p.1 

OAR Box 1796 

Prepped by Keeia Richards 

Document Number: 

39) IV-H-65 

Docket Number: 

A-90-37 

Printed 10/31/2008 4:20:37 PM Sheet 39 of 107 
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IV- H-&5 

United States Department of Energy 

Office of the Deputy General Counsel 

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FACSIMILE TRANSMISSION FORM 

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1000 Independence Avenue, SW 

Washington, DC 20585 y 

Phone/202-

Facsimile: 205 

To: Bill Wehrum 

Lynn Hutchinson 

Janet (contractor) 

Facsimile numbers): 202-501-0394 

919-541-5509 

919-484-0122 

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Date Nov. 21, 2002 

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This facsimile is intended only for the use of the recipient(s) to whom it is addressed and may contain 

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regulations we promulgated in 1980, you may modify, or even 

completely replace, or add, emissions units without 

obtaining a major NSR permit^ so long as "actual emissions" 

do not increase by a significant amount over baseline levels 

at the plant as a whole. 

Applicability of the major NSR program must be 

determined in advance of construction and is pollutantspecific. In cases involving existing sources, this 

requires a pollutant-by-pollutant determination of the 

emissions change^ if any, that will result from the physical 

or operational change. Our 1980 regulations implementing 

the PSD and nonattainment major NSR programs thus inquire 

whether the proposed change constitutes a "major 

modification," that is, a pnn-ay^jj4^rnpby.s i r^l change or 

change in the method of operation "that would result in a 

significant net emissions increase of any pollutant subject 

to regulation under the Act." A "net emissions increase" is 

defined as the increase in "actual emissions" from the 

particular physical or operational change (taking into 

account the use of emissions control technology and 

restrictions on hours of operation or rates of production 

where such controls and restrictions are federally 

enforceable), together with your other contemporaneous 

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increases or decreases in actual emissions.4 In order to 

trigger applicability of the major NSR program, the net 

emissions increase must be "significant."5 

Our existing regulations generally define b^a-solino-^—' 

actual emissions as "the average rate, in tpy, at which the 

unit actually emitted the pollutant during a 2-year period 

which precedes the particular date and which is 

representative of normal source operation." The reviewing 

authorities will allow use of a different time period "upon 

a determination that it is more representative of normal 

source operation." We have historically used the 2 years 

immediately preceding the proposed change to establish t-hobaselinel. However, in some cases we have allowed use of an 

earlier period. 

With respect to changes at existing sources, a 

prediction .of whether the physical or operational change 

a. JaHr-TX J 

4 '"In approximate terms, "contemporaneous" emissions 

increases or decreases are those that have occurred between 

the date 5 years immediately preceding the proposed physical 

or operational change and the date that the increase from 

the change occurs. -fSee, for example, §52.21 (b.) (3) (ii) .-J5 *"-Once a modification is determined to be major, the PSD 

requirements apply only to those specific pollutants for 

which there would be a significant net emissions increase. 

fSee, for example, §52.21(j)(3) (BACT) and §52.21(m)(1)(b) 

(air quality analysis) .-J13 

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determining "baseline actual emissions." That is, the 

relevant terminology for calculating a post-modifiedtion 

(change) pre-change emissions increa-s-e for most applications 

is now ^baseline actual emissions^ rather than factual 

emissions.^ You may use any consecutive 24-month period in 

the past 10 years to determine your baseline actual 

emissions. Second, we are supplementing the existing 

" actual-to-poteritial"acrt:ual-to-potential applicability test 

with an " act ual--to- p m jected-actual" actual-to-pro jectedactual applicability test for determining if a non-roufej^e 

physical or operational change at an existing emissions unit 

will result in an emissions increase. Notwithstanding the 

new test, you will still have the ability to conduct an 

"actual—to-potential"actual-to-potential type test within 

the new "-act-ira-l—to-proj acted—actual"1 actual-to-proiectedactual applicability test. In this case, you will not be 

subject to certain recordkeeping requirements that would 

otherwise apply. 

For EUSGUs, we are making several changes to the 

existing procedures and are codifying our current policy for 

calculating the baseline actual emissions. That is, the 

baseline actual emissions for EUSGUs is the average rate, in 

tons—p&r—ye-crertpy, at which that the unit actually emitted 

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t h e pollutan t durin g a 2-yea r (consecutiv e 24-month) perio d 

withi n th e 5-yea r perio d immediatel y precedin g when th e 

owner o r operato r begin s actua l construction . We ar e als o 

retainin g th e optio n tha t allow s th e us e of a differen t time 

perio d i f th e reviewin g authorit y determine s i t i s more 

representativ e of norma l sourc e operation . 

2 . CMA Exhibi t B 

As described in section 1^. Ci. 1— above, we have decided 

to adopt an actual-to-ifitfnyg:-actual methodology, combined 

with a revised process to determine baseline emissions, to 

use in determining when sources are considered to have made 

a modification and are thereby subject to NSR. T-b^refereK 

\$e ajte_=aejfc=-a<i6pt±ii2j the methodology based on potential 

emissions as discussed in the CMA Exhibit B proposal. See 

section III of this preamble for a discussion of the 

comments we received on this proposal and our responses. 

3. Plantwide Applicability Limitations 

A PAL is a voluntary option that will provide you with 

the ability to manage facility-wide emissions without 

triggering major NSR review. We believe-that the added 

flexibility provided under a PAL will facilitate your 

ability to respond rapidly to changing market conditions 

while enhancing the environmental protection afforded under 

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November 19, 2002 

work practice requirements in the permit for the unit that 

were adopted in conjunction with BACT or LAER and the 

project would not alter any physical or operational 

characteristics that formed the basis for the BACT or LAER 

determination. If the project causes the need for a change 

in the emission limitations or work practice requirements in 

the permit for the unit adopted in conjunction with BACT or 

LAER or would alter any physical or operational 

characteristics that formed the basis for the BACT or LAER 

determination, you lose the Clean Unit status. You may 

still proceed with the project without triggering major NSR 

review, if the increase is not a significant net emissions 

increase. Emissions units that have not been through major 

NSR may still qualify for Lhe Clean Unit dfe-s-ig nations tat us 

if they demonstrate that the emissions control level is 

missions control le 

comparable to BACT or LAER. Thic QYrlngiQtt-wouldwill be 

•V — 

valid for up to a 10-year period. The new applicability 

test does not exclude consideration of physical changes or 

changes in the method of operation of Clean Units from major 

NSR, but rather changes the way emissions increases are 

calculated for these changes. This new applicability test 

therefore protects air quality, creates incentives for 

sources to install state-of-the-art controls, provides 

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clarify that you must obtain a permit before you begin 

construction (including for:modifications), that the 

provisions apply for each regulated NSR pollutant that your 

source emits, and that the provisions apply to any source 

located in the area designated as attainment or 

unclassifiable (for §^dr§§ 51.166 and £52^.21). 

We have also .added a new definition for reviewing 

authority that clarifies who has authority to implement 

major NSR programs. Reviewing authority means the State air 

pollution control agency, local agency, other State agency, 

or other agency authorized by the Administrator to carry out 

a permit program under pa rt 5—§-5ir§§ 51.165 and §J 1-5JL .16 6, or 

the Administrator in the case of EPA-implemented permit 

programs under §52.21. 

7. Enforcement 

As noted above, today we are taking final action on 

five changes to the NSR program that create alternative 

means of determining NSR applicability for projects that 

begin actual construction after these provisions become 

effective in your jurisdiction. If you are subsequently 

determined not to have met any of the obligations of these 

new alternatives -for example, failure to meet emissions 

or applicability limits, properly project emissions, and/or 

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properly implement the PCP Exclusion or Clean Unit Test, you 

will be subject to any applicable enforcement provisions 

(including the possibility of citizens' suits) under the 

applicable sections of the Act. Sanctions for violations of 

these provisions may include monetary penalties of up to 

$27,500 per day of violation, as well as the possibility of 

injunctive relief^ which may include the requirement to 

install air pollution controls. Tt—-\ <^-"*-\ » a. - , 

e,^ii\ <- LP\ ** "^ *° \U~<^ 

v t*^ \ 1 '• In most cases, an emisgdTon limitation, operating .p 

restriction., or other requirement must be both legally and f . ^ t 

practically\enforceably by the Administrator, or a State, 

local or tribal air pollution control agency. A "legally 

enforceable" /reauiromont mcaiij. Lh<at some authority has the 

right to enforce \he restriction. Practical enforceability 

for a source-specifVc permit means that the permit's 

provisions must specify: (l)'A technically-accurate 

limitation and the portions of the source subject to the 

limitation; (2) the time Veriod for the limitation (hourly, 

daily, monthly, and annualVimits such as rolling annual 

limits) ; and (3) the method Ao determine compliance 

including appropriate.monitoriVg, recordkeeping, and 

reporting. For rules and generavl permits that apply to 

categories of sources, practicable enforceability 

— " " - * • i If - " ^ •.*••!• • i' i ni.., . -*. — • • — - -- • , ,,, ., ,«. . 

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November 19, 2002 

additionally requires that" the, provisions: 11) identify the 

types or categories of sources that are covered by the rule; 

(2) where coverage is optional, provide for notice to the 

permitting authority of the source's election to be covered 

by the rule; and (3 )\ specify the enforcement consequences, 

relevant to the rule.V T-e&aijJ-s— preamble and mldb use i^e 

.termo "•arfnr,-

Qablo" andV' onf orccablG as & oidullCal thatrtrertf^ 

'JM^tG.rchancf&a-bly tu reifer \o Llie j-eiaiuiieineiiL Lu hdve potn 

leual and practical enforc^abili-Ly-. ^- JA. .f&_j{"" 

federally enforceable. "FederalXenforceability" means that 

not only is a 

described abo 

right to enf o 

reouirement practica 

^e, 

rce 

but in addition. 

restrictions and 

llv enforceable. 

"EVA must have a 

limitations 

as 

direct 

imposed on a 

7 See memorandum, "Release of Interim Policy on Federal 

Enforceability o\ Limitations on Potential to Emit," signed 

by John Seitz and\ Robert Van Heuvelen, Jan. 22, 1996 at 5-6 

and Attachment 4,\available on the Web as 

http://www.epa.gov/rgytgrnj/programs/artd/air/title5/t5memos 

/pottoemi . pdf . Morse detailed guidance on practical 

enforceability is cbntained in the memorandum. 

\ 

\ 

s The Agency has frequently used the term "practicably 

enforceable" and "practical" enforceability," 

interchangeably. Theire is no difference in the meaning of 

these terms. \ 

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November 19, 2002 

source to limit its exposure to Act programs."

 9 J J?or 

computing baseline actual emissions for use in determining; 

major NSR applicability or for establishing a PAL, vou must „ 

consider "legally enforceable" requirements. ¥-hat -arts-, the 

Administrator, jState, local or tribal air pollution control 

agency has thV authority to enforce the requirement 

irrespective of\its practical enforceability. 

,In our existing regulations that are unamended by 

todavXs action, the term "federally enforceability" still 

appear^. In 1995, the court in Chemical Manufacturers Ass'n 

V . EPA 

prograir 

Be 

ru 

is 

in 

cause 

les, 

not 

the 

remanded 

i \ o 

th\ 

the 

in 

Fed 

EPA. 

e cou 

term 

sf tec 

era\ 

the definition 

No.8 9-1514 (D 

rt vacated the . 

of PTE 

.C. Cir 

in the 

a SeP t a 

major NSR 

150 

requirements in the 

federal enforceabilit 

c (pending fina 

rules. Jt-rrslead" 

1 rule 

, tnis 

v as it 

making 

rela 

by th 

term shouiu1995). 

nationwide 

tes to PTE 

e Agency) 

be i-tv^rd"' to 

m'e-aTr-"-f-fe#e>Jsa3Ll\ onf^^^^^ble or legally and practicable 

enfeyeoablo by dy State, or local air r.r.1 1 n-t-Tgn agency." The 

court' s remand, hwever, did not affect SIP requirements^ 

"'"hVi'i ^-his ti?TM yi T 1 continue to ^- — -i-t--

9 See generally memorandum, "5ptions for Limiting the 

Potential to Emit (PTE) of a Stationary Source Under Section 

112 and Title V of the Clean Air \ct," signed by John Seitz 

and Robert Van Heuvelen, Jan. 25, 1995, at 2-3. 

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iffr-plan requirements^-

II. Revisions to the Method for Determining Whether a 

Proposed Modification Results in a Significant Emissions 

Increase 

A. Introduction 

Today we are finalizing two sets of amendments to our. 

existing major NSR regulations that provide another way in 

which you may calculate emissions increases to determine 

whether certain types of physical changes or changes in the 

method of operation (physical or operational changes) of an 

existing emissions•unit —trigger the— major NSR 

requirements.10 The first set of amendments relates to the 

way in which you will determine your baseline actual 

emissions for such emissions units in accordance with a new 

definition of "baseline actual emissions." See, for 

example, new §52.21 (b) (48) . We will be allowing you to use 

any consecutive 24-month period during the 10-year period 

prior to the change to determine your baseline actual 

10 By definition, the modification of an existing source is 

potentially subject to major NSR only if that existing 

source is "major." In addition, when an existing "minor" 

source makes a physical or operational change that by itself 

is major, that change constitutes a major stationary source 

that is subject to major NSR. -fSee, for example, 4-0 CFR 

S3-S52..21 (b) (1) (c) -t 

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emissions for existing emissions units (other than EUSGUs) . 

The second set of amendments replaces the existing "actualto-potential"actual-to-potential and "actual—to— 

representative—actual—annualactual-to-representative-actualannual emissions^ applicability tests for existing emissions 

units (including EUSGUs) with an " actual—tu uiojecLt:dactual"actual-to-projected-actual applicability test for 

determining if a physical or operational change will result 

in an emissions increase at such units.11 (Notwithstanding 

this new test, the actual-to-potential methodology is still 

available at your option under the new applicability tests.) 

The new procedure for determining your pre-change baseline 

actual emissions will not apply to EUSGUs.12 Instead, for 

11 Throughout "this praaffirHja it is assumed that the physical 

change or./chang^in/Cne method of ope^tTb^^^^/non^-roTlitine 

change or is not otherwise exfesip^r^a from review as a 

modification. 

12 For NSR purposes, the, definition of "electric utility 

steam generating unit" means any steam electric generating 

unit that is constructed for the purpose of supplying more 

than one-third of its potential electric output capacity and 

more than 25 MW electrical output to any utility power 

distribution system for sale. Any steam supplied to a steam 

distribution system for the purpose of providing steam to a 

steam-electricsteam electric generator that would produce 

electrical energy for sale is also considered in determining 

the electrical energy output capacity of the affected 

facility. -fSee, for example, 40 CFR 52552.21(b) (31) .r 

Reference in this notice to utility units is meant to 

include all emissions units covered by this definition. 

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determination. Under this approach, in circumstances where 

there is a reasonable possibility that a project that is not 

part of a major modification may result in a significant 

increase of a regulated NSR pollutant, before beginning 

actual construction, srri—owner—or—operator—whro—uses—this 

(JUtrVL 

method mustyou may cJLxege to make and record a projection of 

/ \

 === 

futurepost-change emissions of that pollutant from changed 

units. 

1.3 

To make this projection, the—owner—or—operator—wouldyou 

must use the maximum annual rate at which the modi-fied—unit 

orchanqed units are projected to emit the pollutant in any 

of the 5 calendar years following the time the unit resumes 

regular operations after the project (or 10 years if the 

project increases the unit's design capacity or potential to 

emit the regulated NSR pollutant) . The owner—oi—operatorYou 

then uses- these projections to calculate whether the project 

will result in a significant emissions increase. In making 

this calculation, tlie owner—or operator—wouldyou could 

exclude any emissions that the unit could have accommodated 

15 Note that we plan, in the near future, to issue a Notice 

of Proposed Rulemaking that will address the issue of 

"debottlenecking." In today's rulemaking, we do not intend 

to change current requirements related to "debottlenecking." 

Use of the term "changed unit" should not be interpreted as 

a change to those requirements. 

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have required you to take into account any legally 

enforceable constraints imposed on the facility since the 

selected 12-month time frame, and currently in effect. 

Thus, you would generally have been required to calculate 

the modified emissions unit's baseline actual emissions by 

using the appropriate utilization level from the selected 

12-month period, in combination with the emissions unit's 

current enforceable emission factors. Such enforceable 

emission factors would have included current Federal and 

State limits, such as RACT (Reasonably Available Control 

Technology), MACT (Maximum Achievable Control Technology), 

BACT, LAERj_ and New Source Performance Standards (NSPSJL, as 

well as efrforotrablG or' f QdoraJrJfy enforceable limits 

resulting from any voluntary reductions you may have taken 

(for example, for netting, offsets, or Emission Reduction 

^Credits (ERCs)) - Also, you would have had to consider any 

operational constraints that are enforceable-iffs—a -practical 

matter, such as production limits, fuel use limits, or 

limits to the number of hours per day or days per year at 

which the unit modified, or affected by such modification, 

could operate. 

Finally, we indicated that it was not our intent to 

extend the 5-year contemporaneous period (for considering 

4 3 

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