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2010 ~.PR -7 PM 12: 46

TEXAS COMMISSION ON ENVIRONMENTAL QuAlflIn'filVISION

Bryan W. Shaw, Ph.D., Chairman

Buddy Garcia, Commissioner

Carlos Rubinstein, Commissioner

Mark R. Vickery, P.G., Executive Director

Protecting Texas by Reducing andPreventing Pollution

April 1,2010

Docket No. 2009-0801-SIP

Project No. 2009-018-SIP-NR

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Alfredo "AI" Armendariz, Ph.D., Regional Administrator

U.S. Environmental Protection Agency - Region 6

1445 Ross Avenue

Dallas, Texas 75202-2733

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Dear Dr. Armendariz:

On March 10,2010, the Texas Commission on Environinental Quality (Commission) adopted a revision to the

state implementation plan (SIP) for demonstration of reasonable further progress for the Houston-GalvestonBrazoria (HGB) 1997 eight-hour ozone nonattainment area.

The Commission adopted the HGB Reasonable Further Progress (RFP) SIP revision, demonstrating that the

RFP emissions reduction requirement will be met for the six-year period (2003-2008) beginning Janumy 1 ofthe

year following the year used for the baseline emissions inventory (2002) and all remaining three-year periods

after the first six-year period (2009-2011, 2012-2014, and 2015-2017) out to the area's attainment date (2019).

This SIP revision also sets the nitrogen oxides (NOx) and volatile organic compounds (VOC) motor vehicle

emissions budgets (MVEB) for transportation conformity purposes for the milestone years 2008, 2011, 2014,

2017, and 2018.

Enclosed are the proposed revision to the SIP, a public hearing certification, a complete record of the public

hearings, and the accompanying order. I look forward to your expeditious approval ofthis SIP revision.

Sincerely,

~~;dAtv- Bryan W. Shaw, Ph.D.

Chairman

BWS/ts

Enclosures

cc: The Honorable Rick Perry, Governor ofTexas

Mr. Toby Baker, Office ofBudget, Planning and Policy, Office ofthe Governor

.Mr. MarkR. Vickery, P.G., Executive Director, Texas Commission on Environmental Quality

P.O. Box 13087 Austin, Texas 78711-3087 512-239-1000 Internet address:www.tceq.state.tx.us

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Texas Commission on Environmental Quality

Public Hearings

October 28 and 29. 2009

Concerning Revisions to the

HGB Eight-Hour Ozone Reasonable Further Progress SIP

Project No. 2009-018-SIP-NR
REVISION TO THE STATE IMPLEMENTATION PLAN FOR 

THE CONTROL OF OZONE AIR POLLUTION 

HOUSTON-GALVESTON-BRAZORIA 1997 EIGHT-HOUR 

OZONE STANDARD NONATTAINMENT AREA 

TCEQ 

TEXAS COMMISSION ON ENVIRONMENTAL QUALITY 

P.O. BOX 13087 

AUSTIN, TEXAS 78711-3087 

Houston-Galveston-Brazoria Reasonable Further Progress State 

Implementation Plan Revision for the1997 Eight-Hour Ozone Standard 

PROJECT NO. 2009-018-SIP-NR 

Adopted 

March 10, 2010 
HGB Reasonable Further Progress SIP Revision for the 1997 Eight-Hour Ozone Standard 

ix

LIST OF APPENDICES 

Appendix Appendix Name

Appendix 1 HGB Reasonable Further Progress Demonstration Calculations Spreadsheet 

Appendix 2 Development of Reasonable Further Progress Point Source Inventories 

Appendix 3 Development of Reasonable Further Progress Area Source Inventories 

Appendix 4 Development of Reasonable Further Progress Non-Road Mobile Source 

Emissions Inventories for Source Categories in the EPA’s NONROAD 2005 

Model 

Appendix 5 Development of Reasonable Further Progress Non-Road Mobile Source 

Emissions Inventories for Airports 

Appendix 6 Development of Reasonable Further Progress Non-Road Mobile Source 

Emissions Inventories for Locomotives 

Appendix 7 Development of Reasonable Further Progress Non-Road Mobile Source 

Emissions Inventories for Commercial Marine Vessels 

Appendix 8 Development of Reasonable Further Progress Non-Road Mobile Source 

Emissions Inventories for Drilling Rigs 

Appendix 9 Houston-Galveston-Brazoria 1997 Eight-Hour Ozone Nonattainment Area 

Reasonable Further Progress On-Road Mobile Source Emissions Inventories 
APPENDIX 2 

DEVELOPMENT OF REASONABLE FURTHER PROGRESS POINT 

SOURCE INVENTORIES 
Appendix 2: POINT SOURCES 

Emissions Inventory Development 

Stationary point source emissions data are collected annually from sites that meet the reporting 

requirements of 30 Texas Administrative Code §101.10. To collect the data, the TCEQ mails 

emissions inventory questionnaires (EIQ) to all sites identified as meeting the reporting 

requirements. Companies are required to report emissions data and to provide sample 

calculations used to determine the emissions. Information characterizing the process equipment, 

the abatement units, and the emission points is also required. 

All data submitted in the EIQ are reviewed for quality assurance purposes and then stored in the 

State of Texas Air Reporting System (STARS) database. The following TCEQ web page 

contains EIQ guidance documents and other historical point source emissions of major pollutants: 

http://www.tceq.state.tx.us/implementation/air/industei/psei/psei.html. Additional information is 

available upon request from the TCEQ’s Air Quality Division. 

Updated 2002 Base Year Inventory 

The TCEQ extracted the 2002 base year inventory data from STARS on February 4, 2009. The 

extracted data included reported ozone season daily emissions of NOX and VOC from each site in 

the HGB area that submitted a 2002 EIQ and reflected revisions made on or before the extract 

date. County-level reported VOC emissions were adjusted to account for unreported VOC 

emissions discovered in the Texas Air Quality Study (TexAQS) of 2000. 

Updated Uncontrolled Milestone Year Inventories 

In developing the uncontrolled milestone year inventories, the TCEQ projected the 2002 

inventory using the following approaches: applying projection factors to 2002 emissions; 

refining the VOC emission estimates to reflect unreported emissions; and adding unused NOX

and VOC emissions credits to the projected emissions. 

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First, the TCEQ projected emissions by applying growth factors to the 2002 actual inventory. 

The Economic Growth Analysis System (EGAS) 5.0 was used to derive growth factors from the 

following data sets: the Regional Economic Modeling, Inc. (REMI) 5.5 factor set at the 

countywide level for Texas; the Moody’s Economy, Inc. factor set at the countywide level for 

Texas; and the REMI 6.0 factor set at the statewide level for Texas. To select growth factors, the 

TCEQ compared growth factors to actual growth in emissions from 2002 to 2005 for each 

contaminant and each industrial category at the county level, and selected the factors that most 

closely corresponded to historical growth. 

County-level reported VOC emissions were then revised to account for unreported VOC 

emissions discovered in the TexAQS 2000. The TexAQS 2000 measured ambient VOC 

concentrations in the Houston Ship Channel were determined to be several times greater than the 

values in the TCEQ’s emissions inventories. 

Emissions credits are emissions reductions that may return to the airshed in the future as 

companies elect to use them. To account for this potential increase in NOx and VOC emissions 

in the HGB area, emissions credits banked in the Emissions Banking and Trading (EBT) database 

as of October 2, 2008, were added to the projected inventory after the growth factors had bee

applied. 

Banked Emissions Reductions Credits (ERCs) were applied using New Source Review (NSR) 

permitting offsets. ERCs listed in the EBT database as of October 2, 2008, were applied. An 

offset ratio of 1.3:1 was applied to the banked credits and all of the banked ERCs were applied by 

the first milestone year. The ERC transactions from 2002 to 2008 were also applied. 

 

For Discrete Emissions Reduction Credits (DERCs), the credits were applied over ten years, from 

2009 to 2018. DERCs listed in the EBT database as of April 14, 2009, were applied. An offset 
ratio of 1.1 was applied to account for the 10 percent environmental contribution retirement 

obligation. Historic use has been less than one ton per day. Since DERCs are used for short-term 

emission increases, the DERC transactions between 2002 and 2008 were not applied. 

Table 1: Contributions to the Uncontrolled Inventory from Emission Reduction Credits 

NOX, tpd VOC, tpd

Banked ERCs 0.30 2.74

Banked DERCs 16.60 0.26

ERC Transactions 1.54 0.41

Updated Controlled Milestone Year Inventories 

In developing the controlled milestone year inventories, the TCEQ projected the 2005 point 

source inventory using the following approaches: applying the Mass Emissions Cap and Trade 

Program (MECT) 2008 caps to the projected NOX emissions, applying the Highly Reactive VOC 

Cap and Trade Program (HECT) caps to the projected VOC emissions, applying rules restricting 

storage tank landings to VOC projections, updating the VOC emissions to account for unreported 

VOC emissions discovered in the Texas Air Quality Study of 2006 (TexAQS II), and adding 

unused emissions credits to the projected NOX and VOC emissions. 

 

The TCEQ designated 2005 as the baseline year for controlled projections since it was the most 

recent National Emissions Inventory year available. The 2005 point source inventory was 

extracted from STARS on February 4, 2009. The extracted data were reported ozone season 

daily emissions of NOX and VOC from each site in the HGB area that submitted a 2005 EIQ and 

reflect revisions made on or before the extract date. 

The NOX emissions allocations in the MECT 2008 NOX cap take into account all NOX controls, 

including controls applied to electric generating units (EGUs) and large stationary engines. 

MECT allocations for EGUs were adjusted by the ratio of 2005 summer daily emissions to 2005 

daily average of annual emissions to account for increased operation during the summer. 

Emissions from sources not subject to the MECT program were developed by applying growth 

factors to the non-MECT sources in the 2005 inventory. 

The VOC emissions were developed by applying the HECT cap to projections. Highly reactive 

VOC (HRVOC) emissions from HECT-applicable units at sites subject to the cap were projected 

using the sitewide cap. Other VOC emissions were projected using growth factors for the nonHECT sources in the 2005 inventory. 

Title 30 TAC Chapter 115 rules that limit tank landings were also applied to VOC projections. 

The revised rule limits convenience landings unless an abatement device is used to control the 

VOC emissions or landing loss emissions are authorized under an emissions limit or cap in a 

permit issued under 30 TAC Chapter 116. The adjustments from this rule were determined as 

follows: emissions from tank landings that occurred in 2002 were summed for each site in each 

county; 2005 emissions were also reviewed to ensure that they were comparable to 2002 values; 

annual averages of the 25 tons per year threshold specified in 30 TAC Chapter 115 were 

determined for each site in each county; and the total landing loss emissions were subtracted from 

these emissions limits on a countywide level. 

Adjustments to county level VOC emissions were made to account for unreported emissions 

determined from ambient monitoring data. Emissions derived from measured ambient VOC 

concentrations in the Houston Ship Channel were determined to be greater than the values in the 

TCEQ’s emissions inventories; however, the difference between ambient and reported VOC 

emissions was less in 2006 than in 2000. This adjustment differed from the uncontrolled 

adjustment because it was developed using the most current science and uses data from a network 

of ambient monitors that was established after the base year. These data were not available 

during the base year and therefore cannot be used to adjust the base year VOC emissions. The 
difference in emissions resulting from these two different adjustments was not claimed as a 

reduction in the RFP demonstration. 

Emissions credits are emissions reductions that may return to the airshed in the future as 

companies elect to use them. To account for this potential increase in NOx and VOC emissions 

in the HGB area, emissions credits banked in the EBT database as of October 2, 2008, were 

added to the projected inventory after the growth factors had been applied. 

Banked ERCs were applied using NSR permitting offsets. An offset ratio of 1.3:1 was applied to 

the banked credits and all of the banked ERCs were applied by the first milestone year. The ERC 

transactions from 2002 to 2008 were also applied. 

For NOX DERCs, no offset ratio was applied because the credits could be applied to MECT 

allowances, with the ratio of 10 tons of DERCs generated before 2005 equaling one ton of 

allowance. The maximum amount of 10,000 tons of DERCs per year specified in 30 TAC 

§101.356 was applied. Historic DERC use has been less than 1 ton per day. 

For VOC DERCs, an offset ratio of 1.1 was applied to account for the 10 percent environmental 

contribution retirement obligation. The credits were applied over ten years, from 2009 to 2018. 

The DERC transactions between 2002 and 2008 were not considered because of the short term 

nature of DERCs. 

Table 2: Contributions to the Controlled Inventory from Emission Reduction Credits 

NOX, tpd VOC, tpd

Banked ERCs 0.30 2.74

Banked DERCs 2.74 0.26

ERC Transactions 0.98 0.41