Fw: Michael Ling

to: Pam Long 05/13/2010 11:03 AM Show Details

OMB docket item

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 add ress two of the points on that issue that Gina and Dom discussed Friday afternoon. I will shor tly also send a short edit to address a small business issue that was also discussed Friday afte rnoon. 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 mo re 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 en sure 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 pe nding projects. We have separately described our plans to expeditiously issue GHG BACT guid ance, but we understand that for pending projects that will be permitted soon after January 2, 2011, an opportun ity for earlier engagement with EPA on BACT issues would be beneficial for permitting author ities 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 thos e 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 th ose 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 assist ance to applicants with pending permits to ensure that GHG permitting decisions are made promptly, and that administrative processes move forward expeditiously. Page 1 of 3

5/13/2010 file://C:\Documents and Settin g s\ p lon g \Local Settin g s\Tem p \notesFCBCEE\~web5504.htmInsert 2, would modify the existing language on step 2. The modifications are shown in bold/strikeout and appear at the end of this se ction, 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.**  Page 2 of 3

5/13/2010 file://C:\Documents and Settin g s\ p lon g \Local Settin g s\Tem p \notesFCBCEE\~web5504.htmMichael Ling
Associate Director Air Quality Policy Division
U.S. EPA - OAQPS (919) 541-4729 Page 3 of 3

5/13/2010 file://C:\Documents and Settin g s\ p lon g \Local Settin g s\Tem p \notesFCBCEE\~web5504.htm