) and offsets associated with each authority to construct/permit to operate 

issued for a facility. In calculating the un-offset cumulative increase associated with a 

previous authority to construct/permit to operate under Section 2-2-608.2, the APCO 

may rely on the data specified in such document as conclusive, unless the APCO has 

information that indicates that some other data is more accurate. Records of 

cumulative increase and offsets shall be updated as necessary to ensure that they 

are current and accurate. 

2-2-610 Facility Emissions Calculation Procedures, Cargo Carriers: For purposes of 

applying the offset requirements of Sections 2-2-302 and 2-2-303, a facility’s potential 

to emit and cumulative increase shall be calculated including emissions from cargo 

carriers (other than motor vehicles) associated with the sources at the facility. When 

applying these offset requirements, facilities that include cargo loading or unloading 

from cargo carriers other than motor vehicles shall include the cargo carriers as part 

of the source that receives or loads the cargo. Accordingly, all emissions from such 

cargo carriers while operating in the District, or within California Coastal Waters up to 

11 nautical miles (12.66 statute miles) from the Golden Gate Bridge (and any 

additional areas of California Coastal Waters adjacent to the District if cargo carrier 

emissions in such areas would have a substantial impact on air quality within the 

District), shall be included as part of the source’s emissions. Emissions from cargo 
Bay Area Air Quality Management District Amended Regulation as adopted 12/19/2012

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carriers shall not be included for purposes of applying any other provisions of this 

Regulation, including the BACT and PSD requirements.

2-2-611 Emission Calculation Procedures, Fugitive Emissions: Any fugitive emissions 

from a source shall be included in calculating the source’s emissions for all purposes 

under this Rule; except that for purposes of determining whether a facility’s emissions 

exceed the 100 ton per year threshold in Section 2-2-217 (for a “Major Facility”) and 

Section 2-2-224.1 (the first element in the definition of “PSD Project”), fugitive 

emissions shall be included only if the facility is in one of the 28 categories listed in 

Section 169(1) of the Clean Air Act.