UNITED STATES ENVIRONMENTAL PROTECTION AGENCY

REGION 2 290 Broadway New York, NY 10007-1866

March 9, 2009

Mr. Robert Lenney Environmental Health and Safety Modernization Manag er Alcoa Massena Modernization Project Park Avenue East, PO Box 150 Massena, New York 13662

Re: Alcoa Massena Modernization Project Request for a Single Source Determination

Dear Mr. Lenney:

This is in response to Alcoa Inc.’s October 20, 200 8 request for a single source determination and PSD nonapplicability determinatio n for the Massena East and Massena West Plants whose individual property lines are sep arated by approximately 3.4 miles in Massena, New York. This request was augmented by a subsequent submittal dated December 2, 2008. For the reasons noted below, EPA has determined that the Massena East and West Plants can be considered a single sou rce for purposes of PSD/NSR applicability. The issues pertaining to your PSD n onapplicability request will be addressed in a separate letter.

Background

Alcoa is proposing to modernize their Massena East and Massena West aluminum

smelter facilities located in New York. The East a nd West Plant have historically been managed as two distinct and separate operating enti ties. The West Plant has always been owned and operated by Alcoa Inc. The East Plant was previously owned and operated by the former Reynolds Metals Company. In 2000, Alcoa Inc. acquired the Reynolds Metals Company, now a wholly-owned subsidiary of Alcoa Inc . The improvements for the proposed modernization include:

1) At Massena East

--- replacing the Soderberg potline with a modern technology pre-bake potline. Among the physical ch anges include the shutdown and removal of the following: the anode pi n room, the carbon plant, the cathode digging, and three alumina/coke conveyance units. New units to be constructed include an anode cooling pr ocess, a new cruce augering, four new bath filling areas, a bath stora ge silo transfer point, and an aluminum fluoride filling area. No changes will be made to the existing boilers at the East Plant. Under this proposed mod ernization project some existing units will be “debottlenecked.”2

2) At Massena West

--- increasing the throughput of the anode manufac turing facility to supply the needs of the new potline at Massena East as well as the existing potline at Massena West. Also, the Massen a West Plant will be adding metal processing capacity to facilitate the processing of the new additional metal production from both the East and West smelters. Among the physical changes include the removal of three e xisting homogenized

heat treat furnaces. Units to be constructed inclu de 7 new homogenized heat treat furnaces, 3 new molten aluminum melting and h olding furnaces, 3 new in-line filterbox fluxing units. Under this propose d modernization project some existing units will also be “debottlenecked.” There will be no changes made to the existing boilers at the West Plant exce pt for an increase in load demand (debottlenecked). The annual aluminum produ ction at the West Plant will increase from an average of 141,998 tons /year to 160,040 tons/year.

The Massena West Plant is located adjacent to the Massena Power Canal in the Village of Massena. The Massena East Plant property line is l ocated approximately 3.4 miles east of the Massena West Plant property line in Roosevel town. Alcoa has indicated that after the company purchased the East Plant in 2000 its efforts focused on increasing the synergies between the two plants to create one Alco a facility in Massena, NY. According to Alcoa, after the proposed modernization is compl eted, they will be shipping intermediate baked anode products and bath from the West Plant to the East Plant at a rate of approximately 72 trucks per day and they wi ll also be shipping hot metal from the East Plant to the West Plant at a rate of approxima tely 50 hot crucible trucks per day. Furthermore, Alcoa also states that the operations manager is responsible for both facilities, as are most of the other support depart ments, including the environmental health and safety, accounting, purchasing, informat ion technology, human resources, and security departments. In addition, according to Al coa, the employees of these departments will be travelling between the two plan ts to perform their jobs. Therefore, Alcoa is requesting that, for the purpose of PSD ap plicability assessment, the East and West Plants be viewed as a single source following the modernization project.

Discussion

The federal definitions under 40 CFR 52.21 apply. 40 CFR Part 52.21(b)(5) defines a stationary source as:

...any building, structure, facility, or installati on which emits or may emit any air pollutant subject to regulation under the Act.

Furthermore, 40 CFR Part 52.21(b)(6) defines a buil ding, structure, facility or installation, in pertinent part, as:

...all of the pollutant-emitting activities which b elong to the same industrial grouping, are located on one or more contiguous or adjacent properties, and are3

under the control of the same person (or persons un der common control) except the activities of any vessel. Pollutant-emitting a ctivities shall be considered as part of the same industrial grouping if they belong to the same “Major Group” (i.e., which have the same first two digit code) as described in the Standard Industrial Classification Manual, 1972, as amended by the 1977 Supplement....

Common Control

Because both the Massena East Plant and the Massena West Plant are owned and managed by Alcoa Inc., and share the same plant man agement team and departmental personnel, these two facilities are under common co ntrol.

Industrial Grouping

Both the East and West Plants are under the same in dustrial grouping with a Standard Industrial Classification code of 3334 – Primary Al uminum.

Contiguous/Adjacent Location

Over the years, EPA has issued guidance in a number of cases regarding the question of whether two facilities should be considered contigu ous or adjacent. There is no bright line, numerical standard for determining how far ap art activities may be and still be considered “contiguous” or “adjacent.” As explaine d in the preamble to the August 7, 1980 PSD rules, such a decision must be made on a c ase-by-case basis. Moreover, in further explaining this factor, EPA has noted that whether or not two facilities are adjacent depends on the “common sense” notion of a source and the functional interrelationship of the facilities and is not simply a matter of the physical distance between the two facilities. However, the physical distance between two facilities is obviously a factor to be considered in deciding whether the two are close enough to be considered one source in a given situation.

Although there is no clear physical connection via a pipeline or dedicated conveyance between the East and West Plants, their property li nes are separated by approximately 3.4 miles. This distance is consistent with previous Ag ency single source determinations where additional factors were present suggesting th at the plants were contiguous or adjacent. In this case, the proposed operation aft er the modernization, as described by Alcoa, will involve considerable trucking of materi als between the two plants and sharing of personnel. In addition, Alcoa has indicated tha t their intention since purchasing the second plant has been to focus on increasing the sy nergies between the two plants to create one Alcoa facility in Massena, NY. Therefor e, there appears to be a functional inter-relationship between the two plants’ operatio ns.

In this particular case, EPA has weighed the inform ation before it and concluded that, given the totality of the circumstances, the two fa cilities should be considered contiguous or adjacent for purposes of PSD/NSR. Note that no single factor leads us to this

conclusion and EPA retains all of its enforcement a uthorities under the Clean Air Act if4

Alcoa’s operates in a manner different from what ha s been represented to the Agency.

Conclusion

Based on all of the above factors, we have conclude d that Alcoa Inc.’s Massena East

Plant and Massena West Plant do meet the “common se nse” notion of a single source and that they should be treated as one facility for pur poses of PSD and NSR applicability determination. This letter is not a final agency ac tion on the part of EPA.

If you have any questions, please call me at (212) 637-4074 or Mr. Frank Jon, of my staff, at (212) 637-4085.

Sincerely yours,

/ s /

Steven C. Riva, Chief Permitting Section Air Programs Branch

cc: Gary Keating, ERM

bcc: Frank Jon, 2DEPP-APB Joseph Siegel, ORC-Air Kristi Smith, OGC Air Chron, ORC-Air

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