RULE 2201 NEW AND MODIFIED STATIONA RY SOURCE REVIEW RULE (Adopted September 19, 1991; Amen ded March 11, 1992; Amended October 29, 1992; Amended December 17, 1992; Amended October 21, 1993; Am ended June 15, 1995; Amended August 20, 1998; Amended June 21, 2001, but not effective until August 20, 2001; Amended April 25, 2002; Amende d December 19, 2002; Amended April 20, 2005; Amended De cember 15, 2005; Am ended September 21, 2006; Amended December 18, 2008, but not in effect until June 10, 2010; Amended April 21, 2011) 1.0 Purpose The purpose of this rule is to provide for the following:
1.1 The review of new and modified Stationary Sources of air pollution and to provide mechanisms includ ing emission trade-offs by which Authorities to Construct such sources may be granted, without interfering w ith the attainment or maintenance of Ambient Ai r Quality Sta ndards; and
1.2 No net increase in emis sions above specified thresholds from new and modified Stationary Sources of all nonattainm ent pollutants and their precursors. 2.0 Applicability This rule shall apply to al l new stationary sources and all modifications to existing stationary sources which ar e subject to the District permit requireme nts and after construction emit or may emit one or more affected polluta nt. The require ments of this rule in effect on the date the application is determined to be complete by the Air Pollution Control Officer (APCO) shall apply to such application.
3.0 Defi nitions
3.1 Actual Emissions: emis sions having occurre d from a source, ba sed on source test or monitoring data, actual fu el consumption, and process data. If source test or monitoring data is not av ailable, other a ppropriate, APCO-appr oved, emission factors may be used. 3.2 Actual Emissions Reduction (AER): th e decrease of actual emissions, compared to the Baseline Period, fr om an emissions unit and se lected for use as emission offsets or ERC banking . AER shall meet th e following criteria: 3.2.1 Shall be real, enfo rceable, quantifi able, surplus, and permanent. 3.2.2 To be considered surplus, AER shall be in excess, at the time the application for an Emission Reduction Cr edit or an Authority to Construct authorizing such reductions is de emed complete, of any emissions reduction which:

SJVAPCD 2201 - 1 4/21/113.2.2.1 Is re quired or encumbered by any laws, rules, regulations, agreements, orders, or
3.2.2.2 Is attributed to a contro l measure noticed for workshop, or proposed or containe d in a State Implem entation Plan, or 3.2.2.3 Is proposed in th e APCO's adopted air qu ality plan pursuant to the California Clean Air Act.
3.2.3 Emissions reductions attributed to a propos ed control meas ure, which are excluded pursuant to Se ction 3.2.2.2 and 3.2.2.3 may be re-eligible as AER if the control measures identified in the District Ai r Quality Plan or State Implementation Plan (SIP), are determined not to be necessary for attainment or maintenance of Ambi ent Air Quality St andards and the APCO and United States Environmental Protecti on Agency (EPA) have approved amendments to th e plan or SIP to reflect this determination. 3.3 Administrative Change: a chan ge to an existing permit that: 3.3.1 Corrects typogr aphical errors; or 3.3.2 Identifies a change in the name, address, or phone num ber of any person identified in the permit, or provides a similar minor administrative change at the source; or 3.3.3 Changes the components of emis sions monitoring equipment or other components, which have no effect on the quantity of emissions from an emissions unit, or 3.3.4 Allows for the change of ownership or operational contro l of a source where the APCO determines that no other change is necessary.
3.4 Affected Pollutants: th ose pollutants for which an Am bient Air Quality Standard has been established by the EPA or by the California Air Resources Board, (ARB), and the precursors to such pollutants, and t hose pollutants regulated by the EPA under the Federal Clean Air Act or by the ARB under the Health and Safety Code incl uding, but not li mited to, VOC, NO x , SO x , PM2.5, PM10, CO, and those pollutants which th e EPA, after due process, or the ARB or the APCO, after public hearing, dete rmine may have a signific ant adverse effect on the environment, the public heal th, or the public welfare. 3.5 Agricultural Source: eq uipment or operations that emit air contaminants and that are used in the productio n of crops or the raisi ng of fowl or animals. 3.6 Air Quality Improvement Deduction: a 10 pe rcent discount fa ctor applied to Actual Emission Reductions (AER) before the AER is eligible for banking.

SJVAPCD 2201 - 2 4/21/113.7 Ambient Air Quality Standards: incl ude State and National Ambient Air Quality Standards. (In the inclusion of this rule in the State Implementation Plan, all references in this rule to Ambient Air Quality Standards shal l be interpreted as National Ambient Air Quality Standards.) 3.8 Baseline Emissions (BE): fo r a given pollutant, shall be equal to the sum of: 3.8.1 The pre-project Po tential to Emit for: 3.8.1.1 Any emissions unit loca ted at a non-Major Source, 3.8.1.2 Any Highl y-Utilized Emissions Unit, located at a Major Source, provided that if the unit has a Specif ic Limiting Condition (SLC), all units combined under the SL C have an average combined annual Actual Emissions durin g the two cons ecutive years immediately prior to fi ling of an application for an Authority to Construct equal to or greater than 80% of the units’ pre-project SLC limit, 3.8.1.3 Any Fully-Offset Emissions Unit, located at a Major Source, provided that if the unit has a SL C, all units under the SLC also qualify as Fully Offset Emissions Units, or 3.8.1.4 Any Clean Emissi ons Unit, located at a Major Source, provided that if the unit has a SLC, all units under the SLC also qualify as Clean Emissions Units.
3.8.2 The Historic Actual Emissions (HAE) for emissions units not specified in Section 3.8.1. 3.9 Baseline Period: a period of time equal to either 3.9.1 the two consecutive ye ars of operation immediately prior to the submission date of the Complete Application; or
3.9.2 at least two c onsecutive years within the five years immediately prior to the submission date of the Complete Application if determined by the APCO as more repres entative of normal s ource operation; or 3.9.3 a shorter period of at least one year if the emi ssions unit has not been in operation for two years and this represents the full operational history of the emissions unit, including any replacement units; or 3.9.4 zero years if an emissions unit has been in operation for less than one year (only for use when calculating AER).

SJVAPCD 2201 - 3 4/21/113.10 Best Available Contro l Technology (BACT): is the most stringent emission limitation or control tech nique of the following: 3.10.1 Achieved in prac tice for such category a nd class of source;
3.10.2 Contained in a ny State Implementation Plan approved by the Environmental Protection Agency for such category and class of source. A specific limitation or c ontrol technique sh all not apply if the owner of the proposed emissions un it demonstrates to th e satisfaction of the APCO that such a limi tation or control techni que is not presently achievable; or
3.10.3 Contained in an a pplicable federal New Source Perfor mance Standard; or 3.10.4 Any other emi ssion limitation or control te chnique, including process and equipment changes of basic or control equipment, found by the APCO to be cost effective and technol ogically feasible fo r such class or category of sources or for a specific source. 3.11 Biomass-fired power faci lity: a facility generating electrical power and fueled exclusively on biomass fuels consisting of at least 90% of one or more of the following constituents: alfalfa, barley, bean straw, corn, oats, whea t, orchard and vineyard pruning, a nd forest residues. Grape stems, grap e pumice, almond and walnut shells, construction wood waste, urban wood waste, and lawn trimmings are not considered biomass fuels. 3.12 Cargo Carriers: trains dedicated to a specific Stationary Source and vessel dockside activities as defi ned in 45 Federa l Register 52696 (August 7, 1980) for vessels dedicated to a specific Stationary Source. Motor vehi cles, as defined by the Vehicle Code of the St ate of California, are not considered Cargo Carriers.
3.13 Clean Emissions Un it: for a given pollutant, an em issions unit that meets one of the following criteria: 3.13.1 The unit is equipped with an emissions c ontrol technology with a minimum control efficiency of at least 95% (or at least 85% for leanburn, internal combustion engines); or 3.13.2 The unit is equipped with emi ssion control technol ogy that meets the requirements for achieved-in-practice BACT as accept ed by the APCO during the five years immediately prior to the submission of the complete application. 3.14 Complete Application: an applicat ion for an Emission Re duction Credit or an Authority to Construct for a new or m odified emissi ons unit whic h has been

SJVAPCD 2201 - 4 4/21/11evaluated and found to include all information necessa ry to determin e compliance with applicable rule s and requirements. 3.15 Contiguous or Adj acent Property: a property consisting of tw o or more parcels of land with a common point or boundary, or separate d solely by a public roadway or other publi c right-of-way. 3.16 Daily Emissions Li mitation (DEL): one or more perm it conditions which restrict a unit's maximum daily emissi ons, to a level at or belo w the emissions associated with the maximum design capacity. A daily emissions li mitation must be:
3.16.1 Contained in the latest Authority to Cons truct and contained in or enforceable by the latest Permit to Operate for the emissions unit; and 3.16.2 Enforceable, in a practical manner, on a daily basis.
3.17 Emissions Unit: an identifiable operati on or piece of process equipment such as a source operation which emits, may emit, or results in the emissions of any affected pollutant directly or as fugitive emissions. 3.18 Federal Major Modificatio n: same as “Major Modification” as defined in 40 CFR 51.165 and part D of Ti tle I of the CAA. SB 288 Major Modifications are not federal major modifications if they m eet the criteria of one of the following exclusions: 3.18.1 Less-Than-Signi ficant Emissions Increase Exclusion: An emissions increase for the project, or a net em issions increase fo r the project (as determined pursuant to 40 CFR 51.165 (a)(2)(ii) (B) through (D), and (F)), that is not significant for a given regulated NSR pollutant, as defined in 40 CFR 51.165, is not a federal major modi fication for that pollutant.
3.18.1.1 To determine th e post-project projected actual emissions from existing units, the provisions of 40 CFR 51.165 (a)(1)(xxviii) shall be used.
3.18.1.2 To determine th e pre-project baseline actual emissions, the provisions of 40 CF R 51.165 (a)(1)(xxxv)(A) through (D) shall be used. 3.18.1.3 If the project is determ ined not to be a federal major modification pursuan t to the provisions of 40 CFR 51.165 (a)(2)(ii)(B), but there is a reasonable possibility that the project may result in a signifi cant emissions increase, the owner or operator sh all comply with all of the provisions of 40 CFR 51.165 (a)(6) and (a)(7).

SJVAPCD 2201 - 5 4/21/113.18.1.4 Emissions increa ses calculated pursuant to this section are significant if they exceed the significance thresholds specified in Table 3-1 of this rule. Table 3-1, Significance Thresholds POLLUTANT THRESHOLD (POUNDS PER YEAR) VOC 0 NOx 0 20,000 of direct PM 2.5 emissions or 80,000 of sulfur diox ide emissions or PM2.5 80,000 of nitrogen oxide emissions PM10 30,000

SOx 80,000 3.18.2 Plantwide Applicab ility Limit (PAL) Exclus ion: An SB 288 major modification that does not cause faci lity-wide emissions to exceed a preestablished PAL, as defined in 40 CFR 51 .165 (f)(2)(v), for the respective pollutant, is not a fede ral major modification for that pollutant. PAL exclusions shall not be allowed for e ither NOx or VOC pollutants. 3.18.2.1 For the purposes of th is exclusion, a PAL must be established by a permitting action prior to the SB 288 major modification pe rmitting action.
3.18.2.2 All PALs shall be established accordi ng to the provisions of 40 CFR 51.165 (f)(1) through (15). 3.18.2.3 All PALs shall comply w ith the requirements under 40 CFR 51.165 (f)(1) through (15) to either maintain , renew or retire the PAL. 3.19 Fugitive Emissi ons: emissions that could not reasonably pass through a vent, chimney, stack, or other functionally e quivalent opening. Em issions that are not vented through a stack but can reasonably be captured and ve nted through a stack are not considered Fugitive . Fugitive emis sions shall be included in all calculations, except as provided for in Section 3.24 and as allowed in the applicable 40 CFR Part 51.165. 3.20 Fully Offset Emissions Unit: for a given pollutant, an emissions unit for which 3.20.1 Offsets have been pr ovided for the unit’s full potential to emit; or 3.20.2 Offsets have been pr ovided for the entire statio nary source’s potential to emit in excess of the o ffset trigger level; or

SJVAPCD 2201 - 6 4/21/113.20.3 Offsets have previously been pr ovided for the stati onary source’s NSR balance as calculated pursuant to the NSR rule in effect at the time of the offset action, and the emissions unit was installed after the County baseline date as indicated below: Table 3-2, C ounty Baseline Dates COUNTY BASELINE DATE San Joaquin Count y May 29, 1979 Stanislaus County June 19, 1979 Merced, Madera, or Ki ngs County May 21, 1979 Fresno County Oil Fiel ds September 20, 1983 Fresno County all other sources January 1, 1977 Tulare County June 26, 1979 September 12, 1979 Kern County Heavy Oil Production June 22, 1987 for heavy oil production operations with negative cumulative ne t emissions change as of June 22, 1987 Kern County all other sources December 28, 1976 3.21 Heavy Oil: crude o il having an American Petrol eum Institute gravity of 20 degrees or less as determined by test method ASTM 287-82. 3.22 Highly Utilized Emissi ons Unit: for a given pollu tant, an emissions unit for which the average annual Actual Emis sions during the two consecutive years immediately prior to filing of an application for an Au thority to Construct were equal to or greater than 80% of the unit’ s pre-project Potentia l to Emit. The unit must have been in operation for at least two years and, during that entire period, the unit must have complied with all applicable emi ssion limits and performance standards.
3.23 Historical Actual Em issions (HAE): Actual Emi ssions occurring during the Baseline Period, afte r discounting for: 3.23.1 Any emissions reductio ns required or encumbered by any laws, rules, regulations, agreements, or ders, or pe rmits; and 3.23.2 Any emissions reductio ns attributed to a cont rol measure noticed for workshop, or proposed or contained in a State Implemen tation Plan, and 3.23.3 Any emissions reductions proposed in the District ai r quality plan for attaining the annual reductions requi red by the Californi a Clean Air Act, and

SJVAPCD 2201 - 7 4/21/113.23.4 Any Actual Em issions in excess of those requir ed or encumbered by any laws, rules, regulations, orders, or permits. For units covered by a Specific Limiting Condit ion (SLC), the total overall HAE for all units covered by SLC must be di scounted for any emission s in excess of that allowed by the SLC. 3.24 Major Source: fo r each pollutant, a Stationary Sour ce with post-pro ject emissions or a post-project Stationary Source Potential to Emit (SSPE2), equal to or exceeding one or more of the following thresh old values. 3.24.1 For determining major source status, fugitives shall only be included for calculating the air pollu tant post-project emissi ons or SSPE2 if the source is included in the list of source categor ies identified in the major source definition in 40 CFR Part 70.2, or when determining if a stationary source is a ma jor air toxics source as defined in Rule 2520. Table 3-3, Major S ource Emission Thresholds POLLUTANT THRESHOLD (POUNDS PER YEAR) VOC 20,000 NOx 20,000 CO 200,000 PM2.5 200,000 PM10 140,000

SOx 140,000 3.24.2 For the purpose of de termining major source st atus, the SSPE2 shall not include the qua ntity of emission reduction credits (ERC) which have been banked since Septem ber 19, 1991 for Actual Emissions Reductions that have occurred at the source, an d which have not be en used on-site. This ERC quantity includes all ERC he ld as certificates and all emission reduction credits th at have been sold or transferred.
3.25 Modification:
3.25.1 An action includ ing at least one of the following items: 3.25.1.1 Any change in hours of operation, produc tion rate, or method of operation of an existing emissions unit, which would necessitate a change in permit conditions. 3.25.1.2 Any struct ural change or addition to an existing emissions unit which would neces sitate a change in permit conditions. Routine replacement shall not be considered to be a structural change.

SJVAPCD 2201 - 8 4/21/113.25.1.3 An increase in emissions fr om an emissions unit caused by a modification of the Stationary Source wh en the emissions unit is not subject to a dail y emissions limitation.
3.25.1.4 Addition of a ny new emissions unit wh ich is subject to District permitting requirements. 3.25.1.5 A change in a permit term or condition proposed by an applicant to obtain an exem ption from an applicable requirement to which the source would otherwis e be subject.
3.25.2 A reconstructed Statio nary Source shall be treated as a new Stationary Source and not as a modification. 3.25.3 Unless previously li mited by a permit condition, the followi ng shall not be considered a modification: 3.25.3.1 A change in ow nership of an existing emissions unit with valid Permit to Operate provide d that the APCO determines that all applicable offset provi sions required by the Permit to Operate will be met; 3.25.3.2 A change in ow nership of an entire existing Stationary Source with a valid Permit to Operate; 3.25.3.3 A change which consists solely of a transfer of location of an emissions unit within a Stationary Source; or 3.25.3.4 Routine replace ment of a whole or partial emissions unit where the replacement part is the same as the original emissions unit in all respects except for the serial number.
3.26 Offsets: emission reduc tions recognized by the APCO in the form of Emission Reduction Credits that are issued in acco rdance with the provisions of Rule 2301 (Emission Reduction Credit Ba nking), or other Actual Emissions Reductions that may be used to mitigate an emission incr ease as part of the same Stationary Source Project in accor dance with the provisions of this rule.
3.27 Potential to Emit: the maximum capacity of an emissi ons unit to emit a pollutant under its physical and operational design. Any physical or operational limitation on the capacity of the source to emit a polluta nt, including po llution control equipment and restri ctions in hours of operation or on the type or amount of material combusted, stored, or processed, shall be treat ed as part of its design only if the limitation or the effect it would ha ve on emissions is incorporated into the applicable permit as an enforceable perm it condition.

SJVAPCD 2201 - 9 4/21/113.28 PM2.5: part iculate matter with an aerodynamic diameter sma ller than or equal to a nominal 2.5 microns. 3.29 PM10: particulate matte r with an aerodynamic diameter smaller than or equal to a nominal ten micr ons, as defined in District Rule 1020, Definitions.
3.30 Pre-baseline ERCs: Em ission Reduction Credits that were banked prior to the baseline year for a given District-adopted and EPA- approved Attainment Plan.
3.31 Precursor: a di rectly emitted air contaminant that, when released into the atmosphere, forms or causes to be formed or contributes to the formation of a secondary air contaminant for which an Ambient Air Quality Standard has been adopted, or whose presence in the atmosphere wi ll contribute to the violation of one or more Ambient Air Quality Standa rds. The following precursor-secondary air contaminant relationshi ps shall be used for th e purposes of this rule: Table 3-4, Precursors PRECURSOR SECONDARY AIR CONTAMINANT Volatile Organic Compounds a. Photochemical oxidants (Ozone) b. The organic fraction of PM10

Nitrogen Oxides a. Nitrogen Dioxide b. The nitrate fraction of PM2.5 c. The nitrate fraction of PM10 d. Photochemical oxidants (Ozone)

Sulfur Oxides a. Sulfur dioxide b. Sulfates c. The sulfate fraction of PM2.5 d. The sulfate fraction of PM10
3.32 Quarter: fo r a non-Seasonal Source, th is is defined as a cal endar quarter. For a Seasonal Source, a quarter is defined as the entire operating season. 3.33 Reasonable Further Progress: as defi ned by the federal Clea n Air Act, Section 182(c)(2)(b).
3.34 Reconstructed S ource: any Stationary Source undergoing reconstruction where the fixed capital cost of th e new components excee ds 50% of the fi xed capital cost of a comparable, entirely new Stationary S ource. Fixed capital cost is the capital needed to provide deprec iable components. Reconstr ucted Source cost shall include only the cost of al l emission-producing equipmen t and associat ed integral activities at the stationary source. A recons tructed Stationary Source shall be considered a new Stationary Source and not as a m odification of an existing Stationary Source.

SJVAPCD 2201 - 10 4/21/113.35 Routine Replacement: r outine replacement in whole or in part of any article, machine, equipment, or other contrivance with a valid District Permit To Operate provided that all of the fo llowing conditions are met:
3.35.1 There is no increase in permitted emissi ons from the repl acement unit(s). 3.35.2 There is no increase in design capa city, unless an old part is no longer available in which case the replacemen t can result in a design capacity increase of up to 10%. No change to the permitted throughput or emissions is authorized due to a cha nge in design capaci ty as part of routine replacement. Such changes shall require application for permit modification. 3.35.2.1 Permitted throughputs ar e throughput limits upon which emission calculations are, or could be, based. 3.35.2.2 If there are no throughput limiting conditions, permitted throughput shall be a throug hput rate which affects emissions. 3.35.3 The replacement e quipment performs the same function as the equipment being replaced. 3.35.4 The replacement does not constitute a Reconstructed Sour ce (as defined by this rule) or Reconstruction (a s defined by any applicable New Source Performance Standa rd). Reconstructed Sour ce cost shall include only the cost of a ll emission-producing equipment and asso ciated integral activities at the stationary source.
3.35.5 When the entire emi ssions unit is replaced as a routine replacement action, the emissions uni t shall either have b een addressed by a BARCT rule or shall be equipped with a co ntrol device capable of at least 85% emission control. 3.36 SB 288 Major Modification: as defined in 40 CFR Pa rt 51.165 (as in effect on December 19, 2002) and part D of Title I of the CAA (as in effect on December 19, 2002). For the purposes of this de finition, the SB 288 major modification thresholds for existing major s ources are listed as follows: Table 3-5, SB 288 Major M odification Thresholds POLLUTANT THRESHOLD (POUNDS PER YEAR) VOC 50,000 NOx 50,000 PM10 30,000

SOx 80,000

SJVAPCD 2201 - 11 4/21/113.37 Seasonal Source: any St ationary Source with more than 90% of its annual emissions occurring within a consecutiv e 120-day period. 3.38 Specific Limiting Condit ion (SLC): permit terms or conditions, which can be enforced in a practical manner, contained in Authorities to Construct and Permits to Operate and established pur suant to New Source Review provision s that restrict the total overall permitted emissions from two or more emissions units. 3.39 Stationary Source: any building, structure, facility, or installa tion which emits or may emit any affected polluta nt directly or as a fugi tive emission. Building, structure, facility or inst allation includes all pollutant emitting activities including emissions units which:
3.39.1 Are under the same or common ow nership or operation, or which are owned or operated by entities which are under common control; and 3.39.2 Belong to the same i ndustrial grouping eith er by virtue of falling within the same two-digit standa rd industrial classificati on code or by virtue of being part of a common industrial process, manufacturing process, or connected process involving a common raw material; and
3.39.3 Are located on one or more conti guous or adjacent properties; or
3.39.4 Are located on one or more properti es wholly within either the Western Kern County Oil Fields or the Central Kern Coun ty Oil Fields or Fresno County Oil Fields and are used for the production of light oil, heavy oil or gas. Notwithstanding the provisi ons of this defi nition, light oil production, heavy oil pr oduction, and gas produc tion shall constitute separate Stati onary Sources. 3.40 Stationary Source Proj ect: a single permitting acti on involving the modification, addition or shutdown of one or more emissi ons units. If any increase in emissions from a new or modified emissions unit is permitted based on emission reductions from one or more emissions units included in the statio nary source project, the following condition mu st also be met:
3.40.1 The modification or shutdown resulting in the necessary emission reductions shall occur not later than the date of initial operation of the new or modified emissions unit. If the new or modified emissions unit is, in whole or in part , a replacement for an ex isting emissions unit at the same stationary source, the AP CO may allow a ma ximum of 90 days as a start up pe riod for simultaneous operation of the existing emissions unit and the replaceme nt emissions unit.

SJVAPCD 2201 - 12 4/21/113.41 Temporary Replacement Em issions Unit (TREU): an em issions unit which is at a Stationary Source for less than 180 days in any twelve month period and replaces an existing emissions unit which is sh utdown for maintenan ce or repair.
3.41.1 The Potential to Emit from a TR EU must not exceed the Potential to Emit from the existing emissions unit. 3.41.2 If a TREU is used to replac e a TREU, the comb ined time at the Stationary Source for th e two TREU shall not exceed a total of 180 days in any twelve -month period.
3.41.3 An emissions unit no t removed from the Stationary Source within 180 days is not a TREU. 4.0 Source Requirements
4.1 Best Available Control Technology (BACT): BACT requirements shall be triggered on a pollutant-by-pollutant basis and on an emissions unit-by-emissions unit basis. Unless exempted pursuant to Sectio n 4.2, BACT sha ll be required for the following actions: 4.1.1 Any new emissi ons unit or relocation from one Stationary Source to another of an exis ting emissions unit with a Potential to Emit exceeding 2.0 pounds in any one day;
4.1.2 Modifications to an existing emissions unit wi th a valid Permit to Operate resulting in an Adjusted In crease in Permitted Emissions (AIPE) exceeding 2.0 pounds in any one day; 4.1.3 Any new or modified emissions unit, in a stationary source project, which results in an SB 288 Major Modification or a Federal Major Modification, as defi ned in this rule. 4.2 BACT Exemptions: BACT shall no t be required for the following:
4.2.1 CO emissions from a new or modified emissions unit at a Stationary Source with a post projec t Stationary Source Pote ntial to Emit (SSPE2) of less than 200,000 pounds CO per year; 4.2.2 Cargo Carriers; 4.2.3 For existing facilities, the instal lation or modificati on of an emission control technique performe d solely for the purpose of compliance with the requirements of Di strict, State or Federal air pollution control laws, regulations, or orders, as approved by the APCO, shall be exempt from Best Available Control T echnology for all air pollu tants, provided all of the following cond itions are met:

SJVAPCD 2201 - 13 4/21/114.2.3.1 There shall be no increase in the physical or operational design of the existing facility, except for those changes to the design needed for the installation or modification of the emission control techni que itself;
4.2.3.2 There shall be no increase in the permitted rating or permitted operating schedul e of the perm itted unit;
4.2.3.3 There shall be no increase in emissions from the stationary source that will cause or cont ribute to any violation of a National Ambient Air Quality Standard, Prevention of Significant Dete rioration increment, or Air Quality Related Value in Class I areas; and 4.2.3.4 The project shall not result in an increase in permitted emissions or potential to emit of more than 25 tons per year of NOx, or 25 tons per year of VOC, or 15 tons per year of SOx, or 15 tons per year of PM-10, or 50 tons per year of CO. 4.2.3.5 The project shal l not constitute a federa l major modification.
4.2.4 New emissions unit or modification of an existing emissions unit for voluntary reduction in emissions, for the sole purpose of generating emission reduction credits. This exemption applie s only to the pollutant for which emission reduc tion credits are obtain ed. BACT may be required for ot her affected pollutants; 4.2.5 Temporary Replacement Emis sions Units;
4.2.6 Routine Re placement; or
4.2.7 Transfer of lo cation of emissi ons units within the sa me stationary source. 4.3 Adjusted Increase in Pe rmitted Emissions (AIPE) Calc ulations: Adju sted Increase in Permitted Emissions sh all be calculated as AIPE = PE2 - HAPE Where: AIPE = Adjusted Increase in Permitted Emission s, pounds per day PE2 = the emissions units post project Potent ial to Emit, pounds per day HAPE = the emissions uni t’s Historically Adjusted Potential to Emit, pounds per day

SJVAPCD 2201 - 14 4/21/114.4 Historically Adjusted Potential to Em it (HAPE) Calculations: Historically Adjusted Potential to Emit shall be ca lculated as HAPE = PE1 x (EF2 / EF1) Where: PE1 = The emissions unit’s Potential to Em it prior to modifica tion or relocation EF2 = The emissions unit’s permitted emission factor for the pollutant after modification or relocation. If EF2 is greater than EF1 then EF2/EF1 shall be set to 1. EF1 = The emissions unit’s permitted emission f actor for the pollutant before the modification or relocation
4.5 Emission Offset Requirements:
4.5.1 If emission offs et requirements are triggered pursuant to Section 4.5.3, emission offsets shall be provided fo r net emissions in creases resulting from a project. Offset quantities shall be calcul ated pursuant to Section 4.7. 4.5.2 For Stationary Sources with a qu arterly Potential to Emit which remain constant throughout the ye ar, the amount shall be calculated in pounds per year. For Stationary Sour ces with quarterly Potent ial to Emit that is not constant throughout the ye ar, and for Seasonal S ources the amount shall be calculated in pounds per quarter. 4.5.3 Offset requirements shall be triggered on a pollu tant-by-pollutant basis. Unless exempted pursuant to Section 4.6, offsets shall be requi red if the post-project Stati onary Source Potential to Emit (SSPE2) equals or exceeds the following o ffset threshold levels: Table 4-1, Emissions Offset Thres hold Levels POLLUTANT SSPE2 (POUNDS /YEAR) VOC 20,000 NOx 20,000 CO (non-attainment areas) 30,000 CO (attainment areas) 200,000 SOx 54,750 PM10 29,200

4.5.4 Offsets shall be re quired for PM2. 5 and PM2.5 prec ursor emission increases for such increas es that constitut e new major sour ces or federal major modifications. 4.6 Emission Offset Exemptions: Emission offsets shall not be required for the following:

SJVAPCD 2201 - 15 4/21/114.6.1 Increases in carbon monoxide in attainment areas if the applicant demonstrates to the satisfaction of the APCO, that the Ambient Air Quality Standards are not violated in the areas to be affected, and such emissions will be consistent with Reasonable Further Progres s, and will not cause or contribute to a violation of Ambien t Air Quality Standards; 4.6.2 Emergency equipment that is used excl usively as emer gency standby equipment for electric power generation or any other emergency equipment as approved by the APCO that does not operate more than 200 hours per year for non-emergency purpos es and is not us ed pursuant to voluntary arrangements with a power supplier to curtail power. Equipment exempted by th is section shall maintain a written record of hours of operation and shall have permit c onditions limiting nonemergency operation; 4.6.3 Portable equipm ent which is registered as such in accordance with the provisions of Rule 2 280 (Portable Equipment Registration) or the Statewide Portable Equipment Regist ration Program (Cal ifornia Code of Regulation Title 13, Ar ticle 5, Sections 24 50-2465), or equipment registered in acco rdance with the prov isions of Rule 2250 (Permit-Exempt Equipment Registration).
4.6.4 On-site soil or groundwater decontaminati on performed by, under the jurisdiction of, or pursuan t to the requirements of an authorized health officer, agricultural commissioner, fire protection officer, or other authorized government of ficers, provided emissi ons do not exceed 4,000 pounds per year of any affected po llutant from all emissions units associated with dec ontamination project; 4.6.5 Temporary Replacement Emis sions Units.
4.6.6 A transfer of location of an entire Stationary So urce within the District, under the same owne r and provided:
4.6.6.1 The Potential to Emit of a ny affected pollutant will not be greater at the ne w location than at the pr evious location when all emissions units are operated at the same permitted conditions; and 4.6.6.2 BACT is applied to all emissions units wi th a Potential to Emit exceeding 2.0 pounds per day; and 4.6.6.3 The transferred Stationary S ource is not adde d to an existing Stationary Source.

SJVAPCD 2201 - 16 4/21/114.6.7 A transfer of location of an emissions unit from one Stationary Source to another within the District, under the same owne r and provided:
4.6.7.1 The Potential to Emit of a ny affected pollutant will not be greater at the ne w location than at the pr evious location when all emissions units are operated at the same permitted conditions, and
4.6.7.2 The offsets that would be otherwise required for the unit at the new location have been provi ded for the emissions unit previously. 4.6.8 For existing facilities, the instal lation or modificati on of an emission control technique performe d solely for the purpose of compliance with the requirements of Di strict, State or Federal air pollution control laws, regulations, or orders, as approved by the APCO, shall be exempt from offset requirements for all air polluta nts provided all of the following conditions are met:
4.6.8.1 There shall be no increase in the physical or operation al design of the existing facili ty, except for those changes to the design needed for the installation or modification of the emission control techni que itself;
4.6.8.2 There shall be no increase in the permitted rating or permitted operating schedul e of the perm itted unit;
4.6.8.3 There shall be no increase in emission s from the stationary source that will ca use or contribute to any violation of a National Ambient Air Qualit y Standard, Pr evention of Significant Dete rioration increment, or Air Quality Related Value in Class I areas; and 4.6.8.4 The project shall not result in an increase in permitted emissions or potential to emit of more than 25 tons pe r year of NOx, or 25 tons per year of VOC, or 15 tons per year of SOx, or 15 tons per year of PM-10, or 50 tons per year of CO. 4.6.9 Agricultural Sources, for criteria pollutants for that source if emissions reductions from that source would not meet the criteria for real, permanent, quantifiabl e, and enforceable em ission reductions.
4.6.9.1 In no case shall the offset exemption in section 4.6.9 apply to an agricultural source that is also a major st ationary source for the pollutant for whic h the offset exem ption is sought.

SJVAPCD 2201 - 17 4/21/114.7 Emission Offset Quantity Calculations: 4.7.1 For pollutants with a pre-project Stationary S ource Potential to Emit (SSPE1) greater than the emission offs et threshold levels, emission offsets shall be provided for:
4.7.1.1 All increases in Stationary Source emissi ons, calculated as the sum of differences between the post-project Potential to Emit (PE2) and the Baseline Emissions (BE) of all ne w and modified emissions units, plus
4.7.1.2 All increases in Cargo Carrier emissions. 4.7.2 For pollutants with a pre-project Stationary S ource Potential to Emit (SSPE1) less than or equa l to the offset threshol d levels, emission offsets shall be provided for:
4.7.2.1 All incr eases in Stationary Source emissions above the offset trigger levels, calculated as th e difference between the SSPE2 and the offset trigger level, plus
4.7.2.2 All increases in Cargo Carrier emissions. 4.7.3 The quantity of offset s calculated pursuant to Sections 4.7. 1 and 4.7.2 shall be multiplied by th e appropriate Distance Of fset Ratio to determine the final quantity of offsets required. 4.7.4 PM10 Emissions: In determining the qua ntity of required PM10 offsets, the Total Suspended Particulate Matte r (TSP) emissions for which full offsets have been previo usly provided shall not be recalculated as PM10.
4.8 Distance Offset Ratio: Fo r offset calculations, the distan ce offset ratio shall be as shown below:
4.8.1 For NOx and VOC offsets for new major sources and federal major modifications, the distance offset ratio shall be 1.5;
4.8.2 For PM2.5 and PM2.5 precursor of fsets for new major sources and federal major modifications, the offset ratio shall be 1.0;
4.8.3 The requirements of section 4.8.1 shall not apply if the District demonstrates to the satisfaction of the federal Environm ental Protection Agency that all major sources of NOx and VOC in th e District are equipped with fede ral BACT, as defined in CA A Section 169(3). After EPA approval of such a de monstration, the standard distance offset ratios listed in Table 4-2 shal l apply for new major s ources and federal major

SJVAPCD 2201 - 18 4/21/11modifications, ex cept that where the original location of the offsets is at the same stationary source as the new or modified em issions unit, the distance offset rati o shall be 1.2.
4.8.4 For all other projects not specified above , the standard distance offset ratio shall be as show n in Table 4-2: Table 4-2, Standard Distance Offset Ratio ORIGINAL LOCATION OF EMISSION OFFSETS OFFSET RATIO at the same Stationary Source as the new or modified emissions unit 1.0

within 15 miles of the new or modified emissions unit’s Stationary Source 1.2 for Non-Major Sources 1.3 for Major Sources 15 miles or more from the new or modified emissions unit’s Stationary Source 1.5
4.9 Pre-project Stationary Sour ce Potential to Emit (SSPE1) shall be calculated as the sum of the following:
4.9.1 The Potential to Emit from all units with valid Authorities to Construct (ATC) or Permits to Operate (P TO) at the Sta tionary Source.
4.9.1.1 For a unit with both a valid ATC and a PTO or a unit with multiple valid ATC, use the ATC or PTO with the highest potential emissions.
4.9.1.2 For units su bject to an SLC, the Poten tial to Emit shall be based on the overall Potential to Emit li mit for all units covered by the SLC and not the sum of the individual Potential to Emit of each emissions unit. 4.9.2 The quantit y of emission reduct ion credits (ERC) whic h have been banked since September 19, 1991 for Actual Emissions Re ductions that have occurred at the source, and which have not been used on-site. This quantity includes all ERC held as cer tificates and all emission reduction credits that have been sold or transf erred. Reductions shall be added to the SSPE1 as positive values. 4.10 Post-project Stationary Source Potential to Emit (SSP E2) shall be ca lculated, on a pollutant-by-pollutant basis, as the sum of the following:
4.10.1 The Potential to Emit from all units with valid Authorities to Construct or Permits to Operate at the Stati onary Source, exce pt for emissions units proposed to be shutdown as part of a Stationary S ource Project.

SJVAPCD 2201 - 19 4/21/114.10.1.1 The Potential to Emit of the post-p roject Authority to Construct will be used for new or modified units, provided that the ATC will include new conditio ns canceling the existing ATC or PTO for those units, otherwise use the ATC or PTO with the highest potential emissions.
4.10.1.2 For units subject to an SLC, the Po tential to Emit shall be based on the overall Potential to Emit limit for all units covered by the SLC and not the sum of the individual Potential to Emit of each emissions unit. 4.10.2 The quantity of em ission reduction credits (ERC) which have been banked since Septem ber 19, 1991 for Actual Em issions Reductions that have occurred at the source, and which have not been used on-site. This quantity includes all ERC held as certificates and all emission reduction credits that have been sold or transf erred. Reductions shall be added to the SSPE2 as positive values.
4.11 Calculations i nvolving PM10 emissions 4.11.1 For existing Stationa ry Sources for wh ich particulate matter emissions have been calculated as Total Su spended Particulat e (TSP), the PM10 emissions shall be recalculated fr om TSP values us ing PM10 emission factors or speciation data.
4.11.2 In the absence of PM10 emission s factors or specia tion data, assume 50% of the total suspende d particulates is PM10. 4.11.3 If the applicant has previously provided full of fsets for total suspended particulate matter emissions, thos e total suspended particulate matter emissions need not be recalculat ed as PM10, fo r the purpose of determining the quant ity of offsets.
4.12 Actual Emissions Reduc tions (AER) Calculations: Actual Emissions Reductions shall be calculated, on a pollutant-by-pollutant basis, as follows: AER = HAE - PE2 Where: HAE = Historic Actual Emissions PE2 = Post-project Potential to Emit 4.12.1 Prior to banking, AER shall be discounted by 10 percent (10%) for Air Quality Improvement Deduction, and shall comp ly with all applicable provisions of Rule 2301 (Emiss ion Reduction Cr edit Banking).

SJVAPCD 2201 - 20 4/21/114.13 Additional Offset Requirements: Offsets obtained su bject to this rule shall comply with the follow ing provisions: 4.13.1 Major Source shutdowns or permanent curt ailments in production or operating hours of a Majo r Source may not be used as offsets for emissions from a Major S ource, a Federal Major M odification, or an SB 288 Major Modification, unless the ER C, or the emissions from which the ERC are derived, has been included in an EPA-approved attainment plan.
4.13.2 Offsets from another district may be used only if the source of the offsets is within 50 miles of the pr oposed emissions increases and the APCO has reviewed the permit conditions issued by the di strict in which the proposed offsets are obt ained and certifies that such offsets meet the requirements of th is rule and CH&S C Section 40709.6. 4.13.3 Interpollutant offsets: 4.13.3.1 Interpo llutant offsets may be a pproved by the APCO on a case-by-case basis, provided th at the applicant demonstrates to the satisfaction of the APCO , that the emission increases from the new or modified source will not caus e or contribute to a violation of an Ambient Air Quality Standard. In such cases, the APCO shall, based on an air quality analysis, impose offset ratios equal to or greater than the requirements of this rule.
4.13.3.1.1 In no case shall exempt com pounds or the other compounds excluded from the definition of VOC be used as offsets for VOC. 4.13.3.1.2 Interpollutant of fsets between PM10 and PM10 precursors may be allowed.
4.13.3.1.3 PM10 emissions shall not be allowed to offset NOx or reactive organic compound emissions in ozone nonattainment areas, nor be allowed to offset SO2 emissions in sulfate nonattainment
areas. 4.13.3.1.4 Interpollutant offs ets between NOx and VOC may be allowed. 4.13.3.2 Interpollutant offsets be tween PM2.5 and PM2.5 precursors are allowed at specific ratios as established by US EPA, or as approved into the State Implementation Plan by the US EPA.

SJVAPCD 2201 - 21 4/21/114.13.4 Actual Emissions Reduc tions (AER) used as offsets must have occurred during the same cale ndar quarter as the emissi ons increases being offset except as allowed pur suant to Sections 4.13.6 through 4.13.9.
4.13.5 AER used as offsets for a Seasonal Source must have occurred during the same time period as the propos ed source will operate except as allowed pursuant to Secti ons 4.13.6 through 4.13.9.
4.13.6 AER used as offsets for a biomass-fired power facility may have occurred during any quarter.
4.13.7 AER for PM that oc curred from October throu gh March, incl usive, may be used to offset in creases in PM during any period of the year.
4.13.8 AER for NOx and VOC that occu rred from April th rough November may be used to offset increases in NOx and VOC dur ing any period of the year.
4.13.9 AER for CO that occurred from November through February may be used to offset increases in CO during any period of the year.
4.13.10 AER used as offs ets for new and modified Major Sources must be obtained from an area:
4.13.10.1 That has a nona ttainment classification that is equal to or higher than the area in whic h the new or m odified Major Source is lo cated, and
4.13.10.2 Where em issions contribute to a violation of a national Ambient Air Quality Standard in the area in which the new or modified Major S ource is located. 4.13.11 Offsets requir ed as a condition of an Authority to Construct or a Permit to Operate shall commence not later th an the date of initial operation of the new or modified emissions unit.
4.13.11.1 If the new or modified emission s unit is, in whol e or in part, a replacement for an existing emissions unit at the same stationary source, the APCO may allow a ma ximum of 90 days as a start up period for simultaneous operation of the existing emissions unit and the replacement em issions unit. 4.13.12 Nothing in this ru le shall be construed as requiring ERC used as NSR offsets to be disc ounted at time of use, exce pt for the addi tional offsets as required by Sectio ns 4.8, 4.13.3, and as described in Section 7.0.

SJVAPCD 2201 - 22 4/21/114.14 Ambient Air Qu ality Standards:
4.14.1 Emissions from a new or modified Stationary Source shall not cause or make worse the violation of an Am bient Air Quality Standard. In making this determinati on, the APCO shall take into account the increases in minor and secondary source emissions as well as the mitigation of emissi ons through offsets obtained pur suant to th is rule. Modeling used for the purposes of this rule shall be consistent with the requirements contained in the most recent edition of EPA's "Guideline on Air Quality Models " unless the APCO fi nds such model is inappropriate for use. After making such a finding, the APCO may designate an alternativ e model only after allowi ng for public comments and only with the c oncurrence of the ARB or the EPA.
4.14.1.1 At the di scretion of the APCO, a new or modified source which is not subject to the pub lic noticing requirements of Section 5.4 shall be exempted from the requirements of Section 4.14.1. 4.15 Additional Requi rements for new Major Sources a nd Federal Major Modifications
4.15.1 Alternative siti ng: For those sources for whic h an analysis of alternative sites, sizes, and production processe s is required under Section 173 of the Federal Clean Air Act, the app licant shall prepare an analysis functionally equiva lent to the requirements of Division 13, Section 21000 et. seq. of the Pu blic Resources Code. 4.15.2 Compliance by Other Owned, Operated, or Controlled Source: The owner of a proposed new Major Source or federal major modification shall demonstrate to th e satisfaction of the APCO that all major Stationary Sources owned or operate d by such person (or by any entity controlling, controlled by, or under common cont rol with such person) in California which are subject to emission limitations are in compliance or on a schedule for compli ance with all applicab le emission limitations and standards.
5.0 Administrativ e Requirements The administrative requirements of Sections 5.1 th rough 5.7, inclusive, shall be applied to all applications fo r a new or modified emissions unit except for power pl ants proposed to be constructed in the Distri ct and for which a No tice of Intention (NOI) or Application for Certification (AFC) has been accepted by th e California Energy Commission. For such power plants, the administrative re quirements of Sectio n 5.8 shall apply.

SJVAPCD 2201 - 23 4/21/115.1 Complete Application: The APCO sh all determine whether the application is complete not later than 30 days after recei pt of the applicati on, or after such longer time as both the applicant an d the APCO may agree. 5.1.1 If the APCO determines that the ap plication is not comp lete, the applicant shall be notified in wr iting of the decision sp ecifying the information required. Upon receipt of any resubmittal of the application, a new 30- day period to determine co mpleteness shall begin. 5.1.2 Completeness of an application or resubmitt ed application shall be evaluated on the basis of the informa tion requirements set forth in the District Rules and Regulations as they exist on the date on which the application or resubmitted application is received. 5.1.3 Upon determination th at the application is co mplete, the APCO shall notify the applican t in writing. 5.1.4 The APCO may, during the processi ng of the applicati on, request an applicant to clarify, amplify, correct, or otherwise supplement the information submitted in the application. 5.2 Preliminary Decisi on: Following acceptance of an application as complete, the APCO shall perform the evaluations requi red to determine compliance with this rule and make a preliminary written de cision as to whethe r an Authority to Construct should be appr oved, conditionally appr oved, or disapproved. 5.2.1 The APCO shall deny a ny Authority to Construct if the APCO finds that the subject of the application would not comply with the standards set forth in this rule or any other District rule.
5.2.2 The decision shal l be supported by a succ inct, written analysis.
5.3 Final Action: With in 180 days afte r acceptance of an application as complete, or within 180 days after th e lead agency has approved th e project under the California Environmental Quality Act, wh ichever occurs later, the APCO shall take final action on the application after consider ing all written comments.
5.4 Public Notification and Publication Require ments: The APCO shall provide public notification a nd publication for th e following types of applications: 5.4.1 New Major Sources, Federal Major Modifica tions, and SB 288 Major Modifications. 5.4.2 Applications which in clude a new emissions unit w ith a Potential to Emit greater than 100 pounds duri ng any one day for any one affected pollutant;

SJVAPCD 2201 - 24 4/21/115.4.3 Modifications that in crease the Stationary So urce Potential to Emit (SSPE1) from a level below the emission s offset threshold level to a level exceeding the emissions offset threshol d level for one or more pollutants; 5.4.4 New Stationary Sources with post-pro ject Stationary Source Potential to Emit (SSPE2) exceeding the emissions offset threshold level for one or more pollutants; 5.4.5 Any permitting ac tion resulting in a Stationary Source Project Increase in Permitted Emissions (S SIPE) exceeding 20,000 pounds per year for any one pollutant.
5.5 Public Notification and Publication Actions: For the types of app lications listed in Section 5.4, the APCO shall pe rform the follow ing actions: 5.5.1 Within ten (10) cal endar days following the preliminary decision the APCO shall publish in at least one newspape r of general circulation in the District a notice stating the prelim inary decision, noting how pertinent information can be obtain ed, and inviting written public comment for a 30 day period following the date of publication.
5.5.2 No later than the da te of publication, the APCO shall transm it to the applicant its preliminary written decision, the anal ysis, and a copy of the notice submitted fo r publication.
5.5.3 No later than the da te of publication, the APCO shall transmit to the ARB and to any person w ho requests such in formation, its preliminary written decision, the analys is, and a copy of the notice submitted for publication. For new Major Sources, Federal Major Modifica tions, and SB 288 Major Modifications, the APCO shall also transmit the preliminary written decision and supporting doc uments to the EPA.
5.5.4 No later than the time the notice of the prel iminary decision is published, the APCO shall make ava ilable for public inspection at the District office the information submitted by th e applicant and the analysis.
5.5.5 The APCO shall provide written notice of the final action to the applicant, and the ARB, and shall publish such notice in a newspaper of general circulation, except that for an application not subject to Section 5.4, the APCO shall not be subject to this sect ion. In such a case, the applicant shall receive notification as provide d in Rule 2040 (Applications). For new Major Sources, Federal Major Modifications, and SB 288 Major Modifications, the APCO sh all also transmit wri tten notice of the final action to the EPA.

SJVAPCD 2201 - 25 4/21/115.5.6 No later than the tim e of notice of final actio n is published, the APCO shall make availabl e for public inspection at the District offi ce a copy of the notice submitted for publicati on and all suppor ting documents. 5.6 Authority to Construct (A TC) - General Conditions
5.6.1 An ATC shall not be issued unless the new or modified source complies with the provisions of th is rule and all ot her applicable District Rules and Regulations. 5.6.2 An ATC shall require that the new or modified source be built according to the specifications and plans contained in the application.
5.6.3 An ATC shall include all thos e conditions which the APCO deems necessary to assure construction an d operation in the manner assumed in making the analysis to determine compliance with this rule.
5.6.4 An ATC shall in clude all those conditions relating to the satisfaction of the offset requi rements of this rule.
5.6.5 An ATC issued for an emissions unit that relies on reduction in emissions from other units included in the Stationary Source Project, must include a condition that requires initiating an d completing construction on those units that provide the re duction prior to commenci ng operation of the unit with increase in emissions.
5.6.5.1 If the new or modi fied emissions unit is, in whole or in part, a replacement for an existing emissi ons unit at the sa me stationary source, the APCO may allow a ma ximum of 90 da ys as a start up period for simultane ous operation of th e existing emissions unit and the replaceme nt emissions unit. 5.7 Permit to Operate (P TO) - Genera l Conditions 5.7.1 A PTO shall requ ire that the new source or m odification be operated in the manner assumed in making the analysis to determine compliance with this rule and as conditioned in th e Authority to Construct.
5.7.2 A PTO shall include daily emissions limitation s and other enforceable conditions which reflect applicable emis sion limits including the offset requirements.
5.7.3 The APCO shall determine if the applicant has compli ed with all the conditions in the ATC. The APCO may allow conditions which have not been met at the time the PTO is issued to be inco rporated into the Permit to Operate, provide d that compliance w ith that condition is demonstrated by a specified date.

SJVAPCD 2201 - 26 4/21/115.7.4 Any source whic h provides offsets shall be su bject to enforceable permit conditions containing specif ic operational and emis sions limitations, which ensure that the emissions reductions will be provided in accordance with the provisions of this rule and shall continue for the reasonably expected life of the proposed source. Where the s ource of offsets is not subject to a permit, a written contract shall be required between the applicant and the owner of such source, wh ich contract, by its terms, shall be enforceable by the APCO. The permit a nd contract shal l be submitted to the ARB to be forwarded to th e EPA as part of the State Implementation Plan. A violation of the emission limitation provision s of any such c ontract shall be chargeable to the applicant. 5.7.5 Offsets required as a condition of an ATC or a PTO shall commence not later than the date of initial operation of the new or modified source,
5.7.5.1 If a new or modified Stationary Source is, in whole or in part, a replacement for an ex isting Stationary S ource on the same or contiguous property the APCO may allow a ma ximum of 90 days as a start up period for simultaneous operation of the existing Stationary Source and the new or replace ment source. 5.8 Power plants which will be licensed by the California Ener gy Commission: The administrative requirements of this secti on shall be applied to all power plants proposed to be constr ucted in the Distri ct and for which a Notice of Intention (NOI) or Applicati on for Certification (AFC) has been accepted by the California Energy Commission. The APCO may ap ply for reimburseme nt of all costs incurred, including lost fees, in order to comply with the provisions of this section. 5.8.1 Intent to Participate and Preliminary Report: With in 14 days of receipt of a NOI, the APCO shall notify the ARB and the California Energy Commission of the APCO's intent to participate in the NOI proceeding. If the APCO chooses to participate in the NOI proceeding, the APCO shall prepare and submit a report to th e ARB and the California Energy Commission prior to the conclusi on of the nonadjudicatory hearings specified in Section 25509.5 of the P ublic Resources Co de. The report shall include at least: 5.8.1.1 A preliminary specific definition of BACT for the proposed facility. 5.8.1.2 A preliminary discussion of whether there is substantial likelihood that the require ments of this rule a nd all other District rules can be satisfied by the proposed facility.

SJVAPCD 2201 - 27 4/21/115.8.1.3 A preliminary list of conditions which th e proposed facility must meet in order to comply with th is rule or any other applicable District rules. The preliminary determinations c ontained in the report shall be as speci fic as possible within the constraints of the information contained in the NOI. 5.8.2 Equivalency of Application for Certificati on to Application for Authority to Construct: The APCO shall consid er an Application for Certification (AFC) to be equivalent to an application for an Authority to Construct, and subject, as such, to all definitions and requ irements of this rule. 5.8.3 Upon receipt of an AFC for a pow er plant, the APCO shall conduct a Determination of Compliance review. This review shall determine whether an AFC is complete, and within 20 calendar days of receipt of the AFC, the APCO shall so inform th e California Ener gy Commission and the applicant in writing.
5.8.3.1 If the APCO determines that the application is not complete, the information required shall be specified, and the AFC shall be returned to the applicant for re submittal. Upon receipt of any resubmittal of the application, a new 20 day peri od to determine completeness shall begin. 5.8.3.2 Completeness of an application or re submitted application shall be evaluated on the ba sis of the informat ion require ments set forth in District Rules and Regula tions as they ex ist on the date on which the application or resubm itted application is received. 5.8.4 The APCO may request from the ap plicant any informat ion necessary for the completion of the Determination of Compliance review. If the APCO is unable to obtain the information, the APCO ma y petition th e presiding Commissioner of the California Energy Commissi on for an order directing the applicant to suppl y such information. 5.8.5 Within 180 days of accepting an AFC as complete, the AP CO shall make a preliminary written decision as to whether a Determination of Compliance Certification should be appr oved, conditionall y approved, or disapproved. The APCO shall de ny any Determination of Compliance Certification if the APCO finds that the subject of the application would not comply with the standards set forth in this rule or any other District rule. The decision shal l be supported by a succin ct, written analysis.
5.8.6 Notification and Pub lication actions shall be conducted according to the requirements of Section 5.5.

SJVAPCD 2201 - 28 4/21/115.8.7 Within 240 days af ter acceptance of an application as complete, the APCO, after considering all written co mments, shall take final action on the application, whic h action shall consist of the following: 5.8.7.1 The APCO, if all requirements of this rule are met, shall issue and submit to the Califo rnia Energy Commission a Determination of Comp liance, or advise th e Commission that a Determination of Compli ance cannot be issued. 5.8.7.2 Public insp ection of final action docume nts shall be provided for in accordance with Section 5.5.6 5.8.8 Equivalency of Determination of Compliance to Authority to Construct: A Determination of Complian ce shall confer the same rights and privileges as an Authority to Construct pr ovided that the California Energy Commission approves the Application for Certif ication and the certificate granted by the Commission includes all conditions of the Determination of Compliance.
5.8.9 The APCO shall issue a Permit to Operate to any applicant receiving a certificate from the California Ener gy Commission pursuant to this rule provided that the construc tion or modificati on is in compliance with all conditions of the certific ate and of the Determinat ion of Comp liance, and provided that the Permit to Operate includes the conditions prescribed in Section 5.7.
5.9 Enhanced Administ rative Requirements Application for a certificate of conformity with the procedural requirements of 40 CFR Part 70 shall be s ubject to the following enhanced administrative requirements in additi on to any other appl icable administrati ve require ments of Section 5.0:
5.9.1 New Sources a nd Significant Perm it Modifications
5.9.1.1 Public Notificatio n: The APCO sh all provide a wr itten notice of the proposed permit and, upon re quest, copies of the APCO analysis to interested parties. Interested parties shall include affected states, ARB and persons who have reques ted in writing to be notified. The notice shall also be given by publication in a newspaper of general circulation in the District and by any other means if necessary to assure ad equate notice to the affected public. The publi c shall be give n 30 days from the date of publication to submit written comments on th e APCO's proposed action.

SJVAPCD 2201 - 29 4/21/115.9.1.2 The notice shall provide the following information: 5.9.1.2.1 The identification of th e source, the na me and address of the permit holder, the activities and emissions change involved in the permit action;
5.9.1.2.2 The name and address of the APCO, the name and telephone number of District staff to contact for additional information;
5.9.1.2.3 The availabi lity, upon request, of a statement that sets forth the legal and factua l basis for th e proposed permit conditions;
5.9.1.2.4 The location wher e the public may inspect the Complete Application, the APCO's analysis, the proposed permit, and al l relevant supporting materials;
5.9.1.2.5 A statement that th e public may s ubmit written comments regarding the pr oposed decision within at least 30 days from the date of publication and a brief description of commen ting procedures, and
5.9.1.2.6 A statement that members of th e public may request the APCO or his designee to preside ov er a public hearing for the purpose of receiving oral public comment, if a hearing has not already been scheduled. The APCO shal l provide notice of any public hearing scheduled to address th e proposed decision at least 30 days prior to such hearing; 5.9.1.3 The APCO shall pr ovide written response to persons or agencies that submitted written comments which are postmarked by the close of the public notice and comment period. All written comments and response s to such comments shall be kept on file at the District office and made availabl e upon request. 5.9.1.4 A copy of the Co mplete Application, th e APCO's analysis and the proposed permit sha ll be made available at District offices for public review and comment durin g normal business hours. The APCO's analysis shall include a st atement that sets forth the legal and factual basis for the propos ed permit conditi ons, including references to the applicable stat utory and regulato ry provisions.

SJVAPCD 2201 - 30 4/21/115.9.1.5 The APCO shall provide wr itten notice to the EPA of the proposed decision along with copies of the propos ed permit, the APCO's analysis, th e public notice submitt ed for publication, and all necessary suppor ting information. 5.9.1.6 If the EPA does not object pursuant to Section 5.9.1.9, the APCO shall issue the final permit.
5.9.1.7 If the EPA does not object in writing to the APCO's preliminary decision during the EPA's 45 day review period, any person may petition the EPA within 60 days after the e xpiration of the EPA's 45 day review period. Any such petition sh all be based only on objections to the permit that were raised w ith reasonable specificity during the public comment period, unless the petitioner demonstrates to the EP A that it was impracticable to raise such objections within such period, or unless grounds for such objections arose af ter such period. Petitions shall be based on the compliance of the permit provisions with applicable requirements.
5.9.1.8 Within 180 da ys after acceptance of an application as complete, or within 180 days afte r the lead agency ha s approved the project under the California Environmental Quality Act, whichever occurs later, the APCO shall take final action on the application after considering all written comments.
5.9.1.9 The APCO shall not issue a permit if the EPA objects to its issuance in writ ing within 45 days of receipt of the APCO's notice of prelimin ary decision on the proposed permit. 5.9.1.9.1 Any EPA obj ection shall include a statement of the EPA's reasons for objection and a description of the terms and conditions that th e permit must include to respond to the objections. The EPA shall provide the permit applicant a c opy of the objection. 5.9.1.9.2 If the APCO fails, with in 90 days after the date of EPA's objection, or within 180 days from the date the application was deemed comp lete plus a ny extension allowed by the state law, whichever is sooner, to revise and submit a propos ed permit in response to the objection, the APCO sha ll not issue a certification on conformity to Title V. 5.9.1.9.3 If the EPA obj ects to the permit as a result of a public petition, the APCO shall not issue the permit until

SJVAPCD 2201 - 31 4/21/11EPA's objection has been re solved, except that a petition for review does not st ay the effectiveness of a permit or its requirements if the permit was issued after the end of th e 45-day review pe riod and prior to an EPA objection. If the APCO has issued a permit prior to receipt of an EP A objection, the EPA will modify, terminate, or revoke such permit , and shall do so consistent with proce dures in Section 70.7(g)(4) or (5)(i) and (ii) of th e 40 CFR regulations, and the APCO may thereafter reissue only a revised permit that satisfies EP A objection. 5.9.1.9.4 EPA objection shall be limited to compliance with applicable require ments and the re quirements of 40 CFR Part 70.
5.9.2 Minor Permit Modifications 5.9.2.1 Within 5 working days af ter the receipt of a Complete Application for a minor permit modification, th e APCO shall provide notification of the propos ed permit modi fication to the EPA, affected states, and interest ed parties pursuant to Section 5.9.1.1.
5.9.2.2 The APCO shall not issue a final permit modification until after a 45-day period review of the proposed permit modification by EPA or until EPA has notified the APCO that EPA will not object to issuance of the permit mo dification, whichever is first. 5.9.2.3 Within 90 days after APCO's receipt of an application for a minor permit modificati on or 15 days after the end of the EPA's 45-day review, whic hever is later, the APCO shall do one of the following:
5.9.2.3.1 Issue the permit as proposed;
5.9.2.3.2 De ny the permit modifi cation application;
5.9.2.3.3 Determine that the requested modification does not meet the minor permit m odification criteria and should be reviewed pursuant to th e administrative requirements for significant permit modifications; or
5.9.2.3.4 Revise the draft permit modifica tion and transmit the new proposed permit modifi cation to EPA and the affected states.

SJVAPCD 2201 - 32 4/21/116.0 Certification of Conformity A new or modified source subject to the requirements of Rule 2520 may choose to apply for a certificate of conformity with the proc edural requirements of 40 CFR Part 70. A certification of confor mity will allow changes authorized by the Authority to Construct to be incorporated into the Part 70 permit as administrative permit amendments.
6.1 The APCO will issue a written certifi cate of conformity w ith the procedural requirements of 40 CF R 70.7 and 70.8, and with the compliance requirements of 40 CFR 70.6(8)(c), if the fo llowing conditio ns are met: 6.1.1 The Authority to Cons truct is issued in conformance with the Enhanced Administrative Requireme nts of this rule;
6.1.2 The content of the Authority to Construct issued by the APCO complies with the requirements set forth in Section 9.0 of District Rule 2520 (Federally Mandated Operating Permits); 6.1.3 An application for a ce rtificate of conformity with the requirements of 40 CFR Part 70 is subm itted with the application fo r Authority to Construct. The content of applicati on for the certificate of conformity must comply with the requirements of Sections 7. 1 of District Rule 2520 (Federally Mandated Operating Permits); 6.1.4 The Authority to Cons truct contains a statement of conformity with the requirements of Title V and 40 CFR Part 70; 6.1.5 EPA has not objected to the issuance of the Au thority to Construct, or EPA's objections have been resolv ed to the satisfaction of EPA administrator; and
6.1.6 The Part 70 operating permit bei ng issued will cont ain the federally enforceable requirements contained in the Authority to Construct.
6.2 The certificate of c onformity with the pr ocedural requirements of 40 CFR Part 70 is valid as long as th e Authority to Construct with wh ich it was issued is valid.
6.3 Modifications to an Aut hority to Construct for which a certificate of conformity has been issued are subject to the admini strative requirements of Section 11.0 of District Rule 2520 that apply to permit modi fications and change s, as well as the requirements of all Di strict Rules that a pply to modifications of Authorities to Construct.

SJVAPCD 2201 - 33 4/21/117.0 Annual Offset Equivalenc y Demonstration and Pre-ba seline ERC Ca p Tracking System 7.1 Offset Tracking System The APCO shall implement a system for tracking the fo llowing for each permitting action: 7.1.1 The quantity of offsets that w ould have been requ ired for new major sources and federal major modifications in the Dist rict had the federal new source review requ irements, codified in 40 CFR 51.165, and Title I part D of the Clean Air Act (CAA), been applied to these sources. These requirements include offsetting the full emission s from new major sources, using actual emissions ba selines when required under 40 CFR 51.165, and providing offsets necessary to meet th e CAA offset ratio requirements and provide a net air qua lity benefit. 7.1.2 The quantity of offset s actually required for al l new and modified sources in the District pursuant to the requir ements of this rule, and, for the purposes of the Pre-baseli ne ERC Cap Tracking Sy stem outlined in any District-adopted and EPA- approved attain ment plan. 7.1.3 The surplus value of creditable emission reductions used as offsets by stationary sources. 7.1.3.1 The surplus valu e shall be determined at the time of ATC issuance for the sources using the emission re ductions to satisfy offset requi rements of this rule.
7.1.3.2 The determin ation of surplus value shal l specify all requirements that apply to the o ffsets being reviewed, the methodology used to calculate the impact of these requirements, and all calculations performed in arriving at the final surplus value. 7.1.4 For purposes of the re quirements of Section 7.0, surplus value shall be defined as the quantity of actual em ission reductions ac hieved by a source in excess of the following requirements: 7.1.4.1 Any emission reduction required by a stand- alone federal requirement or regulat ion, including, but no t limited to, Acid Rain, New Source Performance Standard, Reasonably Available Control Technology, and Maximum Achievable Control Technology, whether or not the requirements ar e part of the State Implementation Plan (SIP) or a local attainment plan. 7.1.4.2 Any emission reduction relied upon by a permitting authority for

SJVAPCD 2201 - 34 4/21/11attainment purposes, such as through an attainment plan, including emission redu ctions relied upon for Reasonable Further Progress calculations. 7.1.4.3 Any emission redu ction achieved by shut ting down an existing source or curtailing pr oduction or operating hours below baseline levels whose original emission is not included in the District’s emission inventory. 7.1.4.4 Any emission re duction based on a source -specific or source category-specific SI P provision used to comply with CAA requirements. 7.1.4.5 Any emission redu ction required by a condition of a permit issued to comply with CAA New Source Review requirements, except that any emission re duction required by a permit condition, which was placed on a permit so lely to assure compliance with a state or local re quirement, which is not on its own federally enfo rceable, shall not be in cluded in this class. 7.1.4.6 Any emissi on reduction based on a source-specific emission limitation resulting from an EPA enforcement case. 7.1.5 For purposes of the requirements of Section 7.0, cr editable shall be defined as emission reductions are real , surplus, quantifia ble, enforceable and permanent. The creditability of a given emission reduction may be subject to review by the EPA. 7.2 Annual Demonstration Report The APCO shall annually prepare a report with the following demonstrations to be provided to th e public, the ARB and the EPA in accordance with the dates specified in Section 7.3. The District sh all also make available to the public, the ARB and the EPA the data used to prepare the demonstrations.
7.2.1 Demonstration on Equivalency of Offset Requirements 7.2.1.1 The report shall include a co mparison of the an nual quantity of federal offsets that would ha ve been required (as tracked pursuant to Section 7. 1.1) to the annual quantity of offsets actually required under this rule , including any excess offsets required from previous reporting years (as tracked pursuant to Section 7.1.2). 7.2.1.2 The report shall also describe any additional em ission reductions retired to address a sh ortfall in required offs ets as specified in

SJVAPCD 2201 - 35 4/21/11Section 7.4.1.1. Such description shall, at a minimum, specify the emission reductions used and the surplus value of those reductions. The surplu s value of these reduc tions may also be used in demonstrating equi valency under section 7.2.2
7.2.2 Demonstration on Creditab ility of Emission Reductions 7.2.2.1 The report shall include a co mparison of the an nual quantity of federal offsets that would ha ve been required (as tracked pursuant to Section 7. 1.1) to the surplus value of creditable emission reductions used as offs ets during the ye ar (as tracked pursuant to Section 7.1.3). 7.2.2.2 For purposes of the demonstrati on described in Se ction 7.2.2, the comparison may also include th e surplus value of additional creditable emission reductions that have not been used as offsets and have been banked or have been gene rated as a result of permitting actions. The surplus value of these reductions may also be used to remedy any shor tfall as specified under Section 7.4.1.1. 7.2.2.2.1 The surplus value of these additional credits shall be determined as of the date of the issu ance of the Authority to Construct uti lizing such re ductions in demonstration de scribed in this subsection. 7.2.2.2.2 Any such a dditional emission reductio ns used in this demonstration shall be perm anently retired and shall not be used to meet any offset or ne tting requirements and shall not be used in future demonstrations required by Se ction 7.0.
7.2.2.2.3 Addi tional emission reductions descri bed in Section 7.2.2.2 shall only be includ ed in the comparison to the extent the annua l quantity of fede ral offsets that would have been required (as tracked pursuant to Section 7.1.1) exceeds the surplus value of creditable emission reductions used as offsets (as tracked pursuant to Section 7.1.3). 7.2.2.2.4 Any additi onal emission reducti ons described in Section 7.2.2.2 that ar e not included in the demonstration requi red by this subsection, may be used in future de monstrations in accordance with this subsection.

SJVAPCD 2201 - 36 4/21/117.3 Reporting Schedule 7.3.1 The report shall cove r the period August 20 to A ugust 19 of each year. For the Initial report, the District shall track offs et requirements for new and modified sources for which a complete applic ation for Authority to Construct was submitted after Augus t 20, 2001. Additi onal emission reductions, other than banked emission re ductions, may be used in the equivalency demons tration only if the reduction occurred after August 20, 2001 7.3.2 For each reporti ng period, the APCO shall submit th e report and data described in Section 7.2 to ARB and the EPA no la ter than N ovember 20 of each year. In addition, the APCO shall rel ease the report to the public and shall present it to the District Governing Board, each year, at the first Board meeting following it s submittal to the EPA.
7.3.3 All documents create d and/or used in implem enting the requirements of Section 7.0 shall be kept and maintained by the APCO for no less than five years from the date of their creation and/or use. 7.4 Remedy for Emission Offset Shortfalls 7.4.1 Failure to Demonstrate Equivalency in Offset Requirements 7.4.1.1 If the comparison described in Se ction 7.2.1 does not show, or EPA determines the comparison erroneously shows, that the annual quantity of offs ets actually required under this rule (as tracked pursuant to Se ction 7.1.2) equals or exceeds the annual quantity of federal of fsets that would have been required (as tracked pursuant to Section 7.1. 1), the District shall retire additional creditable emis sion reductions that have not been used as offsets and have been banked or have been generated as a result of permitting actions such that the surplus value of these emission reductions sati sfies any shortfall. 7.4.1.1.1 The surplus value of these additional credits shall be determined as of the date of the issu ance of the Authority to Construct uti lizing such re ductions in demonstration de scribed in this subsection. 7.4.1.1.2 Any such a dditional emission reductio ns used in this demonstration shall be perm anently retired and shall not be used to meet any offset or ne tting requirements and shall not be used in future demonstrations required by Se ction 7.0.

SJVAPCD 2201 - 37 4/21/117.4.1.2 If the District does not have sufficien t additional creditable emission reductions to sa tisfy the shortfall de scribed in 7.4.1.1, all ATCs issued after the report deadline for that year shall comply with the offset require ments of 40 CFR 51.165, and part D of Title I of the CA A, for each pollutant for which there is a shortfall, until the applicability and offset requirements of this rule are revised to comply with the federal new source review requirements and approved into the SIP by EPA.
7.4.1.3 If the APCO fails to submit a report meeting the requirements of Section 7.2.1, all ATC issued af ter the report de adline and until the APCO submits to ARB, EPA and the public a report complying with the requirements of Section 7.2. 1 shall comply with the offset requirements of 40 CFR 51.165, and part D of Title I of the CAA. 7.4.2 Failure to Demonstrate Adequa te Creditable Emis sion Reductions 7.4.2.1 If the comparison described in Se ction 7.2.2 does not show, or EPA determines the comparison erroneously shows, that the surplus value of creditable emissi on reductions used as offsets during the year (as tr acked pursuant to Sect ion 7.1.3) combined with additional emission reductio ns as described in Section 7.2.2.2 equals or exc eeds the annual quantity of federal offsets that would have been required (as tracked pursuant to Section 7.1.1), all ATCs issued, for new major sources or federal major modifications, for each pollutant for which th ere is a shortfall, after the report deadline shall ensure that emission reductions used to satisfy offset requirements are creditable and that the surplus value of those credits is determined at the time of ATC issuance. 7.4.2.2 The requireme nts of Section 7.4.2.1 shal l remain in effect until this rule is revised to require offset discount ing at time of use and such revision is a pproved into the SIP by EPA, or until a subsequent annual repo rt prepared in accor dance with Section 7.2.2 demonstrates that the surplus value of creditable emission reductions used as offsets (as tr acked pursuant to Section 7.1.3) combined with additional emission reductions as described in Section 7.2.2.2 equals or exceed s the annual quan tity of federal offsets that would ha ve been required (as tracked pursuant to Section 7.1.1).
7.4.2.3 If the APCO fails to submit a report meeting the requirements of Section 7.2.2, all ATCs issued for new major sour ces or federal major modifications after the repor t deadline and until the APCO

SJVAPCD 2201 - 38 4/21/11submits to ARB, EPA and the public a report complying with the requirements of Sect ion 7.2.1 shal l ensure that emission reductions used to satisfy offset requirements are creditable and that the surplus value of those cred its is determined at the time of ATC issuance.
7.5 Pre-Baseline ERC Us age Caps from District Attainment Plans
7.5.1 ERCs that were banked prior to the baseline year for a given Districtadopted and EPA-approved Attainment Plan shall no t be used to offset emissions increases under th e provisions of this rule if the usag e of such credits during the effectiv e period of the plan exceeds the respective pollutant’s Pre-Baseline ERC Usage Cap in the plan. 7.5.2 Such caps on pre-baseline ERC usag e remain in effect until the end of the plan’s effective period, or until such time as EPA approves revised caps through an Attainment Plan revision process or a Rate of Progress update. 8.0 Application Shield for Routine Replacement 8.1 For a Routine Replacement for which an Authority to Construc t is required, the permitted source may contin ue to operate under an a pplication shield, provided that all of the follow ing conditions are met. 8.1.1 An application for the Routine Re placement has been submitted within seven calendar days of completing the routine replacement. 8.1.2 The source operates in compliance with all applic able requireme nts of the federal, state, and District rules and regulations. 8.2 When the application has been deemed complete by the APCO, the application shield shall be made effect ive retroactive from the date of application submittal until the application is e ither approved or denied, 8.2.1 The application shield is not applicable if the District's fi nal action is delayed due to the failure of the applicant to submit timely information requested by the District . The source must also submit additional information for any requir ements that become applicable after a complete application is submitted, but before a PTO is issued. 8.3 The application shield does not exempt the opera tor from any applicable requirements. 8.4 The application shield a pplies only to an applicati on for a Routine Replacement and does not authorize any increases to the pe rmitted throughput or emissions due to a change in de sign capacity as part of a Routine Replacement.

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