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# OAR Box 1778 Prepped by Ollie Stewart



### Document

Number: 

# 23 ) ll-A-7 Docket Number: 

# A-90-0 6

Printed 10/28/20089:50:52 AM

Sheet 23 of 276P. 2

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# HEPA Unite a State s Environment;, - P'r.-.-vvo n •\rjor.c v Offic e o tA l P'annm o ,-) i ^"S93rc n 7 

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# informatio n fo r Promulgate d Standard sP. 3

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## EPA-450/3-80-033 b



# VO C Fugitiv e Emission s i n Syntheti c Organi c Chemical s Manufacturin g Industry Backgroun d Informatio n fo rPromulgate d Standard s

Emissio n Standard s an d Engineerin g Divisio n

U.S

. ENVIRONMENTA LPROTECTIO N AGENC Y Offic e o fAir , Noise , an d Radiatio n Offic e o fAi rQualit yPlannin g an d Standard s Researc h Triangl e Park , Nort h Carolin a 2771 1

Jun e 198 2P. 4

9 . MODIFICATIO NAN D RECONSTRUCTIO N

Comment s receive d concernin g modificatio nand reconstructio nprovision s (4 0 CF R60.1 4 and 60.15 ) a s the yappl yt o th e standard s hav e bee ndivide d int o si xmai n subjec t areas : (1 ) Clarification,(2 ) Suggestion s fo r Emissio n Criteri a fo r Modifications , (3 ) Suggestion s fo r Change s i nth e Affecte d Facilit yDefinitio nfo r Modifications , (A\ Technica l Problem s wit hRetrofit ; (5 ) Th e Capita l Expenditur e Criterion ; (6 ) Coverag e o f Reconstructions . 9. 1 CLARIFICATIO N Comment : Severa l commenter s requeste d clarificatio no f th e modificatio nan d reconstructio n provisions . (IV-D-26 ; IV-F-1 , No.9 ; IV-F-1 , No.6 ) Response : Sectio n11 1 o f th e Clea nAi r Ac t direct s the Administrato r t o establis h standard s o f performanc e fo r anyne wstationar ysourc e whic hcause s o r contribute s significantl yt o ai r pollutio nwhic hma yreasonabl yb e antici

pate d t o endange r publi c healt ho r welfare . Linder Sectio n111(a)(2 ) and 4 0 CF R60.1 4 and 60.1 5 a ne wsourc e i s define d a s anystationar ysource , the ne wconstruction , reconstructio no r modificatio no f whic hi s commence d afte r th e dat e o f proposa l o f th e standard s (Januar y5 , 1981) . Fo r purpose s o f thes e standards , th e stationar ysourc e i s th e group o f fugitiv e emissio n source s withi n a SOCM I proces s unit . Eac hsuc hgroup o f fugitiv e emissio n source s o nwhic hne wconstruction , reconstruction , o r modificatio ncommence s afte r proposa l i s subjec t t o th e standards , i.e . i s anaffecte d facility . A n existin g facilit yi s th e group o f fugitiv e emissio nsource s withi na SOCM I proces s uni t o nwhic hconstructio nha s no t commence d afte r proposal . The Genera l Provision s (4 0 CF RPar t 60 , Subpar t A ) outlin e th e procedure s fo r implementin g th e Act , includin g th e rule s governin g modifica

tio nand reconstructio n(4 0 CF R60.1 4 and 60.15) . Wit hsom e exceptions , a modificatio n i s define d a s anyphysica l o r operationa l chang e t o anexistin g facilit ywhic hresult s i nanincreas e i nemission s fro mtha t facility . Th e



### 9- 1P. 5

exception s includ e change s sucha s routin e maintenance , repair , andreplace ment ; a nincreas e inproductio nrat e accomplishe dwithou t a capita l expendi ture ; anda

nincreas e inthe hour s o f operation . Th e preambl e to th e propose dstandard s pointe dou t tha t thes e standard s ar e no t intende dt o cove r existin gproces s unit s makin groutin e andmino r additions . Th e standard s (4 0 CFR6 0 Supar t VV ) exclud e suchproces s improvements , .>uc h routin e change s an

daddition s a t existin gSOCM I unit s woul dno t caus e a n existin gfacilit y

t o become a

naffecte dfacilit y

i f th e change s and addition s ar e mad e withou t incurrin ga capita l expenditure . Th e Genera l Provision s defin e "capita l expenditure " (4 0 CFR60.2) ; th e capita l expenditur e criterio ni s discusse dina subsequen t commen t an dresponse . Sectio n60.1 5 defines reconstructio na s replacemen t o f component s o f a n existin gfacilit y

t o suc hanexten t tha t the fixe dcapita l cos t o f th e new component s exceeds 5 0 percen t o f th e fixe dcapita l cos t tha t woul db e require dt o construc t a comparabl e entirel y new facility . I t mus t als o be determine dtha t complianc e i s technologicall y an deconomicall y

feasible . Th e Genera l Provision s allow fo r th e Administrator' s case-by-cas e determi natio no f whethe r propose dreplacement s constitut e reconstruc t on . Bot ho f thes e provision s appl y t o existin gfacilitie s tha t would , i f affecte db

y thes e provisions , become affecte dfacilities . Increase s in emission s wil l b e determinedbased , ingeneral , o nth e numbe r o f fugitiv e emissio nsources ; i f the numbe r o f fugitiv e emissio nsource s increases , emission s increas e unles s a nowne r o r operato r take s specifi c action s o offse t the increas e du e t o the additiona l fugitiv e emissio nsources . e capita l cost s associatedwit hreplacin ga nexistin gfacilit y

i s lii" t e° the cost s associatedwit hreplacin gth e fugitiv e emissio nsource s only . Emission s an

dcapita l cost s associate dwit hothe r sources , suc ha s proc e ven t emissions , ar e no t considere dwhe nevaluatin gth e applicabilit y o thes e provisions . Comment : On e commente r (IV-D-51 ) wrot e tha t the propose dNSP S i s uniqu e inthe NSP S subpart s becaus e i t applie s no t to a proces s bu t rathe r to equipmen t withina categor y

o f processes . Becaus e o f thi s uniqu e difference , t e



### 9- 2P.6
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commente r sai d i t i s difficul t t o connec t th e conten t o f 4 0 CF R60.1 4 in th e Genera l Provision s wit hth e propose d rules . H e recommende d th e followin g additio n t o §60.480 :

Modificatio n o f a-proces s uni t accomplishe d wit h n o ne t increas e i nemission s fro mth e grou p o f fugitiv e emissio nsource s withi nth e proces s uni t shal l no t b e considere d a modificatio nunde r thi s subpart . Response : Th e commente r i s correc t i nhi s interpretatio no f th e modificatio n provisions . Achang e mus t indee d increas e emission s t o b e considere d a modification . B ydefinition , i f a chang e i s accomplishe d withou t a n emission s increase , i t i s no t a modification . Certai nchange s mus t als o requir e a capita l expenditur e t o b e considere d a modification . Th e affecte d facilit yregulate d b yth e standard s i s th e group o f fugitiv e emissio nsource s withi na SOCM I proces s unit . Th e definitio no f th e affecte d facilit yi s clearl ystate d i nth e regulatio n[§60.480(a)] . Th e Genera l Provision s (4 0 CF R60.14 ) us e th e sam e term , "affecte d facility, " (and th e correspondin g term , "existin g facility" ) i nexplainin g th e pro vision s fo r modification . Therefore , EP Aha s conclude d tha t ther e i s n o nee d t o clarif yth e modificatio nprovision s specificall yi nSubpar t VV . Comment : Whil e supportin g th e provisio ni nth e propose d rule s tha t proces s improvement s achieve d withou t a capita l expenditur e ar e no t considere d modifications , on e commente r (IV-D-51 ) offere d on e suggestio nt o improv e thi s provision . H e aske d tha t th e definitio no f Capita l Expenditur e i nth e Genera l Provision s b e restate d i nth e propose d subpar t wit hchange s t o mak e i t clea r fo r thi s subpart . Th e commente r expresse d th e understandin g tha t a facility' s basi s use d t o calculat e th e modificatio ninvestmen t limi t [sic , "capita l expenditure" ] i s onl yth e affecte d facilit yand no t th e entir e oroces s unit . H e sai d th e presen t definitio no f "capita l expenditure " i n th e Genera l Provision s onl yfit s case s wher e th e affecte d facilit yi s th e sam e a s th e entir e facility .



### 9- 3P. 7



### Response : Th e functio no f th e Genera l Provision s i s t o defin e term s andlis t requirement s tha t ar e commo nt o al l ne wsourc e performanc e standards . Th e standard s us e th e definitio no f "capita l expenditure " a s intende di nth e Genera l Provision s and , therefore , i t i s neithe r necessar yno r appropriat e t o redefin e tha t ter m

i nSubpar t VV . Th e definitio no f "capita l expendi

ture " i nth e Genera l Provision s use s th e ter m"existin g facility " anddoe s no t impl ythat , inth e cas e o f Subpar t VV , thi s termmean s th e entir e proces s unit , andi t i s thi s facilit yt o whic hth e capita l expenditur e criterio nwoul db e applied . Subpar t V V define s a "facility " (whic hi s eithe r anaffecte dfacilit yo r anexistin g facility ) a s th e group o f al l fugitiv e emissio nsource s withi na SOCM I unit . Thus , th e Genera l Provision s definitio no f "capita l expenditure " fit s th e cas e o f fugitiv e emissio n source s withi nSOCMI . Acommen t relate dt o thi s on e concernin g capita l availabilit yi s presente di nSectio n7.3 . 9. 2 EMISSIO NCRITERI AFORMODIFICATIO N Comment : EP Awa s urge di nthre e set s o f comment s (IV-D-7 ; IV-D-17 ; IV-F-1 , No.l , p.12 ) t o conside r a nallowanc e fo r a d e minimi s emission s increas e criterio n i nit s revision s o f th e propose dregulations . I t wa s suggeste dtha t i t woul db e reasonabl e t o exemp t source s increasin g emission s b y10-2 0 ton s pe r yea r fro mcoverag e unde r th e modificatio nprovisions . Th e 10-2 0 ton s pe r yea r cutof f wa s sai dt o b e supporte dbydat a containe di na nEP Acontracto r study : Impac t o f Propose dandAlternativ e D e Minimi s Level s fo r Criteri a Pollutants , June , 1980 . One

- commente r recommende dsettin g th e cutof f a t eithe r 1 0 ton s pe r yea r o r 1 0 percen t o f th e baselin e emissions , whicheve r i s greater . I non e o f the . set s o f comment s (IV-D-17 ) furthe r argument s fo r establishin g a nemissio nincreas e criterio nwer e given . PS D andnonattain

- 2J%M men t review s fo r permit s wer e sai dt o provid e ampl e opportunit yfo r __%§_ stringen t contro l o f modifie dsources . Accordin g t o th e comment , al l ne t increase s i nemission s fro mexistin g majo r source s mus t b e accumulated . Then , whe na 4 0 ton s pe r yea r leve l i s reached , a revie wfo r a permi t i s required . Th e commente r continued , sayin g tha t eithe r BAC T o r LAE Rwoul db e

9- 4 

# M
•mrequire d o n th e las t change d uni t triggerin g review . Thi s commente r and

anothe r commente r (IV-D-15 ) basicall yrequeste d tha t EP Aconside r an amission s increas e criterio na s a possibl e solutio nt o th e proble mo f coverin g plant s makin g smal l changes . Response : Unde r th e definitio ni nSectio n111(a)(4) , anyphysica l o r operationa l chang e resultin g i na nincreas e i nemission s constitute s a "modification. " EPAha s exempte d certai nsmal l emission s increase s fro mconsideratio ni n decidin g whethe r ther e ha s bee na nincreas e i nemission s constitutin g a "modification " fo r purpose s o f PS D applicabilit y(4 0 CF R52.21(b)(2 ) and (b)(231)) . Thi s actio nfollowe d th e decisio ni nAlabam a Powe r Co . v . Costle , 63 5 F.2 d 32 3 (D.C . Cir . 1979) , i nwhic hth e D.C . Circui t hel d tha t EPAha s authorit yt o interpre t th e definitio no f "modification " s o a s t o exemp t source s wit hsmal l emission s increase s fro mPS D revie wo nground s o f administrativ e necessit y(Id . a t 400) . A s explaine d i na previou s response , th e Alabam a Powe r decisio ndoe s no t requir e EP At o provid e a d e minimi s exemptio nfro mapplicatio no f th e "modification " definitio nfo r NSP S applicabilit ypurposes . No r ha s EPA' s experienc e i n implementin g th e NSP S progra msuggeste d a nadministrativ e nee d fo r relievin g existin g source s fro mNSP S applicabilit ywhe nthe yunderg o change s resultin g i n onl ya smal l increas e i nemissions . Thi s differ s somewha t fro mEPA' s implementatio no f th e definitio no f "modification " fo r ^S D applicabilit ypurposes . I ntha t area , th e Agenc yha s determine d tha t th e administrativ e burde no f applyin g th e ful l preconstructic nrevie w proces s t o a sourc e wit honl ya smal l emission s increas e ma yb e unreasonabl e (4 5 Federa l Registe r 5270 5 (Aug . 7 , 1980)) . Th e administrativ e burde n associate d wit hth e NSP S program , however , i s relativel yminimal . I n contras t t o PS D requirements , NSPS' s ar e categoricall yapplicabl e technology-base d reguirement s only ; the yd o no t involv e a nassessmen t o f ambien t effect s an d d o no t requir e case-by-cas e review . Furthermore , EP Abelieve s tha t th e curren t straightforwar d applicatio n o f th e "modification " definitio nfo r NSP S purpose s bes t serve s Sectio nIll' s intent . On e ke ypurpos e o f th e NSP S progra mi s t o preven t ne wpollutio n



### 9- 5P. 9

problem s fro marising . On e wa ytha t th e statut e seek s t o achiev e thi s i s b y requirin g applicatio n o f th e bes t demonstrate d tecnnolog yat , an d thereby minimizin g emission s from , existin g facilitie s wit hincrease d emissions . Th e curren t NSP S approac ho f no t providin g a nexemptio nfro mth e "modifica

tion " provisio nbase d o nth e siz e o f th e emission s source s ar e no t intende d t o cove r existin g plant s makin g routin e and mino r additions . Th e "modifica

tion i : provision s i n th e Genera l Provision s o f 4 0 CF RPar t 6 0 exemp t change s suc ha s addition s mad e t o increas e productio nrat e (i f the yca nb e accom plishe d withou t capita l expenditure , a s define d i nth e Genera l Provisions ) and routin e replacement s (4 0 CF R60.14(e)) . I naddition , thes e standard s woul d exemp : addition s mad e fo r proces s improvement s i f the yar e mad e withou t incurrin g a capita l expenditure . 9. 3 AFFECTE D FACILIT YDEFINITIO NFORMODIFIE D SOURCE S Comment : On e commente r (IV-D-15 ) wa s concerne d tha t th e financia l guideline s provide d b

yEP At o defin e a capita l expenditur e coul d resul t i ninappro

priat e applicatio no f performanc e standards . Th e commente r though t thi s migh t especiall yb e a proble mfo r smal l productio nfacilitie s wit hlimite d assets . H e cite d a nexample . I f a distillatio ncolumnwer e adde d t o a n existin g unit , th e entir e unit , and al l associate d equipmen t woul d b e subjec t t o th e NSPS . Th e situatio nappeare d unreasonabl e t o hi mi nvie wo f th e fac t tha t th e fugitiv e emission s source s associate d wit hth e ne wcolumnwoul d contribut e onl ya smal l incrementa l increas e i nth e overal l VO C emission s fro m th e unit . H e furthe r commente d tha t upgradin g an d retrofittin g al l th e fugitiv e emissio n source s withi nth e uni t woul d substantiall yincreas e th e capita l require d fo r th e projec t and coul d possibl yresul t i nabandonin g i t altogether. A s a solution , th e commente r suggeste d limitin g th e scop e o f th e affecte d facilit yt o individua l equipmen t bein g adde d o r replace d fo r modifie d facilities . H e offere d anothe r alternative : a nemission s increas e criterio n (se e Sectio n9.2) . Response : Th e Clea n Ai r Ac t require s tha t standard s o f performanc e b e applie d t o existin g source s whic hincreas e emissions . EPAha s carefull yanalyze d th e 

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### 9- 6P.1 0

modificatio n and reconstructio nprovision s whic hmigh t appl yt o existin g SOCM I units . Th e Agenc yha s conclude d tha t th e provision s offe r sufficien t flexibilit yfo r continue d productiv e operatio nand reasonabl e protectio n agains t inappropriat e coverag e o f existin g facilitie s withi nth e contex t o f th e Clea n Ai r Act . I ndevelopin g th e standards , EP Aconsidere d retrofi t cost s whic hwoul d b e incurre d i f anexistin g uni t wer e covere d unde r modifi

catio n provisions . I nselectin g th e fina l standards , EP Aselecte d standard s base d o ncost-effectivenes s considerations . Furthermore , th e economi c analysi s fo r thi s regulatio nshowe d n o capita l availabilit yproblem , no r di d i t sho wanyunreasonabl e economi c impact. ' The commenter' s exampl e and interpretatio no f the modificatio nand reconstructio nprovision s whic hwoul d appl yshow s som e confusio nabou t th e provision s themselve s an d th e affecte d facilit yt o whic hthe yapply . Becaus e th e determinatio no f a capita l expenditur e i s base d o na percentag e o f th e purchas e pric e o f th e existin g facility , smal l and larg e productio n facilitie s shoul d b e affecte d equally . Th e commente r ma yb e referrin g t o a productio n facilit yowne d b ya smal l busines s instea d o f a smal l productio n facility . Still , a s showni nSectio n7.3 , th e economi c analysi s showe d n o advers e impac t o nsmal l businesses . Furthermore , the affecte d facilit yt o whic hth e standard s appl yi s th e group o f al l fugitiv e emissio nsource s (pumps , compressors , samplin g connections , safety/relie f valve s an d open-ende d lines ) withi na proces s unit . I f a ne wdistillatio ncolumnwer e adde d t o anexistin g proces s unit , th e cos t basi s use d t o determin e whethe r a capita l expenditur e ha d bee nmad e i s th e cos t o f th e adde d fugitiv e emissio nsource s compare d t o th e cos t o f th e existin g fugitiv e emissio nsources . The cos t basi s doe s no t includ e th e cos t o f th e columno r th e entir e proces s unit . Th e existin g modificatio nprovision s i n4 0 CF R60.1 4 and th e proces s improvemen t exemptio ni nth e SOCM I standard s preven t smal l increase s i n emission s du e t o routin e activitie s fro mcausin g modificatio nt o occur . Finally , i t i s importan t t o not e tha t t o b e considere d a modification , a chang e mad e mus t increas e emission s fro mth e existin g facility . I f a chang e i s mad e tha t woul d increas e emissions , but-tha t potentia l emission s increas e



### 9-7P.1 1

i s offse t s o ther e i s n o ne t increase , the nth e chang e i s no t considere da mod i fication . Th e preambl e t o the propose dregulatio n(4 0 CF R1136 , Januar y 5 , 1981 ) explaine dtha t the commenter' s suggestio no f limitin gth e scop e o f th e affecte dfacilit y

t o th e individua l equipmen t bein gadde do r replace dwa s considered . However , suc ha designatio nwoul dmea ntha t replace dequipmen t component s inexistin gunit s woul dbe subjec t t o th e new sourc e standards , whil e adjacen t component s woul dno t be subjec t t o th e standards . Deter minin gwhic hcomponent s wer e subjec t t o th e requirement s o f the standar d woul dbe impracticabl e fo r th e owner/operato r an dfo r EPA . Therefore , the individua l equipmen t definitio nwa s no t selecte dfo r th e affecte dfacility . Th e commenter' s suggestio no f a nemission s increas e criterio nwa s als o considere da t proposal . Thi s issu e i s discusse di nSectio n9.2 . 9. 4 TECHNICA L PROBLEM S WIT HRETROFI T Comment : On e commente r (IV-D-24 ) wrot e tha t some existin gSOCM I plant s migh t b e subjec t t o th e rul e b y virtu e o f modificatio no r reconstruction . Inthes e case s a nenclose dcombustio ndevic e woul db e required . Fo r safet y reasons , th e combustion , devic e shoul dbe locate da t a distanc e from th e proces s area . However , th e commente r sai dther e migh t no t be enoug hspac e t o instal l a combustio ndevic e i nanappropriat e location . Fo r thi s reason , h e sai d modifie dan

dreconstructe dfacilitie s shoul db e relieve do f th e requiremen t t o instal l a combustio ndevice . Anothe r commente r (IV-D-15 ) cite dth e same proble m o f spac e limitations . H e sai dexistin gplant s ofte nwoul dno t hav e roo m fo r barrie r flui dsystem s andcombustio ndevices . H e adde dtha t locatin gthes e piece s o f equipmen t a t a distanc e fro m pump s andcompressor s woul dincreas e constructio nan

doperatin gcost s b

y requirin gmor e pipin gt o interconnec t th e system s an

dincreasin gthe energy cost s t o ru

nth e system . Response : Regardles s o f whethe r a uni t i s a new o r existin gunit , EP A expect s tha t a nexistin gcontro l devic e wil l be used . Th e contro l devic e nee dno t be a combustio ndevice . Furthermore , sinc e proposal , some o f the provision s



### 9- 8P.1 2

whic hwoul d hav e require d a contro l devic e hav e bee nchanged . Th e change s effectivel ymea ntha t a contro l devic e i s no t necessaril yrequired ; i nfact , mos t unit s wil l no t requir e a contro l device . Th e propose d standard s require d tha t pump s and compressor s b e controlle d wit ha barrie r fluid/dua l sea l system . Th e ven t stream s fro m thi s syste mwer e t o b e destroye d i na nenclose d combustio ndevic e o r 9 5 percen t efficienc yvapo r recover ysystem . However , th e fina l standard s allo wa nowne r o r operato r o f a naffecte d facilit yt o choos e amon g severa l method s fo r complianc e wit hth e fina l standard s fo r pump s and compressors . First , th e fina l standard s fo r pump s d o ho t requir e a contro l device . A n owner/operato r ma ychoos e t o compl ywit ha wor k practic e standar d fo r pump s instea d o f th e equipmen t standar d a s originall yproposed . Th e wor k practic e standar d eliminate s th e nee d fo r a contro l device . Th e standard s allo wven ; stream s fro m

pum p and compresso r barrie r flui d system s t o b e controlle d b y •Hares , enclose d combustio ndevices , o r anyothe r contro l devic e designe d and operate d fo r 9 5 percen t efficiency . Th e provisio nfo r allowin g flare s mean s tha t i f a contro l devic e i s required , additiona l pption s ar e availabl e t o th e owne r o r operator . Th e provisio nfo r allowin g flare s als o mean s tha t a contro l devic e wil l mos t assuredl yb e presen t i nal l SOCM I proces s units . A s discusse d i nSectio n4.1 , smokeles s flare s ar e onl yallowe d i f the yar e operate d withi ncertai nexi t velocit yan d ga s hea t conten t criteria . Anothe r chang e i nth e standard s wa s mad e specificall yt o avoi d retrofi t problem s wit hexistin g compressors . I f a nexistin g compresso r become s subjec t t o th e rule s byvirtu e o f modificatio nan d reconstructio nan d i t canno t b e vente d becaus e vent s canno t b e provide d i nth e existin g hardwar e surroundin g th e sea l area , i t i s exemp t fro mcomplyin g wit hth e compresso r standards . Thi s provisio ni s discusse d mor e full yi nSectio n4.12 . Comment : On e commente r (IV-D-15 ) gav e anothe r exampl e o f a retrofi t proble mwit h ruptur e disks . H e sai d th e increase d bul k and weigh t o f th e ne wpressur e contro l syste mma yexcee d th e stres s limit s o f existin g towe r weld s and connections . Increasin g th e strengt ho f thes e ne wconnection s woul d b e costl yand woul d requir e additiona l downtim e fo r installation .



### 9- 9P.1 3



### Anothe r commente r (IV-D-2 ) offere dsome solution s t o retrofi t problem s fo r pressur e relie f devices . H e sai di f a combinatio nrupture-disc/relie f valve tha t hadbeenflow-teste db y th e Nationa l Boar do f th e ASM E cod e wer e selected , a large r relie f devic e woul dno t b e required . H e als o offere da solutio nt o th e problem o f havin gfixe dpipin gupstream anddownstream

o f the relie f device . Thi s situatio nprevent s th e devic e fro m bein gmove du

p severa l inche s t o allow spac e fo r a ruptur e disc . H e recommende da ruptur e dis c welde dint o a flang e tha t fit s dow ninthe pipin gandha s onl y a minima l heigh t o f 1/ 8 t o 1/ 4 inch . Th e pric e o f th e welde ddis kandholde r i s abou t hal f the pric e o f a standar ddis kandholder . Response : Th e standard s d o no t requir e ruptur e disk s a s a contro l device . Th e standard s requir e "no detectabl e emissions " (define da s no highe r a concen tratio nthan50 0 ppm

v measure db

y a portabl e VO C monitor ) from safety/relie f valve s excep t durin gemergenc y venting . Thi s standar dma y b e me t inan

y wa y whic hresult s i nno detectabl e emissions . Two ways , fo r example , woul dbe b y usin gruptur e disk s o r b y pipingt o a flar e header . I f ruptur e disk s ar e chose na s th e metho do f control , ther e ar e some new method s fo r overcomin g some o f th e retrofi t problem s a s describe db y th e commente r inIV-D-2 . Th e problem

pose db y th e commente r regardin gstrengthenin gtowe r weld s woul db e anunusua l circumstanc e from a nengineerin gpoin t o f view . However , i f bracin go r supportin gi s required , i t canb e don e whil e the unit , i s undergoin gmodificatio no r reconstruction . N o additiona l downtime woul d be required . EPA

recognize s tha t i nretrofi t situation s mor e complicate d installatio nprocedure s ma y b e required . Thes e expecte dcomplication s hav e bee naccounte dfo r i nretrofi t installatio ncost s whic har e highe r than cost s fo r new

installations . 9. 5 CAPITAL EXPENDITUR E CRITERIO N Comment : On e commente r (IV-D-7 ) describe dsom e problem s wit hth e capita l expenditur e criterio napplie dt o determin e modifications . H e sai dsucha criterio nwoul dbe difficul t t o administer . H e commente dtha t a company' s record s ma y

no t b e detaile denought o reflec t th e cos t basi s unde r Interna l ' Vi aV.f * « 

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V3 5 

### 9-1 0P.1 4

Revenu e Cod e 1012 . A neve nbigge r complicatio nwa s see ni nth e fac t tha t th e concep t o f "annua l asse t guidelin e repai r allowanc e percentage " i s a par t o f th e Asse t Depreciatio nRang e Syste m(ADR ) unde r th e Interna l Revenu e Code . Accordin g t o th e commenter , Presiden t Reagan' s ta xproposal s woul d repea l th e AD Rfo r propert yplace d i nservic e i n198 1 and late r years . Othe r proposal s woul d mak e th e AD Roptional . However , unde r anyo f th e ne w proposals , a companywoul d hav e t o maintai nadditiona l record s fo r post-198 0 assets , solel yfo r th e purpos e o f th e propose d regulation . Response : Thi s commen t describe s tw o possibl e problem s wit husin g a capita l investmen t criterio n t o determin e exemption s fro mth e standard s fo r routin e replacemen t an d addition s mad e t o increas e th e productio nrate . Th e firs t proble mi s tha t a companyma yno t hav e kep t accountin g record s tha t ar e i n sufficien t detai l t o reflec t th e cos t basi s o f th e existin g facility . Thi s cos t i s necessar yt o determin e i f a particula r expenditur e constitute s a capita l investment . I t i s tru e tha t thi s difficult yma yb e a large r proble m fo r th e SOCM I fugitiv e VO C regulatio ntha nfo r manyothe r ne wsourc e stan
dards . Th e difficult yarise s i nth e fac t tha t th e affecte d facilit yi s th e grou p o f fugitiv e emissio nsource s withi nth e proces s uni t rathe r tha nth e entir e uni t s o tha t th e tota l cos t i s compose d o f man ysmal l cos t items . However , ther e ar e way s t o handl e thi s problem . Fo r example , on e wa yt o estimat e th e cos t o f emissio nsource s woul d b e t o prorat e costs , base d o n th e presen t rati o o f fugitiv e emissio nsourc e cost s t o tota l costs . Th e us e o f replacemen t cost s wit hanappropriat e adjustmen t t o reflec t origina l cost s woul d b e considere d b yEPA . Therefore , becaus e estimatio nmethod s ca n provid e a sufficientl yaccurat e cos t estimat e o f th e existin g sources , EPA see s no reaso nt o mak e th e suggeste d change . Th e secon d proble mdiscusse d i nthi s commen t wit hth e capita l invest

men t criterio ni s th e ta xrefor mwhic hchange s th e depreciatio nrule s fo r ne wfacilitie s . Th e annua l asse t guidelin e repai r allowanc e percentage , reference d byth e Genera l Provision s (4 0 CF R60.2 ) fo r th e purpos e o f definin g a capita l investmen t remain s i neffec t fo r existin g units . I t wa s include d i n IR S Publicatio n53 4 fo r 198 1 ta xreturns . Existin g unit s ca n

9-1 1stil l us e the allowabl e percentag e fo r determinatio no f whethe r a capita l

expenditur e ha s occurred . SOCM I unit s buil t inthe futur e wil l us e the accelerate ddepreciatio n system fo r whic hther e i s no allowabl e repai r percentage ; however , they wil l b e covere db

y th e standard s inan y case . EPA

i s currentl y

considerin g change s t o th e Genera l Provision s whic hwoul dsolv e th e potentia l problem s whic hwoul daris e wit hfacilitie s whic hwoul dbecome subjec t t o NSP S i n futur e years . Comment : Anothe r commen t lette r (IV-D-17 ) state dtha t th e commenter' s understandin gwa s tha t proces s improvement s costin gu pt o 12. 5 percen t annuall y o f th e origina l investmen t woul dno t b y themselve s b e considere da modification . Response : Th e commenter' s statemen t i s correc t wit hsome qualifications . Th e figur e o f 12. 5 percen t o f th e origina l investmen t fo r fugitiv e emission s source s represent s the maximu m expenditur e tha t coul db e mad e annuall y fo r routin e replacemen t an dmino r addition s withou t triggerin gapplicatio no f the modificatio nprovisions . Th e calculatio no f thi s limi t i s explaine dinth e definitio n"capita l expenditure " in4 0 CFR60.2 . I t i s the produc t o f th e applicabl e "annua l asse t guidelin e repai r allowanc e percentage " specifie dinthe lates t editio n o f Interna l Revenu e Servic e (IRS ) Publicatio n53 4 andth e existin g^ facility' s basis . Fo r 198 0 an d1981 , th e annua l asse t guidelin e repai r 5 percentag e wa s 12. 5 percent ; however , thi s i s subjec t t o chang e annually . i| | I n1979 , fo r example , th e repai r percentag e wa s 5.5 . .^J g I t i s importan t t o not e tha t a nincreas e inemission s i s th e primar y tes t fo r determinin gi f some physica l o r operationa l chang e t o a nexistin g facilit y constitute s a modification . Moreover , change s mad e fo r proces s improvement s [an

dothe r change s a s describe din4 0 CFR60.14(e) ] whic h increas e emission s woul dno t b e considere da modificatio ni f th e capita l expenditur e limi t ha s no t bee nexceeded . Fo r example , a nowne r o r operato r migh t ad

da contro l loopconsistin go f abou t 5-1 0 valve s fo r purpose s o f

9-1 2P.1 6

improve d proces s efficiency . I f th e cos t o f thes e valve s di d no t excee d th e 12. 5 percen t allowanc e o f th e origina l fugitiv e emissio nsourc e costs , th e chang e woul d no t b e considere d a modification . Comment : On e commente r (IV-D-34 ) agree d wit hEPA' s expressio ntha t "NSP S fo r SOCM I source s ar e no t intende d t o cove r existin g plant s makin g routin e and minor additions. " H e furthe r agree d tha t exemption s shoul d appl yfo r routin e replacemen t and fo r addition s mad e fo r productio nrat e increase s i f suc hincrease s ca n b e accomplishe d withou t capita l expenditures . Response : Th e provision s fo r exemptin g productio nrat e increase s mad e withou t capita l expenditure s ma yb e foun d i n4 0 CF R60 , Subpar t A . Comment : Anothe r commente r (IV-D-26 ) favore d allowin g capita l expenditure s i f ther e wer e n o emission s increase . H e sai d tha t eliminatin g th e capita l expenditur e criterio n woul d allo wupdatin g o f existin g facilitie s whil e limitin g VO C emissions . Unles s som e provisio ni s mad e fo r capita l expenditures , h e added , olde r existin g plant s ma yno t b e upgrade d int o mor e efficien t facilitie s whic hincorporat e curren t technologies . Response : Capita l expenditure s ar e allowe d t o som e exten t under modificatio nan d reconstructio n provisions . Existin g facilitie s ma yspen d up t o 5 0 percen t o f th e cos t o f a comparabl e ne wfacilit yan d no t b e covere d byth e standard s i f emission s ar e no t increased . However , i f emission s ar e increase d aji d a capita l expenditur e i s mad e (i.e. , i s greate r tha nth e produc t o f th e applicabl e annua l asse t guidelin e repai r allowanc e percentag e an d th e existin g facility' s basis) , the nth e facilit ybecome s a modifie d facility . Th e inten t o f th e Modificatio nan d Reconstructio nProvision s i s discusse d i n a previou s commen t i n Sectio n9.1 . 9. 6 COVERAG E O F RECONSTRUCTION S Comment : On e se t o f comment s (IV-D-17 ) sai d tha t EP Ashoul d revis e 4 0 CF R 60.1 5 t o limi t th e applicabilit yo f th e propose d NSP S requirement s t o

9-1 3P.1 7

reconstructions . Reconstruction s ar e essentiall y mor e comprehensiv e modification s andt o be consisten t wit hth e definitio no f modification , shoul dno t be subjec t t o NSP S unles s ther e i s a nincreas e inne t emission s a t the proces s unit . Th e commen t cite da brief , file db y th e stee l industr y i nnonattainmen t litigation , whic hdemonstrate s tha t th e Clea nAi r Ac t woul d no t requir e applicatio no f NSP S t o reconstruction s wher e n o emissio n increase s occur . Th e commen t sai dthat , inapparen t recognitio no f th e reasonablenes s an

dlega l suppor t fo r industry' s position , EPA propose dt o exclud e reconstruction s fro m nonattainmen t are a new sourc e review •'4 o ^ R16280) . Thi s argumen t continue dtha t i t i s completel y withi nEPA' s ---.-.orit

y t o limi t th e applicabilit y fo r reconstructio no f existin g facilitie s fro

m an y new sourc e review

requirements . Th e commen t sai dthis chang e woul doffe r th e benefi t o f permittin gful l us e o f th e bubbl e concep t a t th e proces s uni t withou t an y undu e restriction s base do nai r quality . Anothe r commente r (IV-D-48 ) wrot e tha t th e definitio no f "reconstruc tion " a t 4 0 CF R60.15(b ) i s ambiguou s inligh t o f th e statemen t o f applicabilit y

o f 4 0 CFR60.480(a ) an dth e definitio no f "proces s unit " a t 4 0 CFR60.481 . H e argue dthat , a s thes e definition s ar e writte ninth e proposal , i t i s possibl e fo r a facility , ove r a perio do f years , t o reac hth e 5 0 percen t o f capita l cos t o f constructio no f a new facilit y

an dthu s become a

naffecte d facility . Accordingly , th e definitio no f "reconstruction " a t 4 0 CF R15(b)(1 ) i s inadequat e an dshoul db e amende dt o preven t thi s occurrence . Th e commente r propose dtha t on e o r mor e o f th e followin g suggestion s be implemente dt o accomplis hthis amendment : (1 ) Provid e fo r a specifie dtime limi t durin gwhic haccrua l o f capita l expenditure s shoul doccur . Thi s time limi t woul dhav e t o b e o f sufficien t duration , e.g. , tw o years , t o preven t stretchin gsuc h repair s t o avoi dcoverage .

9-1 4P.1 8

(2 ) Amen d th e definitio nt o provid e that , fo r purpose s o f determinin g whethe r o r no t th e 5 0 percen t tes t i s met , th e cos t o f equipmen t whic hi s accrue d b e a singl e piec e o f proces s equipmen t and directl yrelate d suppor t equipment , e.g. . pumps . Wher e suc h suppor t equipmen t i s share d i ncommo nb ytw o o r mor e piece s o f proces s equipment , th e capita l replacemen t cos t o f th e suppor t piec e coul d b e apportione d eithe r equall yo r accordin g t o pr o rat a usag e amon g th e variou s piece s o f proces s equipmen t served . (3 ) Amen d th e definitio nt o provid e tha t a repai r qualifie s a s a reconstructio n onl ywher e ther e i s a ne t increas e i nemission s fro mth e proces s unit . Thi s thir d approac hwa s sai d t o be , b yfar , th e mos t desirabl e approac h •since i t provide s a measur e o f pollutio ncontro l whic hi s unaffecte d b y externa l forces , suc ha s inflation . Response : Sinc e i n enactin g Sectio n11 1 Congres s di d no t defin e th e ter m "construction, " th e questio naros e whethe r NSP S woul d appl yt o facilitie s bein g rebuilt . Noncoverag e o f suc hfacilitie s woul d hav e produce d th e incongruit ytha t NSP S woul d appl yt o completel yne wfacilities , bu t no t t o facilitie s tha t wer e essentiall yne wbecaus e the yha d undergon e reconstruc
tio n o f muc ho f thei r componen t equipment . Thi s woul d hav e undermine d Congress' s inten t unde r Sectio n11 1 t o requir e stric t contro l o f emission s a s th e Nation' s industria l bas e i s replaced . EP Apromulgate d th e reconstructio nprovision s i n1975 , afte r notic e and opportunit yfo r publi c commen t (4 0 F R58420 , Decembe r 16 , 1975) , t o fulfil l thi s inten t o f Congress . Sinc e thi s turnove r i nthe industria l bas e ma y occu r independentl yo f whethe r emission s fro mth e rebuil t source s hav e increased , th e reconstructio nprovision s d o no t focu s o nwhethe r th e change s tha t rende r a sourc e essentiall yne wals o resul t i nincrease d emissions . Congres s di d no t attemp t t o overrul e EPA' s previou s promulgatio nof Sectio n60.1 5 i n passin g th e Clea nAi r Ac t Amendment s o f 1977 . Thi s indicate s tha t Congres s viewe d th e reconstructio nprovisions ' focu s o n componen t replacement , rathe r tha nemission s level , a s consisten t wit h

9-1 5P.1 9

Sectio n ill . See , e.g. , Re d Lio nBroadcastin g Co . v . FCC , 39 5 U.S . 36 7 (1969) ; NLR B v . Bel l Aerospac e Division , 41 6 U.S . 26 7 (1974) . No r ha s an y

. Cour t questione d th e Agency' s authorit yt o subjec t reconstructe d source s t o ne wsourc e performanc e standards . Infact , i nASARC o v . EPA , 57 8 F.2 d 319 , 32 8 n.3 1 (D.C . Cir . 1978) , th e D.C . Circui t suggeste d tha t th e reconstructe d provision s ma yno t g o fa r enoug htowar d preventin g possibl e abuse s b yowner s seekin g t o avoi d NSP S b yperpetuatin g th e usefu l live s o f thei r existin g facilitie s indefinitely . Failur e t o cover facilitie s tha t hav e undergon e extensiv e componen t replacemen t ove r a lon g perio d o f tim e similarl ypost
pone s th e enhancemen t o f ai r qualit yCongres s sough t under Sectio n111 . Th e D.C . Circui t recognize d thi s whe ni t expressed ' concer ni nth e ASARC o cas e that , absen t a provisio nfo r aggregatin g replacemen t expenditure s "ove r th e years, " owner s coul d evad e th e reconstructio nprovision s b ycontinuall y replacin g obsolet e o r worn-ou t equipment , [57 8 F.2 d 319 , 32 8 n.3 1 (D.C . Cir . 1978)] . Sectio n60.1 5 currentl ydefine s "reconstruction " a s th e replacemen t o f component s o f a nexistin g facilit yt o suc ha nexten t tha t "th e fixe d capita l cos t o f th e ne wcomponents " exceed s 5 0 percen t o f th e "fixe d capita l cost " tha t woul d b e require d t o construc t a comparabl e entirel yne wfacilit yan d EPAdetermine s tha t i t i s technologicall yan d economicall yfeasibl e t o mee t th e applicabl e NSPS . Subsectio n(d ) indicate s tha t th e "ne wcomponents " whos e cos t woul d b e counte d towar d th e 5 0 percen t threshol d includ e thos e component s th e owner "propose s t o replace. " I t i s unclea r under thi s wordin g whethe r a reconstructio nha s occurre d i nth e cas e o f a nowne r wh o firs t seek s t o replac e component s o f a nexistin g facilit ya s a cos t equa l t o 3 0 percen t o f th e cos t o f a nentirel yne wfacilit yan d then , shortl yafte r commencin g o r completin g thos e replacements , seek s t o replac e anadditiona l 3 0 percent . Specifically , i t i s uncertai nwhethe r th e owne r shoul d b e deeme d t o hav e mad e tw o distinc t proposals , o r instea d a singl e proposal . I f EP Awoul d tak e th e forme r view , owner s coul d avoi d NSP S coverag e under Sectio n 60.1 5 simpl yb ycharacterizin g thei r replacemen t project s a s distinc t proposals , eve nwher e th e componen t replacemen t i s complete d withi n a relativel yshor t perio d o f time . -T ^ t-'-lti

9-1 6EPAdi d no t intend , i n promulgatin g th e reconstructio nprovisions , tha t

th e term"propose " exclud e fro mNSP S coverag e facilitie s undergoin g thi s typ e o f extensiv e componen t replacement . Failur e t o cover thes e source s serve s t o undermin e Congress' s inten t tha t ai r qualit yb e enhance d ove r th e lon g ter mbyapplyin g bes t demonstrate d technolog ywit hth e turnove r i nth e Nation' s industria l base . T o eliminat e th e ambiguit yi nth e curren t wordin g o f Sectio n60.1 5 and t o furthe r th e inten t underlyin g Sectio n11 1 (a s describe d above) , th e Administrato r i s interpretin g propose d replacemen t component s t o includ e al l replacement s whic har e require d byprogram s o f constructio no f alteratio n whic hcommenc e (bu t ar e no t necessaril ycompleted ) durin g any2-yea r perio d fo r determination s o f reconstruction . State d differently , th e Agenc ywil l coun t towar d th e 5 0 percen t reconstructio nthreshol d th e fixe d capita l cos t o f al l depreciabl e component s (excep t thos e describe d belo wand elsewher e i n thi s document ) require d fo r replacemen t i nal l continuou s program s o f reconstructio n whic hcommenc e withi nan y2-yea r perio d followin g Decembe r 17 , 1980 . I nth e Administrator' s judgment , th e 2-yea r perio d provide s fo r thi s industr ya reasonable , objectiv e metho d o f determinin g whethe r a nowne r i s actuall yproposin g extensiv e componen t replacement , withi n th e Agency' s origina l inten t i npromulgatin g Sectio n60.15 . Th e Administrato r mus t decid e o na case-by-cas e basi s i f propose d replacement s constitut e reconstruction . Thi s decisio ni s base d o nth e following : (l ) fixe d capita l cos t o f replacemen t an d estimate d lif e o f th e facilit yafter replacemen t compare d t o th e cos t an d lif e o f a comparabl e entirel yne wfacility , (2 ) th e exten t t o whic hth e component s bein g replace d caus e o r contribut e t o emission s fro mth e facility , an d (3 ) economi c o r technica l limitation s o ncomplianc e inheren t i nth e propose d replacements . Th e brief an d th e Federa l Reoiste r notic e cite d i non e o f th e comment s

• — • • i i • •!• ! m •••»—•• • — i — i bot hdea l wit hnonattainmen t provision s rathe r tha nNSPS . Th e Federa l Registe r citatio n(4 6 FR16280 , Marc h12 , 1981 ) propose d t o standardiz e th e definition s o f "source " fo r ne wsourc e revie wi nattainmen t an d nonattain

men t areas . Airpn

g othe r changes , th e proposa l seek s t o dro p th e requiremen t tha t reconstruction s b e subjec t t o nonattainmen t ne wsourc e review .

9-1 7P.2 1

- I



### However , a s par t o f th e rational e fo r droppin g reconstruction s ^ro m~ni s review , EP Astate dtha t NSP S woul dassur e th e us e o f th e mos t uo-to-dat e pollutio ncontro l techniques , regardles s o f th e applicabilit yo f nonattain

men t are a ne wsourc e review . Thus , i t i s consisten t wit hth e brie f andth e Federa l Reaiste r notic e t o continu e reconstructio na s i s fo r thes e standards .

9-1 8