Colorado Department of Public Health and Environment / Air Pollution Control Division



## Denver Metropolitan Area and North Front Range
8-Hour Ozone State Implementation Plan

Technical Support Document

Determination of Rule Effectiveness

For Proposed Pneumatic Controller and Condensate Tank Regulation

DRAFT
November 10, 2008

Colorado Department of Public Health and Environment
Air Pollution Control Division 4300 Cherry Creek Drive South Denver, Colorado 80246

i

DRAFT - Denver Metro Area/North Front Range 8-hour Ozone SIP Determination of Rule Effectiveness for Proposed Pneumatic Controller and Condensate Tank RegulationColorado Department of Public Health and Environment / Air Pollution Control Division



# Table of Contents

1. PNEUMATIC CONTROLLER REGULATION RULE EFFECTIVENESS DETERMINATION ..............1

1.1. B ACKGROUND

............................................................................................................................... .................1

1.2. D EFINITION OF R ULE E FFECTIVENESS ............................................................................................................1

1.3. D ISCUSSION

............................................................................................................................... .....................1

2. CONDENSATE TANK REGU LATION RULE EFFECTIV ENESS DETERMINATION ...........................3

2.1. C OMPLIANCE I SSUES W HICH I NFORM R ULE E FFECTIVENESS .........................................................................3

2.2. U SE OF EPA RE G UIDANCE FOR C ONDENSATE T ANKS ..................................................................................4

3. REFERENCES

............................................................................................................................... .......................5

ii

DRAFT - Denver Metro Area/North Front Range 8-hour Ozone SIP Determination of Rule Effectiveness for Proposed Pneumatic Controller and Condensate Tank RegulationColorado Department of Public Health and Environment / Air Pollution Control Division



## 1. Pneumatic Controller Regulation Rule Effectiveness
Determination

1.1. Background
Many types of process control devices can be us ed to operate valves that regulate pressure, flow, temperature, and liquid levels. Thes e devices can be operated pneumatically, electrically, or mechanically. A pneumatic device is an instrume nt that is actuated by gas. Most of the devices used by the natural gas industry are pn eumatically oper ated. Although instrument air is commonly used to power pne umatic devices at gas processing facilities, where electricity is readily available and can be used to compress air, the majority of natural gas industry pneumatic devi ces are powered by natural gas.

As part of normal operation, most pneumatic devices emit, or “bleed”, gas to the atmosphere, either continuously or intermittentl y. Pneumatic devices generally consist of a

controller and a valve. Bleed rates are associ ated with the controller. Gas is vented to atmosphere during actuation when valves open and/or close; however , vent rates are not significant and are the same whether a high-bl eed or low-bleed controller is used. The proposed regulation addresses bleed rates from controllers that are actuated by natural gas.



### 1.2. Definition of Rule Effectiveness
Rule Effectiveness (RE) is a term that descri bes a method to account fo r the reality that not all facilities covered by a rule are in compliance with the rule 100% of the time. Rule effectiveness reflects the actual ability of a regulatory program to achieve the emission reductions required by regulation. The concept of applying rule effectiveness in a State Implementation Plan (SIP) emission invent ory has evolved from the observation that regulatory programs (and associated complian ce rates) may be less than 100 percent effective for some source categories.

The Air Pollution Control Division (Division) reviewed the latest Environmental Protection Agency (EPA) guidance (EPA-454/R-05-001), A ppendix B “Revised Rule Effectiveness”, August 2005, for Non-Point Sources) to determine an appropriate RE value. The guidance provides emission inventory preparer s with a listing of factors th at are most likely to affect

RE.



### 1.3. Discussion
The Division determined that the required f actors for Range 2, with a corresponding RE of 70-85%, have been satisfied as discussed below:

• Sources in Compliance - In June 2008 the Division prepared and sent, via Section 111 letters, requests to the oil and gas i ndustry in the Denver Me tro Area and North Front Range (DMA/NFR) non-attainment area (NAA). (Letters were mailed in accordance with the Division’s authority found in Air Quality Control Commission (AQCC) Common Provision Regul ation Section II.C. and Section 25-7-111(2)(i),

1

DRAFT - Denver Metro Area/North Front Range 8-hour Ozone SIP Determination of Rule Effectiveness for Proposed Pneumatic Controller and Condensate Tank RegulationColorado Department of Public Health and Environment / Air Pollution Control Division

C.R.S. This is an official method of gathering information from industry.) The Section 111 letters included requests for submittal of informat ion related to the presence of high- and low-bleed devices (as described above) and indicated that affected sources must either report th ese controllers to the Division (via Air Pollution Emission Notices or a permit appli cation, if such thresholds were reached) or replace the controllers w ith low-bleed devices. Indus try reported that all but approximately 85 controllers had been repl aced or would be replaced by November 2008. At a minimum, industry had committed to converting approximately 95 percent of high-bleed devices to low-bleed by November 2008.

• Compliance Certification – As described above, affect ed companies certified their retrofitting of pneumatic controllers via their response to the Division’s Section 111 letters. These signed and dated response letters are on file with the Division.

• Compliance Assistance – The Division, with industry and the Regional Air Quality Council (RAQC), hosted a presentation on pne umatic controllers in June 2008. This presentation allowed industry to learn th e simplicity of retr ofitting devices. EPA GasSTAR information was provided as an additional resource. The Division provided one-on-one customer service to a number of operators who requested additional information and guidance. Thes e consultations allowed the Division an opportunity to clarify technical aspects of pneumatic cont rollers and to provide an example emission calculation.

A RE value of 83 percent was used by the Di vision in recent SIP modeling, although it may have been appropriate to use a higher value. Many companies have already begun implementing the proposed regulation voluntarily, as evidenced from responses to a Section 111 information request letter as desc ribed above. Once the proposed regulation is implemented, companies would be required to obtain permission from the Division to continue using existing high-bleed pneumatic devi ces (e.g., safety exemptions), or to install new ones. Therefore, it is anticipated that the conversion percentage may rise above 95
percent.

The Division has determined that the require d factors for Range 2, with a RE of 70-85%, for pneumatic controllers have been satisfied.

2

DRAFT - Denver Metro Area/North Front Range 8-hour Ozone SIP Determination of Rule Effectiveness for Proposed Pneumatic Controller and Condensate Tank RegulationColorado Department of Public Health and Environment / Air Pollution Control Division



## 2. Condensate Tank Regulation Rule Effectiveness
Determination

In the ozone non-attainment area, Regulation 7 re quires a condensate tank VOC emission control program during the 23 week ozone season (May 1 – Sep 30) that is averaged over the whole system of tank batteries except for small operato rs with emissions under 30 tpy. The system-wide control program has been implemented over th ree years to accommoda te availability and

installation of control devices on thousands of tank batteries . In the first year (2005), tank emissions were required to be reduced by 37.5% sy stem-wide; that figure was increased to 47.5% in 2006 and 75% in 2007. Producers are required to report compliance with the system-wide control requirements on a weekly basis during the ozone season.

In the Early Action Compact (EAC), the Regulati on 7 condensate tank RE of 83% was established by the AQCC at a public hearing in December 2006. RE is a term that describes a method to account for the reality that not a ll facilities covered by a rule are in compliance with the rule 100% of the time. For the development of the 2008 DM A/NFR Ozone SIP the Di vision reevaluated RE based on a review of system-wide reports from the producers. Since each year of the system-wide implementation period had an increased level of stringency in emission controls, the Division

limited the reconsideration of condens ate tank RE to the 2007 ozone season. The 2007 data provide an appropriate and repres entative sample of compliance rates, which should best reflect the fully implemented 75% control specified in the existing rules for 2010 attainment date.

3 

### 2.1. Compliance Issues Whic h Inform Rule Effectiveness
As part of the development of revisions to Regulation No. 7 emission controls for condensate storage tanks, the Division reviewed the application of RE.

As part of this rulemaking, the Division has reviewed the 2005, 2006 and 2007 summer ozone season compliance histories of operators in the NAA. Such a review has allowed the Division to determine operators’ rate of compliance with meeting Regulation No 7 requirements. In essence, a number of large and small companies continue to have challenges with compliance (e.g., failure to m eet 75% system-wide control requirements). In addition, the Division has weighted individual companie s’ Regulation No. 7 compliance histories against their VOC c ontribution in the NAA (as a function of total condensate tanks emissions). Such an effort has allowe d the Division to gauge how operators in the NAA essentially impact VOC emissions.

The Division reviewed submittals from the 25 companies that were subject to Regulation No 7 during the 2005 ozone season. Of these 25 companies, 17 were out of compliance with the season’s 37.5% control requirement. Three enforcement cas es were opened in calendar year 2005 to resolve complia nce issues for Regulation No 7.

For the 2006 ozone season, 16 out of 26 companie s subject to Regulation No 7 had at least one day of non-compliance with the 47.5% contro l requirement. There were 12 companies

DRAFT - Denver Metro Area/North Front Range 8-hour Ozone SIP Determination of Rule Effectiveness for Proposed Pneumatic Controller and Condensate Tank RegulationColorado Department of Public Health and Environment / Air Pollution Control Division

with an average percent cont rol less than the 47.5% requirement for the entire ozone

season.

The Division contracted with Weld County to perform inspecti ons of 214 tank batteries in the 8-hour ozone attainment area during the 2006 ozone season. Of the 214 inspections, 75

flares were out of service. Of these 75 cas es, the inspector observed flare outages which were not reported on the Regulation No 7 emi ssion spreadsheet submittals in 31 cases. (31 / 214 = 14.5% spreadsheet noncompliance; therefore, compliance rate of 85.5%; another data point that supports 83% RE).



### 2.2. Use of EPA RE Gu idance for Condensate Tanks

The Division reviewed the latest EP A guidance (EPA-454/R-05-001), Appendix B “Revised Rule Effectiveness”, August 2005) to determine a RE value. The guidance provides emission inventory preparer s with a listing of factors th at are most likely to affect

RE.

The Division determined that the required f actors for Range 3, with a corresponding RE of

81-86% have been satisfied as discussed below:

• Monitoring: The Division re quires sources to monitor control equipment downtime, production and emissions from each tank batter y. These records are to be reported to the Division each year.

• Compliance History: The facilities have met the compliance schedule, and reports have been filed within the required timeframe.

• Inspections: Unannounced inspections are performed at the facilities. Such inspections include the review of the process and control equipment.

• Control Device Operation and Maintenan ce: Operators are required to monitor control equipment on a weekly basis.

Thus, these analyses demonstrate that a RE value of 83% is appr opriate to apply to

condensate tanks in the NAA.

The Division has three years’ experience with the system-wide approach. Overall compliance has improved over the past three y ears. However, on-site inspections and reported information indicate a compliance di sparity between large producers and small producers. Large producers, which predominat e the number of tanks and their associated emissions, have reported fairly solid compliance with the system-wide control requirements. In fact, VOC-weighted (and hence company-weighted) compliance overall shows an approximately 91% compliance th roughout the system-wide approach. Since these are active enforcement cases, details ar e not included in this document. Conversely, smaller producers have generally had poor reported compliance with the requirements. Future inspections by Division staff and loca l agencies will better bolster our understanding of these suspect compliance rates.

4

DRAFT - Denver Metro Area/North Front Range 8-hour Ozone SIP Determination of Rule Effectiveness for Proposed Pneumatic Controller and Condensate Tank RegulationColorado Department of Public Health and Environment / Air Pollution Control Division



## 3. References

1. U.S. EPA, 2005. “ Emissions Inventory Guidance for Implementation of Ozone and Particulate Matter National Ambient Air Q uality Standards (NAAQS) and Regional Haze Regulations - Appendix B: R evised Rule Effectiveness .” EPA-454/R-05-001. Emissions Inventory Group Emissions, Monitoring and An alysis Division. Office of Air Quality Planning and Standards. U.S. Environmental Protection Agency. Research Triangle Park, NC. August 2005

5

DRAFT - Denver Metro Area/North Front Range 8-hour Ozone SIP Determination of Rule Effectiveness for Proposed Pneumatic Controller and Condensate Tank Regulation