1Some exceptions apply for small refiners and gasoline produced for sale in parts of the

Western United States. For a full description of the program, see the final rule published on February

10, 2000 (65 FR 6698).

OAQPS:ITPID:IIG:DDEROECK:cjmacgill:NCM(MD-12):x5593:1/19/01

January 19, 2001

MEMORANDUM 

SUBJECT: BACT and LAER for Emissions of Nitrogen Oxides and Volatile Organic Compounds

at Tier 2/Gasoline Sulfur Refinery Projects

FROM: John S. Seitz, Director (signed by John S. Seitz)

Office of Air Quality Planning and Standards (MD-10)

TO: Air Division Directors, Regions I-X

Background

On February 10, 2000, EPA issued new emissions standards (“Tier 2 standards”) for all

passenger vehicles, including sport utility vehicles, minivans, vans, and pick-up trucks. As part of this

program, EPA also set new standards to significantly reduce the sulfur content in gasoline. These

standards require that most refiners meet a corporate average gasoline sulfur standard of 120 ppm and

a cap of 300 ppm beginning in 2004. In 2005, most refiners will have to produce gasoline meeting a 30

ppm average sulfur level. By 2006, most refiners will need to meet a 30 ppm average sulfur level, and

an 80 ppm cap.1

In order to meet the new low-sulfur gasoline requirements, some refiners will have to make

changes to their existing facilities. It is likely that some of these changes will be subject to the major

new source review (NSR) preconstruction permitting requirements under either part C or D of the

Clean Air Act, or both. The refiners subject to major NSR will be required to undergo a pollution

control technology evaluation which calls for a level of control equivalent to the best available control

technology (BACT) or the lowest achievable emission rate (LAER), depending on the applicable NSR

program requirements. 
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To provide greater certainty and to help expedite the NSR permitting process for refinery

projects undertaken to comply with the gasoline sulfur standards, EPA believes it would be beneficial to

issue Federal guidance on what levels of control can be reasonably anticipated to represent BACT or

LAER, as applicable, under the major new source review requirements. Specifically, this guidance is

intended to set forth levels of control that, in our view, would generally be considered to satisfy the

BACT or LAER requirements for certain emission units and pollutants associated with required refinery

desulfurization projects. Accordingly, when a permitting authority makes a BACT or LAER

determination consistent with the recommendations contained in this guidance, it is very unlikely that

EPA would comment adversely on such finding. Thus, while State and local permitting agencies are

not required to apply this guidance in establishing BACT or LAER, the guidance is designed to help

add certainty about EPA’s general perspective and expectations as to the applicable technology

requirements for BACT or LAER for types of refinery emissions units identified herein. 

The control technology information discussed in this guidance is based on information and

analyses contained in the attached report titled “Petroleum Refinery Tier 2 BACT Analysis Report.” A

draft report was made available on the Internet for public review on March 20, 2000. Comments

received as a result of that opportunity caused us to perform additional analyses for a number of issues. 

The results of these analyses have been taken into account in the recommendations contained in this

guidance, as well as in the final report which accompanies this guidance memorandum.

It is important to note that applying this guidance for selecting BACT and LAER may not be

appropriate in all cases because of unique circumstances that may exist at individual refineries. The

NSR program requires a case-by-case analysis of BACT and LAER. This guidance is designed to

provide information to permitting authorities in order to streamline that process. In specific cases, the

unique site-specific circumstances at individual refineries may warrant a different level of control than

that suggested by the analysis upon which this general guidance is based. For example, where

additional or new information presented by the applicant or public becomes available, within the context

of the processing of a specific permit application, it should also be considered when doing the BACT or

LAER evaluation.

BACT and LAER for NOx emissions from Refinery Heaters

Based on our review of the information in the attached report, it is EPA’s belief that an

emissions rate of 7 ppmv of NOx should generally be considered as LAER for NOx emissions from

new refinery process heaters. Refiners can achieve this level of control through a combination of

combustion controls (low-NOx burners with internal flue gas recirculation) and selective catalytic

reduction (SCR). 

The emissions rate representing BACT, however, will tend to vary as a function of the size of
3

the new heater being installed at the refinery and whether the baseline heater design includes forced air

(mechanical) draft rather than natural draft. Heater size and air draft design have been shown to

significantly influence the cost-per-ton-removal calculations used for determining whether a NOx

control alternative is cost effective. If mechanical draft is not otherwise appropriate for the process

heater, then its cost as part of the installation of SCR can make the incremental cost economically

infeasible for smaller sized heaters.

Thus, using an upper cost effectiveness threshold of $10,000 per ton of NOx controlled, we

believe that the following maximum emissions levels would generally represent BACT for the five sizes

of new process heaters which we evaluated:

a. 7 ppmv (0.0085 lb/MMBtu) of NOx for new refinery process heaters –

• 75 MMBtu/hr or greater, with a baseline design that includes mechanical draft, and

• 150 MMBtu/hr or greater, with a baseline design that does not include mechanical draft.

The attached study shows that refinery process heaters can achieve a level of control equal to or better

than 7 ppmv of NOx with a combination of combustion controls (low-NOx burners with internal flue

gas recirculation) and SCR. 

b. 29 ppmv (0.035 lb/MMBtu) of NOx for new refinery process heaters –

• 50 MMBtu/hr or less, with a baseline design that includes mechanical draft, and

• 150 MMBtu/hr or less, with a baseline design that does not include mechanical draft.

Available information indicates that refinery process heaters can achieve a level of control of 29 ppmv

or better of NOx by installing combustion controls (low-NOx burners with internal flue gas

recirculation).

As the attached report indicates, certain circumstances that could affect individual refinery

projects may cause BACT analysis results to differ from EPA’s recommendations. Consequently, such

circumstances should be reviewed on a case-by-case basis by the permitting authority. For example,

problems with fouling of the catalyst used in the SCR process may occur over a period of time when

the sulfur content of the refinery fuel gas is higher than normal and other unique conditions within the

process heater exist. (See related discussion of catalyst fouling on page 3-20 in the attached technical

report.) To avoid the fouling problem, the refiner may need to purchase additional natural gas or take

steps to remove some of the excess sulfur from the refinery gas. Either approach will likely produce

additional expenses which could significantly alter the BACT cost analysis.
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The EPA expects that refineries will likely be able to avoid the application of major NSR to

individual or multiple new refinery process heaters of less than 50 MMBTU by controlling emissions to

levels below the 40 tons per year significance level for a major modification of NOx. Consequently, we

do not believe it is appropriate to provide a position on BACT for such small refinery process heaters

at this time. Should the need arise for Federal guidance on BACT for these small heaters within the

context of permitting refinery gasoline desulfurization, we will consider issuing supplemental guidance on

a later date. 

BACT and LAER for VOC emissions from Refinery Equipment

After a review of the information contained in the attached report, it is EPA’s belief that for

VOC emissions from hydrotreaters and hydrogen units, at both large and small refiners, compliance

with an equipment leak control program (equipment modifications, and leak detection and repair)

equivalent to the Hazardous Organic National (HON) Emission Standards for Hazardous Air Pollutants

(40 CFR Part 63 Subpart H) would generally represent BACT. This is the most stringent control level

achievable for VOCs from these units. In evaluating whether compliance with requirements equivalent

to the HON would generally represent BACT, EPA considered the incremental and average cost of the

control strategy as well as any associated energy and environmental impacts. No adverse impacts were

found to be associated with the most effective control option. 

The control option represents the most stringent control level achieved or contained in a SIP, it

therefore also represents LAER for those units. 

Effect of Guidance

The statutory provisions and regulations described in this document contain legally binding

requirements. This document does not substitute for those provisions or regulations, nor is it a

regulation itself. The policies set out in this memorandum do not represent final Agency action, and are

intended as guidance only. Thus, this document does not impose legally binding requirements on EPA,

permitting authorities, or the regulated community, and it may not apply to a particular situation based

upon the circumstances. The EPA and permitting authority decision makers retain the discretion to

adopt approaches on a case-by-case basis that differ from this guidance. Any decisions regarding a

particular facility will be made based on the statute and regulations. The analysis undertaken applies

only prospectively and only to major NSR permit applications for gasoline desulfurization related

projects that have been determined to be complete by the relevant permitting authority no later than 18

months from the date of this memorandum. The EPA may change this guidance at any time without

public notice. 

The EPA will continue to evaluate the need for further guidance on BACT and LAER
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determinations for emission units and other pollutants (e.g., SO2) associated with refinery desulfurization

projects undertaken to comply with Tier 2 requirements and, as necessary, may issue additional

guidance in the future. 

Distribution/Further Information

We are asking Regional Offices to promptly send this memorandum with attachment to State

and local permitting agencies within their jurisdiction. Questions concerning the application of this

guidance to specific BACT or LAER determinations and cases should be directed to the appropriate

EPA Regional Office. Regional Office staff may contact Dan deRoeck of the Integrated

Implementation Group at 919-541-5593, if they have any questions. This document, including the

referenced attachment, is also available on the Internet at http://www.epa.gov/ttn/nsr, under “What’s

New on NSR.”

Attachment