June 11,2015
Mr. Gerardo Rios USEPA Region IX 

### BAY 

## A R F A 75 Hawthorne Street, Mail Code: AIR-3

San Francisco, CA 94105 

### AIR Q~ALITY
MAN AG EM E NT Subject: EPA Approvability of BAAQMD Permitting Rules

DISTRICT Dear Mr. Rios,

ALA ~AB~I~NTY This letter is to address the following issues as they pertain to major facilities, prior
Margaret Fujioka to EPA making its formal determination to approve or disapprove our revised Scott Haggerty Regulation 2 Permitting Rules that were adopted by our Board of Directors on Dec.

19, 2012. These issues were raised for discussion during our meeting on April 28, CONTRA COSTA COUNTY 2015, at the District’s offices.

David Hudson Karen Mitchoff Construction-Related Activities Requiring an NSR Permit: The District’s Mark Ross Regulation 2, Rule 1, Section 301 (Reg. 2-1 -301) requires an Authority to

MARIN COUNTY Construct before an owner/operator “...puts in place, builds, erects, installs, Katie Rice modifies, modernizes, alters or replaces...” a source of air emissions. A question

NAPA COUNTY has been raised regarding whether an applicant can undertake certain preparatory Brad Wagenknecht or preliminary construction-related activities under this language before receiving
SAN FRANCISCO COUNTY its Authority to Construct for a project. In particular, a question has been raised as John Avalos to whether the District will allow physical on-site construction activities of a source Ed~n MM Lee or emissions unit that are of a permanent nature. The federal NSR program (Vice-Chair) implemented by EPA does not allow such permanent construction activities to

SAN MATEO COUNTY begin prior to receipt of an NSR permit. To the extent that the District allows such David J. Canepa construction before receipt of the Authority to Construct (i.e., NSR permit), that Carole Groom would be less stringent than the minimum federal NSR requirements.

SANTA CLARA COUNTY This letter is to confirm that the District will not allow any physical on-site Cinyavez construction-related activities of a permanent nature under District Regulation 2-1-
(Secretary) 301. In particular, the District will not allow any of the following specific activities

prior to receipt of the Authority to Construct for a project:

SOLANO COUNTY Prohibited pre-construction activities: James Spering • Installation of building supports and foundations;

SONOMA COUNTY

. Paving Teresa Barrett Shirlee Zane

. Laying of underground pipe work;

. Construction of permanent storage;

Jack P. Broadbent • Other activity of a similar permanent nature. EXECUTIVE OFFICERIAPCO Implementing Regulation 2-1-301 in this manner will ensure that the District’s NSR

program is at least as stringent as the minimum federal NSR requirements.
The District will implement this interpretation of Regulation 2-1-301 starting immediately. The District will also develop an Engineering Division policy memorandum, which will be posted on the District’s website, in order to ensure this

939 ELLIS STREET • SAN FRANCISCO CALIFORNIA 94109 • 415.771.6000

. www.baaqmd.govMr. Gerardo Rios June 11,2015 Page 2
interpretation is followed by District permitting staff and is understood by the regulated community.
Clean Air Act 110(I) Analysis: As agreed in our meeting, we have enclosed two documents pertaining to the 110(l) analysis that we conducted as part of the rule development efforts for the Regulation 2 revisions. The CAA 110(l) Analysis document is also available on the District website, along with other documents pertaining to the Regulation 2 revisions, at: http:I/www. baagmd.qov/Divisions/Engineer-inq/Proposed-Reg-2-Changes.as~x
We appreciate EPA staff’s willingness to work with us to resolve these potential approvability issues prior to making their official determination. We look forward to continuing to work with you to address any additional deficiencies. Very truly yours,

Jim Karas, P.E. Director of Engineering

JK:gas

Enclosures: Analysis of Compliance with 4OCFR Section 51.160 (a) & (b); and

CAA Section 110(I) Analysis of BAAQMD Permit Exemption Provisions in Regulation 2, Rule I

cc: Laura Yannayon, US EPA Region IX

### BAY AREA AIR Q~AUTY



### _______ MANAGEMENT

DISTRICT



### ANALYSIS OF COMPLIANCE WITH 

# 40 C.F.R. SECTION 

# 5 1.160(A) & (B)

BY

CAROL 

### LEE, SENIOR AIR QUALITY ENGINEER

REVIEWED BY

BRENDA CABRAL, SUPERVISING AIR QUALITY ENGINEER



### AUGUST 

# 2012

### Table of Co ents

Preventing Violations of Control Strategy 3 Preventing Interference with Attainment or Maintenance of NAAQS 3 Ozone 3 PM10 and PM25~ 5 NO2~ 7 SO2~ 8 CO~ Lead’ 10Analysis of Compliance with 40 C.F.R. §~ 160(a)&(b)

40 C.F.R. Sections 160(a) and 160(b) require that the SIP must include provisions that will prevent permitted sources from (1) violating any portion of the region’s Control Strategy and (2) interfering with attainment or maintenance of any NAAQS. Section 160(a) requires that the SIP have provisions for the District to determine whether any such source will cause such a violation or interference; and Section 160(b) requires that the SIP have provisions for the APCO to deny a permit for a source that will cause such a violation or interference. These requirements apply to the entirety of the District’s NSR program, not just the “Major NSR” elements that are subject to 40 C.F.R. Sections 165 (for non-attainment pollutants) and 166 (for attainment/unclassified pollutants). The District’s NSR program under the Proposed Amendments will fully satisfy these requirements, as explained below.



### reventng Violations of Control Strategy: The District’s review of permit applications under its NSR program will ensure that no new or modified source (of any size) will violate any portion of the District’s Control Strategy. The District’s permit review process

— applicable to all Authorities to Construct for all new and modified sources at all facilities regardless of size

— involves a thorough review all applicable air quality regulatory requirements to ensure that the new/modified source will comply. If this review shows that there will be a violation of any such requirement (which includes all elements of the District’s control strategy under the SIP), then the District will deny the permit. This denial authority is set forth in Regulation 2-1-304 (Denial, Failure To Comply With Applicable Requirements).


### Preventing n erfe e ce with Attainment o Maintenance of NAA S: The District’s NSR review requirements will also ensure that no new or modified sources for which NSR permits are issued will interfere with attainment or maintenance of any NAAQS. Several aspects of the District’s NSR program combine to ensure this result. The discussion below addresses each of the NAAQS in turn. 

### Ozone: EPA’s current NAAQS for ozone is 75 ppm, averaged over 8 hours. The Bay Area is currently designated as non-attainment of this standard. To address this situation, the Bay Area 2010 Clean Air Plan (CAP)1 provides a comprehensive plan to improve Bay Area air quality and protect public health. The 2010 CAP has been prepared in close collaboration with the Air

‘Bay Area 2010 Clean Air Plan, September 15, 2010. 3District’s regional agency partners, and has been informed by extensive outreach to the public

and interested stakeholders.
Ozone is not emitted directly from pollution sources. Instead, ozone is formed in the atmosphere through complex chemical reactions in the presence of sunlight between two types of precursor chemicals: hydrocarbons, often referred to as “reactive organic gases” (ROG), and nitrogen oxides (NOx). Ozone is also a regional pollutant. Emissions of ROG and NOx throughout the Bay Area contribute to ozone formation. Because emissions in one part of the region can impact air quality miles away, efforts to reduce ozone levels focus on reducing emissions of ROG and NOx throughout the region.

There are literally millions of sources of ozone precursors in the Bay Area, including industrial and commercial facilities, motor vehièles, and consumer products such as household cleaners and paints. Even trees and plants produce ozone precursors. The main sources of ROG emissions in the Bay Area are motor vehicles and evaporation of solvents, fuels and other petroleum products. The main sources of NOx are motor vehicles and combustion at industrial and other facilities. The Bay Area annual average emission inventory for ozone precursors, ROG and NOX is presented in Table 2-3 in Volume I of the 2010 CAP2.

The inventory and projections are based upon CARB EMFAC 2007, Version 2.3 and reflects the effect of regulations adopted as of December 31, 2006. The inventories do not include additional emissions reductions from State or federal measures adopted since 2007 or CARB’s “Pavley regulations” to reduce greenhouse gases from motor vehicles.

Stationary Sources* Grand Total Emissions

* Stationary Sources include: lndustrial/Corhmercial Processes, Other Industrial/Commercial Processes, Combustion

— Stationary Sources, Burning of Waste Materials, Banked Emissions, and Alternate Compliance Allowance. Banked Emissions are current emission reduction credits in the District’s emission banking program that may be used in the future to offset future emission increases. Alternate Compliance Allowance are surplus emissions, voluntarily, reduced, available for alternative compliance with BARCT requirements of selected rules, as prescribed by State Law and BAAQMD Regulation 2, Rule 9.

The District’s CAP allow for a certain amount of growth in stationary sources (i.e., sources permitted by the District under its NSR program). Furthermore, per Regulation 2-2-302, ROG and NOx offsets will be required for facilities with increases over 10 TPY, and any increase at all for facilities above this threshold, which is far lower than what is required under the federal CAA. There is not yet a PSD modeling methodology for ozone. Hence, there is no proposal to

2 BAAQMD Bay Area 2010 Clean Air Plan, September 15, 2010.

Reactive Organic Gases (ROG)

4model ozone for minor sources. However, the thresholds for public noticing will ensure a

“backstop” requirement for those applications with significant increases in emissions of ROG and NOx. Issuing minor NSR permits for new and modified sources will not interfere with attainment and maintenance of the ozone NAAQS.


### PM10 and PM2.s: EPA has established three NAAQS for particulate matter: a 150 ~tg/m3 24-hour-average standard for PM10; and a 35 ~..tg/m3 24-hour-average standard and a 15 ~ig/m3 annual average standard for PM25.
The measured ambient air quality in the Bay Area is currently in compliance with all PM NAAQS. The Bay Area is administratively designated by EPA as being in attainment of the PM10 NAAQS and the annual-average PM2.5 NAAQS. From our monitoring network, the District’s monitoring network has detected the following concentrations of PM10 in the Bay Area:

2008: Maximum 24-hr: 77 ug/m3; Maximum annual average: 24.1 ug/m33 2009: Maximum 24-hr: 55 ug/m3; Maximum annual average: 20.4 ug/m34 2010: Maximum 24-hr: 70 ug/m3; Maximum annual average: 21.0 ug/m35

Hence, for PM10 the maximum 24-hr concentration is 51% of standard, while the maximum annual concentration is 17% of standard.
The Bay Area is currently designated by EPA as being non-attainment for the 24-hour average PM2.5 NAAQS, but an analysis of monitoring data over the past few years shows that as a factual matter 24-hour PM2.5 concentrations have been below the standard. The District has developed a comprehensive emissions inventory and report of the PM in the Bay Area6. The purpose of the report is to (1) fulfill federal air quality planning requirements for PM2.5, and (2) guide the Air District’s long-term efforts to analyze and reduce PM emissions and population exposure to PM in the Bay Area.
The breakdown of primary PM2.5 emissions by source category differs for the winter PM2.5 inventory compared to the annual inventory. The key difference is that PM2.5 emissions from residential fuel combustion account for 38% of the winter inventory versus 24% in the case of the annual inventory. PM2.5 emissions from residential fuel combustion, which is dominated by wood-burning in fireplaces and wood stoves, are 65% higher (an additional 7 tons per day) in the winter months than the annual emissions for this category. However, emissions from

~ BAAQMD Annual Bay Area Air Quality Summary, 2008.

~ BAAQMD Annual Bay Area Air Quality Summary, 2009.

~ BAAQMD Annual Bay Area Air Quality Summary, 2010.

~ BAAQMD Particulate Matter: Understanding PM to Protect Public Health in the Bay Area, August 2012.
5several source categories are lower in winter. For example, winter emissions from off-road

equipment, as well as from the industrial sector, are lower than annual average emissions due to reduced activity during the winter months. Accidental fires and geological dust emissions
are also lower in the winter than the annual average. Overall, however, winter-time PM2.5 emissions are 4% higher (an additional 2 tons per day) than annual-average emissions. The relationship between annual PM1O and winter PM1O is similar to that for PM2.5. The main difference is that emissions for residential fuel combustion (primarily wood-burning) increase from 11% of the annual PM1O inventory to 18% of the winter PM1O inventory, while emissions from accidental fires (primarily wildfires) decrease from 5% of the annual PM1O inventory to 1% of the winter PM1O inventory.
Annual average emissions of primary PM2.5 have decreased from an estimated 87 tons per day,
as reported in the 2010 CAP, to 47 tons per day, a decline of 46%. The revised inventory includes significant reductions in several major source categories, such as residential woodburning, commercial cooking, off-road vehicles (“Other Mobile Sources”), and road dust (included in “Geological dust”). This decrease in the inventory is based in part on real emission reductions due to factors such as turnover in the vehicle fleet and the impact of new regulations that had not been accounted for in previous emission factors. However, changes in methodologies used to estimate emissions also account for a significant portion of the decrease in the inventory. The estimated emissions provided in the inventory7 are based upon data from
source tests, published emission factors, and engineering calculations. Emission inventories are revised and improved on a regular basis. The current PM inventory7 differs significantly from the inventory provided in the 2010 CAP. This is due to the fact that, since the release of the 2010 CAP, ARB and Air District staff reviewed and improved the methodologies used to estimate emissions from several of the most important PM source categories, as explained below.
Future emissions projections for primary PM and PM precursors are based on estimated future trends in population growth and household formation, land use, economic activity, and motor vehicle travel. The projected inventory includes anticipated emission reductions from turnover in the motor vehicle fleet (whereby older, dirtier vehicles are replaced by newer, cleaner vehicles), and well as ARB and Air District regulations that have already been adopted. Implementation of ARB regulations on mobile sources is typically phased in, so the entire benefit of these adopted regulations will not be realized until they have been fully implemented over the next 10-15 years. At that point, emissions are projected to slowly increase in response to population and economic growth, if no additional regulations are adopted.

~ BAAQMD Particulate Matter: Understanding PM to Protect Public Health in the Bay Area, August 2012.
6Stationary

Sources* Grand Total Emissions

* Stationary Sources include: Industrial/Commercial Processes, Other Industrial/Commercial Processes, Combustion

— Stationary Sources, Burning of Waste Materials, Banked Emissions, and Alternate Compliance Allowance. Banked Emissions are current emission reduction credits in the District’s emission banking program that may be used in the future to offset future emission increases. Alternate Compliance Allowance are surplus emissions, voluntarily reduced, available for alternative compliance with BARCT requirements of selected rules, as prescribed by State Law and BAAQMD Regulation 2, Rule 9.
Overall, the projected inventory shows little change in total emissions of primary PM2.5 and primary PM1O from 2010 through 2030, based on the (unlikely) assumption that no future regulations or policies are adopted to further reduce emissions. As such, the projected emissions represent a “business as usual” scenario as to future emission levels. PM emissions from sources under District jurisdiction are projected to increase at a rate of around 1% per year based on previous observed growth and regulations adopted to date.
As with ozone above, the District is projecting an overall a decline in winter-time PM2.5 emissions (with a slight up-tick in 2030), which is expected to keep the Bay Area below the NAAQS. The District has also projected a certain amount of growth in stationary sources/industrial sources. Again, the slight up-tick in 2030 does not include the unlikely assumption that no future regulations or policies are adopted to further reduce emissions. In addition, for major sources, offsets for increases of PM10 and PM2.5 will be required. The thresholds for modeling and public noticing will ensure a “backstop” requirement to perform air quality modeling and public noticing for those applications with significant increases in emissions. Issuing minor NSR permits for new and modified sources will not interfere with attainment and maintenance of the PM2.5 and PM10 NAAQS.


### NOz: EPA’s current NAAQS for nitrogen dioxide is 0.1 ppm on an hourly basis and 0.053 ppm averaged over an annual average. The Bay Area is currently designated as in attainment of the annual average standard and unclassified for the hourly standard. To attain this hourly standard, the 3-year average of the 98th percentile of the daily maximum 1-hour average at each monitor within an area must not exceed 0.100 ppm (effective January 22, 2010). The latest inventory for NO2 (2008) is 449 tons per day and 163,890 tons per year8. Only 13%
comes from stationary sources (combustion), while 87% of the inventory is from motor vehicles8. The District has reviewed application data9 and determined that if all increases from

8 BAAQMD Base Year 2008 Bay Area Emissions Inventory Summary Report, May 2011.
7plants less than 40 tons were added together for each year for years 1991 to 2011 that the

averaged, annual total NO2 increase is 227 tons per year and ranges from 34 to 557 tons per year, which is only 0.02% to 0.34% of the total inventory. From our monitoring network, the District’s monitoring network has detected the following concentrations of NO2 in the Bay Area:

2008: Maximum 1-hr: 0.080 ppm; Maximum annual average: 0.017 ppm1° 2009: Maximum 1-hr: 0.069 ppm; Maximum annual average: 0.016 ppm1’ 2010: Maximum 1-hr: 0.093 ppm; Maximum annual average: 0.016 ppm’2

Hence, the maximum 1-hr concentration is 93% of standard, while the maximum annual concentration is 32% of standard. It is unlikely than even a significant increase in NO2will hurt the District’s continual attainment of the NAAQS for NO2. Furthermore, per Regulation 2-2-302, NO2 offsets will be required for facilities with increases over 10 TPY, and any increase at all for facilities above this threshold, which is far lower than what is required under the federal CAA. The thresholds for modeling and public noticing will ensure a “backstop” requirement to perform air quality modeling and public noticing for those applications with significant increases in emissions. Issuing minor NSR permits for new and modified sources will not interfere with attainment and maintenance of the NO2 NAAQS.


### SO2: EPA’s current NAAQS for sulfur dioxide is 75 ppb on an hourly basis, 140 ppb averaged over 24 hours, and 30 ppb over an annual average. The Bay Area is currently designated as in attainment of these standards. The latest inventory for SO2 (2008) is 82 tons per day and 29,930 tons per year’3. Approximately 48% comes from stationary sources, while 52% of the inventory is from motor vehicles’3. The District has reviewed application data’4 and determined that if all increases from plants less than 40 tons were added together for each year for years 1991 to 2011 that the averaged, annual total SO2 increase is 49 tons per year and ranges from 8 to 93 tons per year, which is only 0.027% to 0.311% of the total inventory. From
our monitoring network, the District’s monitoring network has detected the following concentrations of 502 in the Bay Area:

2008: Maximum 24-hr: 13 ppb; Maximum annual average: 2.1 ppb’5 2009: Maximum 24-hr: 7 ppb; Maximum annual average: 1.7 ppb16

~ BAAQMD Application Data from Years 1991 to 2012.

10 BAAQMD Annual Bay Area Air Quality Summary, 2008.

~‘ BAAQMD Annual Bay Area Air Quality Summary, 2009.

12 BAAQMD Annual Bay Area Air Quality Summary, 2010.

13 BAAQMD Base Year 2008 Bay Area Emissions Inventory Summary Report, May 2011.

14 BAAQMD Application Data from Years 1991 to 2011.

15 BAAQMD Annual Bay Area Air Quality Summary, 2008.
82010: Maximum 24-hr: 6.5 ppb; Maximum 1-hr: 37 ppb 17, 18

In 2010, the maximum 1-hr concentration is 49.3% of standard, while the maximum 24-hr concentrations is 49.3% of the annual standard. It is unlikely than even a significant increase in SO2 will hurt the District’s continual attainment of the NAAQS for 502. In addition, for major sources, offsets for increases of 502 will be required. The thresholds for modeling and public noticing will ensure a “backstop” requirement to perform air quality modeling and public noticing for those applications with significant increases in emissions. Issuing minor NSR permits for new and modified sources will not interfere with attainment and maintenance of the 502 NAAQS.


### CO: EPA’s current NAAQS for carbon monoxide is 35 ppm on an hourly basis and 9 ppm averaged
over 8 hours. The Bay Area is currently designated as attainment of this standard. The latest inventory for CO (2008) is 1723 tons per day and 628,900 tons per year13. Only 10% is from stationary sources (combustion), while 88% of the inventory is from motor vehicles (the remaining 2% is from consumer products/dust sources/fires)19. The District has reviewed application data2° and determined that if all increases from plants less than 100 tons were added together for each year for years 1991 to 2012 that the averaged, annual total CO increase is 351 tons per year and ranges from 50 to 804 tons per year, which is only 0.08% to 0.128% of the total inventory. From our monitoring network, the District’s monitoring network has detected the following concentrations of CO in the Bay Area:

2008: Maximum 1-hr: 5.7 ppm; Maximum 8-hr: 2.5 ppm15 2009: Maximum 1-hr: 4.6 ppm; Maximum 8-hr: 2.9 ppm16 2010: Maximum 1-hr: 3.0 ppm; Maximum 8-hr: 2.2 ppm’7
Hence, the maximum 1-hr concentration is 16% of standard, while the maximum 8-hr concentration is 32% of standard. It is unlikely than even a significant increase in CO will hurt the District’s continual attainment of the NAAQS for CO. The thresholds for modeling and public noticing will ensure a “backstop” requirement to perform air quality modeling and public noticing for those applications with significant increases in emissions. Issuing minor NSR permits for new and modified sources will not interfere with attainment and maintenance of the CO NAAQS.

16 BAAQMD Annual Bay Area Air Quality Summary, 2009.

17 BAAQMD Annual Bay Area Air Quality Summary, 2010.

18 Note that the form of the standard changed in 2010.

19 BAAQMD Base Year 2008 Bay Area Emissions Inventory Summary Report, May 2011.

20 BAAQMD Application Data from Years 1991 to 2011.

9

### Lead:

The Air District has been classified as “in attainment” for the pre-2008 lead standard of 1.5 ug/m3 and also the post-2008 lead standard. On November 12, 2008 EPA strengthened the NAAQS for lead. EPA revised the level of the primary (health-based) standard from 1.5 micrograms per cubic meter (ug/m3) to 0.15 ug/m3 and revised the secondary (welfare-based) standard to be identical in all respects to the primary standard. In conjunction with strengthening the lead NAAQS, the EPA promulgated new monitoring requirements including
new design requirements for the lead NAAQS surveillance network. Monitoring is now required for lead sources that may contribute to violations of the lead NAAQS and for large urban areas. The Bay Area does not have stationary sources with lead emissions that trigger the monitoring requirement. The final requirement sets the emission threshold for monitoring at stationary
sources at 0.50 tpy. However, the Bay Area does have three airports at which lead monitoring will be required on an experimental basis: Palo Alto and Reid-Hillview Airports in Santa Clara County, and San Carlos Airport in San Mateo County.

The following is the District’s 2009 inventory of stationary sources with lead emissions: LOCATION (Ibs/yr) FACILITY Alameda 2.57E+02 Owens-Brockway Glass Container Inc Alameda 1.31E+01 A B & I Foundry Alameda 1.24E+01 Ridge Foundry, Inc Alameda 6.77E+00 Pacific Steel Casting Co-Plant #3 Alameda Total 2.89E+02 Contra Costa 1.62E+01 ConocoPhillips

- San Francisco Refinery Contra Costa 7.37E-’-OO Shell Martinez Refinery Contra Costa Total 2.36E+01 (Ibs/yr) 3.13E+02
Additionally, the District monitors lead at its EPA National Core (NCore) monitoring location in San Jose. NCore stations are multi-pollutant monitoring stations. The lead data from’ the San Jose site for the 4th quarter of 2011 shows lead levels 60% of the current NAAQS (0.009 ug/m3 )21 Airports are a special category currently, and BAAQMD is monitoring for lead as part of a required 1-year study at three regional airports (Reid Hillview and Palo Alto Airports in Santa Clara County and San Carlos Airport in San Mateo County), because emissions from piston engine aircraft using leaded fuel may approach 0.5 tons per year. The monitors will become permanent if any 3-month rolling average is equal to or exceeds 50% of the NAAQS. Airport

21 Analytical Results of Testing, Eastern Research Group, July 11, 2012.

10lead TSP filter analysis is being performed by an EPA contract lab. The District is still awaiting

the first quarter’s results.
The District has been monitoring from a Special Purpose Monitoring Site in Cupertino related to the Lehigh Cement plant. After collecting an entire year of data from September 2010 through August 2011, the monitoring22 showed a concentration of 0.002 ug/m3 for both a 30 day average and 3 month average or 13% of the standard.
It is unlikely than even a significant increase in lead will hurt the District’s continual attainment of the NAAQS for lead. The thresholds for modeling and public noticing will ensure a “backstop” requirement to perform air quality modeling and public noticing for those applications with significant increases in emissions. Issuing minor NSR permits for new and modified sources will not interfere with attainment and maintenance of the lead NAAQS.

22 BAAQMD Summary and Analysis of Cupertino Air Monitoring Results, December 8, 20111

CAA § 110(l) Analysis

– Proposed Amendments to BAAQMD Regulation 2

– September 26, 2012 CAA Section 110(l) Analysis of BAAQMD Permit Exemption Provisions in Regulation 2, Rule 1 Section 110(l) of the Clean Air Act, 42 U.S.C. § 7410, requires that when a state revises its State Implementation Plan (SIP) , EPA may not approve the revision if it would interfere with any requirement concerning attainment and reasonable further progress, or any other applicable CAA requirement. EPA Region IX Staff have requested that the Air District prepare an analysis of any changes to the exemptions provided in the current EPA

- approved version of Regulation 2, Rule 1 that is part of the California SIP. EPA Region IX Staff have expressed a concern that if additional sources for which permits are required under the current SIP are exempted, that could potentially implicate requirements related to attainment and reasonable further progress or other CAA requirements. This analysis responds to EPA Region IX Staff’s request, and will help EPA in reviewing the revised Regulation 2, Rule 1 for SIP approval under Section 110(l).

This analysis compares the exemptions contained in Regulation 2, Rule 1 in the Proposed Amendments with the most recent EPA

- approved regulations in the State Implementation Plan. The analysis includes revisions to the exemptions that will be ma de as part of the Proposed Amendments, and also prior revisions that have been made in earlier amendments adopted by the Boar d of Directors that have not yet been reviewed by EPA. The analysis concludes that the revisions to the District’s permitting exem ptions under the Proposed Amendments (and those made in earlier amendments since the most recent EPA

- approved version) will not interfere with any requirement concerning attainment and reasonable further progress or any other applicable CAA requirement. There are several reasons that support this conclusion. First, as a general reason that applies to all amendments, the Air District’s regulatory program as a whole

– including the NSR permitting program – ensure s that the Bay Area is consistent with all C AA requirements for attaining and maintaining the NAAQS and making reasonable further progress. The Air District, along with its sister agencies that help administer some applicable requirements, have satisfied all CAA requirements concerning attainment a nd reasonable further progress toward attainment of the NAAQS. 1 In doing so, the Air District has taken into account the fact that there will be a certain amount of emissions growth from ne w and modified sources in the Bay Area, including sources that are exempt from permitting requirements under the exemptions provided in Regulation 2, Rule 1. Even with such growth, air qualit y in the Bay Area is in compliance with the NAAQS or on a path to achieving that goal. The Air District’s satisfaction of and com pliance with all CAA requirements concerning attainment and reasonable further progress has been achieved taking into account that there will be growth in emissions from exempt sources, and nothing in the exemptions provided in Regulation 2, R ule 1 undermi nes or interferes with the District’s satisfaction of or compliance with any such requirement. Thus, as a general matter applicable to all of Regulation 2, Rule 1, there is nothing in any of the revised exemption provisions that would prohibit SIP approva l under CAA Section 110(l)

. 2
Furthermore, looking at each individual revised exemption provision, there is no evidence on which to conclude that any of th em will authorize any unpermitted source s in a manner that would interfere with any applicable requi rement concerning attainment or reasonable further progress or any other CAA requirement. This exemption

- by

- exemption analysis is set forth in the table below.

1 With respect to PM 2.5 , the Air Distric t will be satisfying its requirements through documentation and analysis being prepared concurrently with the proposed amendm ents, which will be submitted for EPA review and approval.

2 This analysis is discussed further in Section IV.B.3.a. of the Staff R eport for the proposed amendments, drawing on technical analysis in the memorandum by C. Lee entitled “Analysis of Compliance with 40 C.F.R. § 51.169(a)&(b)” (August 2012). Please see that discussion for further information.2

CAA § 110(l) Analysis

– Proposed Amendments to BAAQMD Regulation 2

– September 26, 2012 Exemption Provision Brief Description of Exemption Revision to Current SIP? Interfere with

re quirements related to attainment or RFP? Basis for Conclusions

2

- 1

- 103 Sources not subject to any District

rule. Yes No Per the limitations in Section 2

- 1

- 319, this exemption exempts only sources with emissions of less than 5 tpy (among other important re quirements). Such sources are well below the levels at which EPA considers emissions to be de minimis for purposes of maintaining compliance with the NAAQS. EPA has established such levels in accordance with the principles addressed in Alabama Power v. C ostle as being so low that they do not have any potential to contribute to an exceedance of any NAAQS sufficient to warrant being subject to NSR permitting requirements

. The s ources eligible for this exemption will not have emissions of more than 50% of e ven the lowest such de minimis level. Moreover, District Staff conducted an analysis of the annual emissions increases from all projects that are subject to permitting requirements with emissions below these de minimis levels, which showed that the total contribution from all such sources each year is only 0.02% to 0.34% of the Bay Area’s total emissions inventory (depending on pollutant and year evaluated). Even if the total emissions from all de minimis exempt projects equaled this amount of emissions f rom de minimis permitted projects, they would not interfere with requirements related to attainment or reasonable further progress toward attainment. Emissions projections for the Bay Area do not show that increases from new sources expected in the coming years

– including from sources exempt from District permitting requirements

– will jeopardize the District’s attainment efforts. See also Staff Report Section IV.B.3.a. & fn. 73 (Lee memorandum) for further details.

2

- 1

- 105 CARB

- registered por table

equipment Yes No This equipment is regulated at the state level by the Air Resources Board. ARB regulation establishes effective emissions controls, including requirements such as BACT. ARB regulations (i.e., valid PERP registration) pre

- empts Dist rict permitting of such equipment, and so the District does not have jurisdiction to require permits for this equipment. See HSC §§ 41752

– 41754. Effective ARB regulation will ensure that emissions from such equipment will not interfere with requirement s related to attainment or reasonable further progress.

2

- 1

- 106 Accelerated Permitting Program Yes No This is not a true permitting exemption. It is an exemption from the Authority to Construct requirement only, for situations where a source will be perm itted under the Accelerated Permitting Program. Such sources will still be subject to NSR permitting requirements, it is just that they will obtain a Permit to Operate without first obtaining an Authority to Construct. Accordingly, this is not an exempti on from the substantive NSR requirement to obtain a permit and comply with all applicable NSR elements. As such, it will not interfere with requirements related to attainment or reasonable further progress or any other applicable CAA requirement.3

CAA § 110(l) Analysis

– Proposed Amendments to BAAQMD Regulation 2

– September 26, 2012 Exemption Provision Brief Description of Exemption Revision to Current SIP? Interfere with

re quirements related to attainment or RFP? Basis for Conclusions

2

- 1

- 113 .1.1 Single and multiple family

dwellings No N/A * In current SIP, 2

- 1

- 113.1 and

- 113.2

2

- 1

- 113.1.2 Agricultural sources Yes No This exemption is part of a revision to District regulations to start permitting agricultural sources. Under the most recent SI P

- approved version of District regulations, agricultural sources were subject to blanket exclusion/exemption provisi ons under Regulations 1

- 110 .5 ( “agriculture operations” ) and 2

- 1

- 113.7 ( “ farming operations ” ). The District has revised its rules and is no w requiring permits for agricultural operations with emissions over 50 tons per year. This provision continues to exempt agricultural operations below that threshold. This change is therefore a narrowing of the exemption for such sources, not an expansio n of the exemption. As such, it is not a relaxation from the current SIP rules

– it is actually making the permitting requirements more stringent in this regard

– and it will not interfere with requirements related to attainment or RFP.

2

- 1

- 113.1.3 Vehi cles No N/A* Vehicles are not stationary sources and have never been regulated under NSR. They have never been permitted under the District’s SIP

- approved NSR program, and the District has never even had any jurisdicti on to require permitting per HSC 4231 0(a)(1)

. Emissions from vehicle engines are excluded from regulation under the District’s regulations

– including Regulation 2

– under current SIP

- approved Reg. 1

- 110.1 (which incorporates by reference the definition of “vehicle” in the Vehicle Code)

. Sp ecifying that they are exempt from permitting will not change their regulatory treatment under the District’s SIP

- approved regulations

. 2

- 1

- 113.1.4 Tank vehicles No N/A* Tank vehicles (e.g., gasoline delivery trucks) are also mobile sources that the Dis trict does not regulate and has never regulated. See also basis for Section 2

- 1

- 113.1.3 exemption regarding vehicles

. 2

- 1

- 113.2.1 Road construction No N/A* In current SIP, 2

- 1

- 113.4 2

- 1

- 113.2.2 Restaurants No N/A* In current SIP, 2

- 1

- 113.5
2

- 1

- 113.2.3 Structural changes that do not

affect emissions No N/A* In current SIP, 2

- 1

- 113.6

2

- 1

- 113.2.4 Abatement devices used on

equipment that is exempt from permitting No N/A* In current SIP, 2

- 1

- 113.1

2

- 1

- 113.2. 5 Architectural and industrial

maintenance coatin g operations subject to Regulations 8

- 3 and 8

- Yes No These maintenance operations are subject to the District’s coating regulations in Regulations 8

- 3 and 8

- 48, and emissions from them will be controlled without permitting. Compliance with requirements related to attainment and reasonable further progress has been satisfied accounting for emissions from4

CAA § 110(l) Analysis

– Proposed Amendments to BAAQMD Regulation 2

– September 26, 2012 Exemption Provision Brief Description of Exemption Revision to Current SIP? Interfere with

re quirements related to attainment or RFP? Basis for Conclusions

48 coating operations in the Bay Area. Such operations will not interfere with any such requirements, even without being subject to NSR permitting.

2

- 1

- 113.2.6 Portable equipment used for tank

degassing or vacuum truck control requirements under Reg. 8

- 5, 8

- 40, or 8

- 53 Yes No This equipment is subject to the District’s degassing requirements in Regulations 8

- 3 and 8

- 48, and emissions from them will be co ntrolled without permitting. Compliance with requirements related to attainment and reasonable further progress has been satisfied account ing for emissions from s uch degassing operation s in the Bay Area. Such operations will not interfere with any suc h requirements, even without being subject to NSR permitting.

2

- 1

- 113.2. 7 PUC

- regulated natural gas

transmission and storage equipment Yes No Natural gas in essentially non

- reactive and does not contribute to ozone formation and will not substantially con tribute to ozone concentrations, and will not substantially contribute to concentrations of any other criteria pollutant. Thus even if there were emissions from such equipment, it would not interfere with requirements related to attainment or maintenance of any NAAQS.

2

- 1

- 113.2. 11 Classroom teaching laboratories Yes No Classroom teaching laboratories are limited in scope within the Bay Area are not significant contributors to the region’s emissions inventory of criteria air pollutants. Emissions from m iscellaneous processes such as these are included in the analyses and demonstrations that the Air District makes for compliance with applicable requirements concerning attainment and reasonable further progress. Allowing such classroom teaching laboratory activities without requiring an NSR permit will not interfere with any such requirements.

2

- 1

- 113.2. 12 Laboratories <25,000 ft 2 /50 fume

hoods that use Responsible Laboratory Management Practices Yes No Emissions from laboratory activities that are below the size cutoff established in this exemption and which use Responsible Laboratory Management Practices are limited in scope within the Bay Area are not significant contributors to the region’s emissions inventory of criteria air pollutants. Emissions fro m miscellaneous processes such as these are included in the analyses and demonstrations that the Air District makes for compliance with applicable requirements concerning attainment and reasonable further progress. Allowing such laboratory activities with out requiring an NSR permit will not interfere with any such requirements.

2

- 1

- 113.2. 13 Venting residual natural gas for

pipeline maintenance operations Yes No Natural gas in essentially non

- reactive and does not contribute to ozone formation and will not substantially contribute to ozone concentrations, and will not substantially contribute to concentrations of any other criteria pollutant. Venting any residual gas that remains in pipelines when maintenance is performed will therefore not interfere with requirements related to attainment or maintenance of any NAAQS. 2

- 1

- 113.2.15 Asbestos renovation under Reg. Yes No There is no NAAQS for asbestos, so even if asbestos removal that complies with Reg. 11

- 2 did have any5

CAA § 110(l) Analysis

– Proposed Amendments to BAAQMD Regulation 2

– September 26, 2012 Exemption Provision Brief Description of Exemption Revision to Current SIP? Interfere with

re quirements related to attainment or RFP? Basis for Conclusions

11

- 2 potential to emit some asbestos f ibers, such emissions would not interfere with requirements related to attainment or maintenance of any NAAQS.

2

- 1

- 113.2.16 Closed landfills <1M tons Yes No The District exempts such landfills from NSR permitting requirements because they are not signif icant sources of emissions and are no longer active operations receiving waste. EPA has not subjected such landfill sources to its NSPS guidelines requirements, and the District has exempted them from its NSR permitting requirements for the same reason. These landfill sources are not significant emissions sources and have been taken into account in complying with applicable requirements related to attainment and reasonable further progress.

2

- 1

- 113.2.17 Closed landfills 30+ years old Yes No The Distric t exempts such landfills from NSR permitting requirements because they are not significant sources of emissions and are no longer active operations receiving waste. EPA has not subjected such landfill sources to its NSPS guidelines requirements, and the D istrict has exempted them from its NSR permitting requirements for the same reason. These landfill sources are not significant emissions sources and have been taken into account in complying with applicable requirements related to attainment and reasonabl e further progress.

2

- 1

- 113.2.18 Construction of structure that

does not require a permit Yes No The District has never regulated construction activities as a regulated activity in and of itself (as opposed to requiring an authority to construct for per mitted sources, regulating certain types of equipment that may be used in construction, etc.). This exemption simply codifies that practice. Allowing such construction activities without requiring permits will not interfere with any applicable requiremen ts related to attainment and reasonable further progress. The District has satisfied all applicable requirements related to attainment and reasonable further progress taking construction activities into account regardless of whether they will be permitted or unpermitted, and allowing them to take place without requiring an NSR permit will not interfere with such requirements.

2

- 1

- 113.2.19 Vacuum trucks subject to Reg. 8

-

53 Yes No The District has never regulated vacuum truck operations, and historic ally it has not required permits for such operations because there have not been any regulatory requirements applicable to them. The District has recently (as of April 2012) started regulating vacuum truck operations under Regulation 8, Rule 53. This exem ption was added to specify that although such operations are regulated under 8

- 53, they will not be subject to permit requirements. The District’s rules will be more stringent as a result of these changes, as emissions from such operations will now be reg ulated. Emissions from vacuum truck operations will be controlled under Regulation 8

- 53 even without permitting. Compliance with requirements related to attainment and reasonable further progress has been based on accounting for6

CAA § 110(l) Analysis

– Proposed Amendments to BAAQMD Regulation 2

– September 26, 2012 Exemption Provision Brief Description of Exemption Revision to Current SIP? Interfere with

re quirements related to attainment or RFP? Basis for Conclusions

emissions from refineries and other industrial facilities tha t u se vacuum trucks. V acuum truck operations eligible for this exemption were also specifically identified in the District’s 2010 Clean Air Plan, in Stationary Source Measure SSM

- 5. Such operations will not interfer e with any such requirements, even without being subject to NSR permitting.

2

- 1

- 114 Combustion equipment Yes No This exemption is in the current SIP, but it has been revised in several respects. The new provisions that have been added will not interfer e with requirements related to attainment , reasonable further progress, or other CAA requirements. Per the limitations in Section 2

- 1

- 319, this exemption exempts only sources with emissions of less than 5 tpy (among other important requirements). Such so urces are well below the levels at which EPA considers emissions to be de minimis for purposes of maintaining compliance with the NAAQS. EPA has established such levels in accordance with the principles addressed in Alabama Power v. Costle as being so low that they do not have any potential to contribute to an exceedance of any NAAQS sufficient to warrant being subject to NSR permitting requirements. The sources eligible for this exemption will not have emissions of more than 50% of even the lowest such d e minimis level. Moreover, District Staff conducted an analysis of the annual emissions increases from all projects that are subject to permitting requirements with emissions below these de minimis levels, which showed that the total contribution from all such sources each year is only 0.02% to 0.34% of the Bay Area’s total emissions inventory (depending on pollutant and year evaluated). Even if the total emissions from all de minimis exempt projects equaled this amount of emissions from de minimis permit ted projects, they would not interfere with requirements related to attainment or reasonable further progress toward attainment. Emissions projections for the Bay Area do not show that increases from new sources expected in the coming years

– including fr om sources exempt from District permitting requirements

– will jeopardize the District’s attainment efforts. See also Staff Report Section IV.B.3.a. & fn. 73 (Lee memorandum) for further details.

2

- 1

- 115 Particulate sources

– quarries

mineral process ing and biomass Yes No This is a new exemption that has been added since the most recent SIP version of Reg. 2

- 1. This new exemption will not interfere with requirements related to attainment , reasonable further progress, or other CAA requirements. Per th e limitations in Section 2

- 1

- 319, this exemption exempts only sources with emissions of less than 5 tpy (among other important requirements). Such sources are well below the levels at which EPA considers emissions to be de minimis for purposes of maintain ing compliance with the NAAQS. EPA has established such levels in accordance with the principles addressed in Alabama Power v. Costle as being so low that they do not have any potential to contribute to an7

CAA § 110(l) Analysis

– Proposed Amendments to BAAQMD Regulation 2

– September 26, 2012 Exemption Provision Brief Description of Exemption Revision to Current SIP? Interfere with

re quirements related to attainment or RFP? Basis for Conclusions

exceedance of any NAAQS sufficient to warrant bei ng subject to NSR permitting requirements. The sources eligible for this exemption will not have emissions of more than 50% of even the lowest such de minimis level. Moreover, District Staff conducted an analysis of the annual emissions increases from al l projects that are subject to permitting requirements with emissions below these de minimis levels, which showed that the total contribution from all such sources each year is only 0.02% to 0.34% of the Bay Area’s total emissions inventory (depending on p ollutant and year evaluated). Even if the total emissions from all de minimis exempt projects equaled this amount of emissions from de minimis permitted projects, they would not interfere with requirements related to attainment or reasonable further progr ess toward attainment. Emissions projections for the Bay Area do not show that increases from new sources expected in the coming years

– including from sources exempt from District permitting requirements

– will jeopardize the District’s attainment effort s. See also Staff Report Section IV.B.3.a. & fn. 73 (Lee memorandum) for further details.

2

- 1

- 116 Furnaces ovens and kilns Yes No This exemption is in the current SIP, but it has been revised in several respects. The new provisions that have been added will not interfere with requirements related to attainment , reasonable further progress, or other CAA requirements. Per the limitations in Section 2

- 1

- 319, this exemption exempts only sources with emissions of less than 5 tpy (among other important requir ements). Such sources are well below the levels at which EPA considers emissions to be de minimis for purposes of maintaining compliance with the NAAQS. EPA has established such levels in accordance with the principles addressed in Alabama Power v. Costl e as being so low that they do not have any potential to contribute to an exceedance of any NAAQS sufficient to warrant being subject to NSR permitting requirements. The sources eligible for this exemption will not have emissions of more than 50% of even the lowest such de minimis level. Moreover, District Staff conducted an analysis of the annual emissions increases from all projects that are subject to permitting requirements with emissions below these de minimis levels, which showed that the total cont ribution from all such sources each year is only 0.02% to 0.34% of the Bay Area’s total emissions inventory (depending on pollutant and year evaluated). Even if the total emissions from all de minimis exempt projects equaled this amount of emissions from de minimis permitted projects, they would not interfere with requirements related to attainment or reasonable further progress toward attainment. Emissions projections for the Bay Area do not show that increases from new sources expected in the coming yea rs – including from sources exempt from District permitting requirements

– will jeopardize the District’s attainment efforts. See also Staff Report Section8

CAA § 110(l) Analysis

– Proposed Amendments to BAAQMD Regulation 2

– September 26, 2012 Exemption Provision Brief Description of Exemption Revision to Current SIP? Interfere with

re quirements related to attainment or RFP? Basis for Conclusions

IV.B.3.a. & fn. 73 (Lee memorandum) for further details.

2

- 1

- 117 Food and agricultural equipment Y es No This exemption is in the current SIP, but it has been revised in several respects. The new provisions that have been added will not interfere with requirements related to attainment , reasonable further progress, or other CAA requirements. Per the l imitations in Section 2

- 1

- 319, this exemption exempts only sources with emissions of less than 5 tpy (among other important requirements). Such sources are well below the levels at which EPA considers emissions to be de minimis for purposes of maintaining compliance with the NAAQS. EPA has established such levels in accordance with the principles addressed in Alabama Power v. Costle as being so low that they do not have any potential to contribute to an exceedance of any NAAQS sufficient to warrant being subject to NSR permitting requirements. The sources eligible for this exemption will not have emissions of more than 50% of even the lowest such de minimis level. Moreover, District Staff conducted an analysis of the annual emissions increases from all p rojects that are subject to permitting requirements with emissions below these de minimis levels, which showed that the total contribution from all such sources each year is only 0.02% to 0.34% of the Bay Area’s total emissions inventory (depending on poll utant and year evaluated). Even if the total emissions from all de minimis exempt projects equaled this amount of emissions from de minimis permitted projects, they would not interfere with requirements related to attainment or reasonable further progress toward attainment. Emissions projections for the Bay Area do not show that increases from new sources expected in the coming years

– including from sources exempt from District permitting requirements

– will jeopardize the District’s attainment efforts. See also Staff Report Section IV.B.3.a. & fn. 73 (Lee memorandum) for further details.

2

- 1

- 118 Surface preparation and cleaning

equipment Yes No This exemption is in the current SIP, but it has been revised in several respects. The new provisions that h ave been added will not interfere with requirements related to attainment , reasonable further progress, or other CAA requirements. Per the limitations in Section 2

- 1

- 319, this exemption exempts only sources with emissions of less than 5 tpy (among other i mportant requirements). Such sources are well below the levels at which EPA considers emissions to be de minimis for purposes of maintaining compliance with the NAAQS. EPA has established such levels in accordance with the principles addressed in Alabama Power v. Costle as being so low that they do not have any potential to contribute to an exceedance of any NAAQS sufficient to warrant being subject to NSR permitting requirements. The sources eligible for this exemption will not have emissions of more th an 50% of even the lowest such de minimis level. Moreover, District Staff conducted an analysis of the annual emissions increases9

CAA § 110(l) Analysis

– Proposed Amendments to BAAQMD Regulation 2

– September 26, 2012 Exemption Provision Brief Description of Exemption Revision to Current SIP? Interfere with

re quirements related to attainment or RFP? Basis for Conclusions

from all projects that are subject to permitting requirements with emissions below these de minimis levels, which showed that the total contribution from all such sources each year is only 0.02% to 0.34% of the Bay Area’s total emissions inventory (depending on pollutant and year evaluated). Even if the total emissions from all de minimis exempt projects equaled this amount of emissions from de minimis permitted projects, they would not interfere with requirements related to attainment or reasonable further progress toward attainment. Emissions projections for the Bay Area do not show that increases from new sources expected in the coming years

– including from sources exempt from District permitting requirements

– will jeopardize the District’s attainment efforts. See also Staff Report Section IV.B.3.a. & fn. 73 (Lee memorandum) for further details.

2

- 1

- 119 Surface coating an d cleaning

equipment Yes No This exemption is in the current SIP, but it has been revised in several respects. The new provisions that have been added will not interfere with requirements related to attainment , reasonable further progress, or other CAA re quirements. Per the limitations in Section 2

- 1

- 319, this exemption exempts only sources with emissions of less than 5 tpy (among other important requirements). Such sources are well below the levels at which EPA considers emissions to be de minimis for p urposes of maintaining compliance with the NAAQS. EPA has established such levels in accordance with the principles addressed in Alabama Power v. Costle as being so low that they do not have any potential to contribute to an exceedance of any NAAQS suffic ient to warrant being subject to NSR permitting requirements. The sources eligible for this exemption will not have emissions of more than 50% of even the lowest such de minimis level. Moreover, District Staff conducted an analysis of the annual emission s increases from all projects that are subject to permitting requirements with emissions below these de minimis levels, which showed that the total contribution from all such sources each year is only 0.02% to 0.34% of the Bay Area’s total emissions invent ory (depending on pollutant and year evaluated). Even if the total emissions from all de minimis exempt projects equaled this amount of emissions from de minimis permitted projects, they would not interfere with requirements related to attainment or reaso nable further progress toward attainment. Emissions projections for the Bay Area do not show that increases from new sources expected in the coming years

– including from sources exempt from District permitting requirements

– will jeopardize the District’ s attainment efforts. See also Staff Report Section IV.B.3.a. & fn. 73 (Lee memorandum) for further details.
2

- 1

- 120 Dry cleaning equipment Yes No This exemption is in the current SIP, but it has been revised in several respects. To the extent that it i s any less stringent than the current SIP version, it will not interfere with requirements related to10

CAA § 110(l) Analysis

– Proposed Amendments to BAAQMD Regulation 2

– September 26, 2012 Exemption Provision Brief Description of Exemption Revision to Current SIP? Interfere with

re quirements related to attainment or RFP? Basis for Conclusions

attainment , reasonable further progress, or other CAA requirements. Per the limitations in Section 2

- 1

- 319, this exemption exempts only sources with emis sions of less than 5 tpy (among other important requirements). Such sources are well below the levels at which EPA considers emissions to be de minimis for purposes of maintaining compliance with the NAAQS. EPA has established such levels in accordance w ith the principles addressed in Alabama Power v. Costle as being so low that they do not have any potential to contribute to an exceedance of any NAAQS sufficient to warrant being subject to NSR permitting requirements. The sources eligible for this exemp tion will not have emissions of more than 50% of even the lowest such de minimis level. Moreover, District Staff conducted an analysis of the annual emissions increases from all projects that are subject to permitting requirements with emissions below the se de minimis levels, which showed that the total contribution from all such sources each year is only 0.02% to 0.34% of the Bay Area’s total emissions inventory (depending on pollutant and year evaluated). Even if the total emissions from all de minimis exempt projects equaled this amount of emissions from de minimis permitted projects, they would not interfere with requirements related to attainment or reasonable further progress toward attainment. Emissions projections for the Bay Area do not show that increases from new sources expected in the coming years

– including from sources exempt from District permitting requirements

– will jeopardize the District’s attainment efforts. See also Staff Report Section IV.B.3.a. & fn. 73 (Lee memorandum) for furth er details.

2

- 1

- 121 Material working and handling

equipment Yes No This exemption is in the current SIP, but it has been revised in several respects. The new provisions that have been added will not interfere with requirements related to attainment , reas onable further progress, or other CAA requirements. Per the limitations in Section 2

- 1

- 319, this exemption exempts only sources with emissions of less than 5 tpy (among other important requirements). Such sources are well below the levels at which EPA co nsiders emissions to be de minimis for purposes of maintaining compliance with the NAAQS. EPA has established such levels in accordance with the principles addressed in Alabama Power v. Costle as being so low that they do not have any potential to contrib ute to an exceedance of any NAAQS sufficient to warrant being subject to NSR permitting requirements. The sources eligible for this exemption will not have emissions of more than 50% of even the lowest such de minimis level. Moreover, District Staff cond ucted an analysis of the annual emissions increases from all projects that are subject to permitting requirements with emissions below these de minimis levels, which showed that the total contribution from all such sources each year is only 0.02% to 0.34%11

CAA § 110(l) Analysis

– Proposed Amendments to BAAQMD Regulation 2

– September 26, 2012 Exemption Provision Brief Description of Exemption Revision to Current SIP? Interfere with

re quirements related to attainment or RFP? Basis for Conclusions

of the Bay Area’s total emissions inventory (depending on pollutant and year evaluated). Even if the total emissions from all de minimis exempt projects equaled this amount of emissions from de minimis permitted projects, they would not interfere with req uirements related to attainment or reasonable further progress toward attainment. Emissions projections for the Bay Area do not show that increases from new sources expected in the coming years

– including from sources exempt from District permitting requ irements

– will jeopardize the District’s attainment efforts. See also Staff Report Section IV.B.3.a. & fn. 73 (Lee memorandum) for further details.

2

- 1

- 122 Casting and molding equipment No N/A* No substantive change to the current SIP version. The only changes are a clarification that extrusion molding is a type of plastic molding covered by this exemption under subsection 2

- 1

- 122.4, and that certain mold release products are not subject to the exemption unless they involve very low amounts of VOC with annual facility VOC emissions under 150 lb/yr. To the extent that this exclusion for VOC mold release products was not already a part of the exemption, this revision makes the exemption more narrow and is a strengthening of the regulation, not a relaxatio n. Moreover, to the extent any Section 110(l) analysis is required, 150 lb/yr is a very low emissions limit and will not interfere with requirements related to attainment or reasonable further progress for the same reasons provided for other exemptions up to 5 tons per year.

2

- 1

- 123 Liquid storage and loading

equipment Yes No This exemption is in the current SIP, but it has been revised in several respects. The new provisions that have been added will not interfere with requirements related to attainme nt , reasonable further progress, or other CAA requirements. Per the limitations in Section 2

- 1

- 319, this exemption exempts only sources with emissions of less than 5 tpy (among other important requirements). Such sources are well below the levels at whic h EPA considers emissions to be de minimis for purposes of maintaining compliance with the NAAQS. EPA has established such levels in accordance with the principles addressed in Alabama Power v. Costle as being so low that they do not have any potential to contribute to an exceedance of any NAAQS sufficient to warrant being subject to NSR permitting requirements. The sources eligible for this exemption will not have emissions of more than 50% of even the lowest such de minimis level. Moreover, District St aff conducted an analysis of the annual emissions increases from all projects that are subject to permitting requirements with emissions below these de minimis levels, which showed that the total contribution from all such sources each year is only 0.02% t o 0.34% of the Bay Area’s total emissions inventory (depending on pollutant and year evaluated). Even if the total emissions from all de minimis exempt projects equaled this amount of emissions from de minimis12

CAA § 110(l) Analysis

– Proposed Amendments to BAAQMD Regulation 2

– September 26, 2012 Exemption Provision Brief Description of Exemption Revision to Current SIP? Interfere with

re quirements related to attainment or RFP? Basis for Conclusions

permitted projects, they would not interfere with requirements related to attainment or reasonable further progress toward attainment. Emissions projections for the Bay Area do not show that increases from new sources expected in the coming years

– including from sources exempt from District permitt ing requirements

– will jeopardize the District’s attainment efforts. See also Staff Report Section IV.B.3.a. & fn. 73 (Lee memorandum) for further details.

2

- 1

- 124 Semiconductor manufacturing Yes No This exemption is in the current SIP, but it has been revised in several respects. The new provisions that have been added will not interfere with requirements related to attainment , reasonable further progress, or other CAA requirements. Per the limitations in Section 2

- 1

- 319, this exemption exempts only s ources with emissions of less than 5 tpy (among other important requirements); and furthermore the language of the exemption restricts facility VOC emissions to 150 pounds per year. Such sources are well below the levels at which EPA considers emissions t o be de minimis for purposes of maintaining compliance with the NAAQS. EPA has established such levels in accordance with the principles addressed in Alabama Power v. Costle as being so low that they do not have any potential to contribute to an exceedanc e of any NAAQS sufficient to warrant being subject to NSR permitting requirements. The sources eligible for this exemption will not have emissions of more than 50% of even the lowest such de minimis level. Moreover, District Staff conducted an analysis o f the annual emissions increases from all projects that are subject to permitting requirements with emissions below these de minimis levels, which showed that the total contribution from all such sources each year is only 0.02% to 0.34% of the Bay Area’s t otal emissions inventory (depending on pollutant and year evaluated). Even if the total emissions from all de minimis exempt projects equaled this amount of emissions from de minimis permitted projects, they would not interfere with requirements related t o attainment or reasonable further progress toward attainment. Emissions projections for the Bay Area do not show that increases from new sources expected in the coming years

– including from sources exempt from District permitting requirements

– will jeo pardize the District’s attainment efforts. See also Staff Report Section IV.B.3.a. & fn. 73 (Lee memorandum) for further details.

2

- 1

- 125 Printed circuit board

manufacturing Yes No This exemption is in the current SIP, but it has been revised in several respects. The new provisions that have been added will not interfere with requirements related to attainment , reasonable further progress, or other CAA requirements. Per the limitations in Section 2

- 1

- 319, this exemption exempts only sources with emissio ns of less than 5 tpy (among other important requirements). Such sources are well below the levels at which EPA considers emissions to be de minimis for purposes of maintaining13

CAA § 110(l) Analysis

– Proposed Amendments to BAAQMD Regulation 2

– September 26, 2012 Exemption Provision Brief Description of Exemption Revision to Current SIP? Interfere with

re quirements related to attainment or RFP? Basis for Conclusions

compliance with the NAAQS. EPA has established such levels in accordance with the principles addressed in Alabama Power v. Costle as being so low that they do not have any potential to contribute to an exceedance of any NAAQS sufficient to warrant being subject to NSR permitting requirements. The sources eligible for this exemptio n will not have emissions of more than 50% of even the lowest such de minimis level. Moreover, District Staff conducted an analysis of the annual emissions increases from all projects that are subject to permitting requirements with emissions below these de minimis levels, which showed that the total contribution from all such sources each year is only 0.02% to 0.34% of the Bay Area’s total emissions inventory (depending on pollutant and year evaluated). Even if the total emissions from all de minimis exe mpt projects equaled this amount of emissions from de minimis permitted projects, they would not interfere with requirements related to attainment or reasonable further progress toward attainment. Emissions projections for the Bay Area do not show that in creases from new sources expected in the coming years

– including from sources exempt from District permitting requirements

– will jeopardize the District’s attainment efforts. See also Staff Report Section IV.B.3.a. & fn. 73 (Lee memorandum) for further details.

2

- 1

- 126 Testing equipment No N/A* No substantive change to the current SIP version. The only changes are a clarification of the specific types of bench

- scale laboratory equipment that are covered under subsection 2

- 1

- 126 .2 . Moreover, to the ext ent any Section 110(l) analysis is required, this exemption is subject to the same 5 tpy limitation addressed in connection with other exemptions. The exemption will not interfere with requirements related to attainment or reasonable further progress for the same reasons provided for other exemptions up to 5 tons per year.

2

- 1

- 127 Chemical processing equipment No N/A* No substantive change to the current SIP version. The only change was to revise the list of the types of metals that are processed in elec trolytic plating operations in order to make it more comprehensive. Moreover, to the extent any Section 110(l) analysis is required, this exemption is subject to the same 5 tpy limitation addressed in connection with other exemptions. The exemption will not interfere with requirements related to attainment or reasonable further progress for the same reasons provided for other exemptions up to 5 tons per year.

2

- 1

- 128 Miscellaneous equipment Yes No This exemption is in the current SIP, but it has been r evised in several respects. The new provisions that have been added will not interfere with requirements related to attainment , reasonable further progress, or other CAA requirements. Per the limitations in Section 2

- 1

- 319, this exemption exempts only so urces with emissions of less than 5 tpy (among other important requirements). Such sources are14

CAA § 110(l) Analysis

– Proposed Amendments to BAAQMD Regulation 2

– September 26, 2012 Exemption Provision Brief Description of Exemption Revision to Current SIP? Interfere with

re quirements related to attainment or RFP? Basis for Conclusions

well below the levels at which EPA considers emissions to be de minimis for purposes of maintaining compliance with the NAAQS. EPA has established such levels in accordance with the principles addressed in Alabama Power v. Costle as being so low that they do not have any potential to contribute to an exceedance of any NAAQS sufficient to warrant being subject to NSR permitting requirements. The sources eligible for this exemption will not have emissions of more than 50% of even the lowest such de minimis level. Moreover, District Staff conducted an analysis of the annual emissions increases from all projects that are subject to permitting requirements with emis sions below these de minimis levels, which showed that the total contribution from all such sources each year is only 0.02% to 0.34% of the Bay Area’s total emissions inventory (depending on pollutant and year evaluated). Even if the total emissions from all de minimis exempt projects equaled this amount of emissions from de minimis permitted projects, they would not interfere with requirements related to attainment or reasonable further progress toward attainment. Emissions projections for the Bay Area d o not show that increases from new sources expected in the coming years

– including from sources exempt from District permitting requirements

– will jeopardize the District’s attainment efforts. See also Staff Report Section IV.B.3.a. & fn. 73 (Lee memora ndum) for further details.

Notes: *Section 110(l) applies to revisions to the SIP, so for exemptions where there is no revision to the District’s curren t SIP

- approved exemption Section 110(l) is not implicated and no analysis of interference with requirements related to attainm ent or reasonable further progress is required. (Although the District’s c ompliance with all applicable requirements relating to att ain ment and reasonable further progress even with emissions growth from sources subject to permit exemptions would of course apply to these provisions as well, even if Section 110(l) were implicated. )