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Michael Ling 

Associate Director 

Air Quality Policy Division 

U.S. EPA - OAQPS 

(919) 541-4729 

-----Forwarded by Michael Ling/RTP/USEPA/US on 05/13/2010 11:03AM ----- 

To: "King, Heidi R." <Heidi_R._King@omb.eop.gov> 

From: Michael Ling/RTP/USEPA/US 

Date: 05/11/2010 09:01AM 

cc: Joseph Goffman/DC/USEPA/US@EPA, Janet McCabe/DC/USEPA/US@EPA, Anna 

Wood/DC/USEPA/US@EPA, Brian Doster/DC/USEPA/US@EPA, Elliott Zenick/DC/USEPA/US@EPA, 

Howard Hoffman/DC/USEPA/US@EPA, Juan Santiago/RTP/USEPA/US@EPA, Joseph 

Mangino/RTP/USEPA/US@EPA 

Subject: 

Two pieces on grandfathering suggestions to address two of the points on that issue that Gina 

and Dom discussed Friday afternoon. I will shortly also send a short edit to address a small 

business issue that was also discussed Friday afternoon. Let me know your reaction. Thanks. 

Insert 1 on grandfathering (would go in section V.E.4 of May 7 draft (right before b. on page 420)

While we do not provide for grandfathering of PSD applications, we do note that there are more 

than seven months left before GHG BACT requirements will be triggered at anyway sources for 

projects that increase GHG emissions by more than 75,000 tpy CO2e and more than a year 

before the requirements would be triggered at sources solely because of emissions of GHGs 

(more than 100,000 tpy of CO2e). We intend to work constructively and affirmatively with 

permitting authorities to use this time to ensure ensure expeditious processing of pending 

permits and to further assure that the triggering of BACT requirements at such sources will not 

result in adverse impacts on pending projects. We have separately described our plans to 

expeditiously issue GHG BACT guidance, but we understand that for pending projects that will be 

permitted soon after January 2, 2011, an opportunity for earlier engagement with EPA on BACT 

issues would be beneficial for permitting authorities to issue these permits without delay. 

Therefore, following the issuance of this rule, we will contact permitting authorities that have 

pending PSD permit applications to identify those applications with a reasonable likelihood that 

final issuance will occur after January 2, 2011, and therefore will be required to contain GHG 

BACT limits. We will then work closely with those permit agencies to provide technical, legal or 

policy assistance to help prepare BACT analysis and provide additional support as necessary to 

expedite permitting for those pending applications. Similarly, when EPA is the permitting 

authority, we will provide assistance to applicants with pending permits to ensure that GHG 

permitting decisions are made promptly, and that administrative processes move forward 

expeditiously. 

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Insert 2, would modify the existing language on step 2. The modifications are shown in 

bold/strikeout and appear at the end of this section, which is excerpted from the May 7 draft 

beginning on page 427 : 

This approach for Step 2 sources that have obtained a minor source 

construction permit or non-applicability determination differs from 

the approach described previously for source that obtained a PSD 

permit prior to Step 1. As described previously, a Step 1 source 

that is authorized to begin actual construction before January 2, 

2011 under a previously-issued PSD permit may begin actual 

construction under that permit after January 2, 2011 without 

modifying the PSD permit to address GHGs. However, a Step 2 source 

that was not required to obtain a PSD permit before Step 2 begins 

would need to obtain a PSD permit addressing GHGs if it has not yet 

begun actual construction prior to Step 2, even if the source had 

obtained any preconstruction approvals that were necessary to 

authorize construction prior to Step 2. This is because such a Step 

2 source that begins actual construction after Step 2 would likely 

be doing so without having any permit meeting the requirements of 

paragraphs (j) through (r)(5) of section 52.21, 51.166, or a state 

equivalent. A source that has obtained only a minor source permit 

prior to Step 2 but that begins actual construction after July 1, 

2011 would violate the requirements of section 52.21(a)(2)(iii), 

51.166(a)(7)(iii), or a state equivalent, unless the source took 

care to ensure that it was authorized to construct under a PSD 

permit or could demonstrate that the source’s minor source 

construction permit makes clear that requirement of paragraphs (j) 

through (r)(5) of sections 52.21, 51.166, or a state equivalent 

would be met by the source even though such a permit was not 

nominally a PSD permit. This difference in approach for non-PSD 

sources is driven by the terms of sections 52.21(a)(2)(iii) and 

51.166(a)(7)(iii). Since we have not provided any prior notice that 

we might be considering revisions to sections 52.21 and 51.166 to 

address this topic, we are unable to revise the regulations in this 

action to achieve the same result for non-PSD sources as for PSD 

sources. Furthermore, at the present time, we see no indication 

that this difference in approach is not unreasonable since non-PSD 

sources will not trigger permitting for GHG until step 2 (only 

anyway PSD source trigger in step 1). Thus sources will have until 

July 1, 2010, an additional 6 months of lead time (for a total of 

more than 14 months) , to prepare for the transition described here. 

 Nevertheless, we recognize that the transition to the increased 

coverage of new sources and modifications that occurs in July will 

represent an unusual occurrence that may have unanticipated impacts. 

 For this reason it is important to note that nothing in this rule 

forecloses our ability to further address such impacts, as 

necessary, by adopting rule changes or using other available tools. 

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Michael Ling 

Associate Director 

Air Quality Policy Division 

U.S. EPA - OAQPS 

(919) 541-4729 

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