### PLACER COUNTY

AIR POLLUTION CONTROL DISTRICT



## STAFF REPORT

AMENDMENT OF RULE 250, STATIONA RY GAS TURBINES

October 8, 2015

Prepared by:

John Finnell Manager of Permitting and EngineeringS TAFF R EPORT  Amendment to Rule 250 Stationary Gas Turbines

INTRODUCTION

Rule 250, Stationary Gas Turbines, applies to a ll stationary gas turbin es rated 0.3 megawatts (MW) and larger.

This rule amendment was prompted by U.S. Environmental Protection Agency (U.S. EPA)

notification that Rule 250 doe s not meet current Reasonably Available Control Technology (RACT).

The most notable changes are:

 The exemptions for pipeline and chemical pr ocessing gas turbines have been removed.

 References to efficiency have been removed from the rule standards, as they are no longer required.

 Limits during start-up and shutdown periods have been added for simple cycle gas turbines and for combined cycle gas turbines.

PUBLIC COMMENTS

A draft Rule 250 was prepared and public notic e published on September 6, 2015 that the draft Rule 250 was available for review and comment beginning September 8, 2015.

No public comments have been received.

U.S. EPA provided verbal comments. The followi ng changes were made in response to those

comments:

Section 102 – Deleted reference to Sections 110 and 111 which are now Sections 103 and 104. They are in the rule but this language is not needed.

Section 105 – Revised section which had incl uded a new exemption from SU/SD for low use turbines. This section was changed to only al low an exemption from the monitoring provisions for existing low use units operating less than 877 hours per year.

Section 204 – Major source definition was added.

Section 206 – Deleted HHV definition as it is no longer needed.

Section 206 – Performance testin g definition was added. The Di strict’s rules use the terms source testing and performance testing as interchangeable equivalent terms.

Section 207 – Deleted LHV definition as it is no longer needed.

Section 210 – Reinstated SCR definition that was previously in the rule.

Section 301 – Added that th e one-hour average is based on four consecutive 15-minute averages. Removed wording “thermal stabiliz ation” and changed to “startup and shutdown”.S TAFF R EPORT  Amendment to Rule 250 Stationary Gas Turbines

Section 501.1.3 – Deleted the 4,000 hr. requirement for CEMS, as other districts do not have this. However, an exemption is proposed, as shown in Section 105.

Section 501.2 – No change to this section. The District uses the term performance testing interchangeably with source testing. A Perf ormance Testing definition has been added in

Section 206.

Section 502.1 – Deleted sentence defini ng major source and added a major source

definition. The District would like to keep the requirement that records be kept for major sources for 5 years and non-major sources for 2 years.

BACKGROUND

There are currently two permitted faci lities within the District that are subject to Rule 250. They are both owned and operated by the City of Rosevi lle, Roseville Electric. One facility has two combined cycle gas turbine units with heat re covery and the other on e has two simple cycle

units.

The District does not expect the proposed rule am endments to have a significant impact on either

of these sources or the environment. It will not create emission reduc tions. This amendment simply provides an updated RACT rule.

The amended rule, if approved, will also apply to any new sources. New sources will trigger Best Available Control Technology (BACT) re quirements for NOx emissions. These will be more stringent than the re quirements of this rule.

Stationary gas turbines are engines consum ing liquid or gaseous fuels, which produce mechanical power that can be used to perfor m mechanical work or can be converted into electrical power. Afte r air is compressed in the compresso r section of the engine, fuel is introduced and mixed with the air, and then th e mixture is ignited in the combustor. The expanding combustion gases exhaust through the tu rbine section of the engine, causing the turbine blades to spin and thus creating shaft po wer. The combustion of fuel by the stationary gas turbine results in the emi ssion of criteria pollutants: carbon monoxide (CO), oxides of nitrogen (NOx), oxides of sulfur (SOx), vol atile organic compounds ( VOC), and particulate matter ten microns (PM10). Many stationary gas turbines utilize selective catalytic reduction (SCR) as an emissions control technology. This control technology results in the emission of ammonia, which can negatively affect the respir atory system with acute and chronic exposures.

In the simple cycle gas turbine, power plant electr ical power is created fr om the generator driven by the gas turbine.

A later development in stationary power genera tion is the combined cycle power plant, which utilizes additional components. The more comple x combined cycle extracts useful heat energy from the gas turbine exhaust with a heat recove ry steam generator. The heat recovery steam generator then channels the steam to drive a st eam turbine. The shaft power from the steam turbine is used to drive an additional electric generator. The additional equipment of theS TAFF R EPORT  Amendment to Rule 250 Stationary Gas Turbines

combined cycle power plant result s in a greater amount of time necessary to reach steady-state operation compared to the simple cycle process.

AMENDMENTS OF RULE 250

Staff is proposing to make a number of amendmen ts to update the rule and to gain EPA SIP approval. These amendments are described below. A strikeout version of the amended rule is included in this staff report.

Section 100 General

Section 101, Purpose, was revised to remove the reference to Best Available Retrofit Control Technology (BARCT) determinations. Th is is not needed. The rule amendment is intended to meet Reasonably Available Control Technology (R ACT) requirements.

Section 102, Applicability, was revised to remove references to Section 110 and 111.

Section 110 is now 103. Section 111 is now 104. The exemptions for pipeline and chemical processing gas turbines were remove d. There are none in Placer. If one was added, they should meet this rule, and the un its would be subject to the more stringent

Best Available Control T echnology (BACT) standards wh en applying for a permit.

Section 105, Exemption – Low Use Unit, was added to provide an exemption from the monitoring requirements in Section 501.1.3. W ithout the exemption, the low use units would need to add an expensiv e continuous monitoring system.

Section 200 Definitions

The definition of BARCT, chemical processi ng gas turbine, high he ating value (hhv), low heating value (lhv), measured NOx emissions concentration, pipeline gas turbines and

thermal stabilization were removed because th e terms are not used in the proposed rule.

The definition of performance testing was added to clarify that this meant stack emissions testing or source testing.

A startup and a shutdown defin ition were added. The previo us rule allowed a two hour startup period. The time allowed for startup for a combined cycle turbine was increased from two (2) hours to six (6) hours.S TAFF R EPORT  Amendment to Rule 250 Stationary Gas Turbines

Section 300 Standards

Section 301, Limitations, currently has the standards shown below:

EXISTING LIMITATIONS

Unit Size Compliance limit

NO

x , ppm @ 15% O 2 Megawatt Rating (MW) Gas A Oil B

0.3 to Less Than 2.9 MW and Units Greater Than or Equal to 4 MW That Operate Less Than 877 Hour/Year 42 65

2.9 to Less Than 10 MW 25 x EFF /25 65

10.0 MW and Over with SCR 9 x EFF /25 25 x EFF /25

10.0 MW and Over W ithout SCR 15 x EFF /25 42 x EFF /25

A. GAS INCLUDES NATURAL, DIGESTER, AND LANDFILL GASES. B.OIL INCLUDES KEROSINE, JET, AND DISTILLATE. THE SU LFUR CONTENT OF THE OIL SHALL BE LESS THAN 0.05%.

Where: EFF (efficiency) is the higher of the following:

301.1 EFF = 3412 x 100%

AHR

[where: AHR = Actual Heat Rate at HHV of Fuel (BTU/KW-HR)], which is the demonstrated percent efficiency of th e gas turbine only as calculated without consideration of any downstream energy recovery from the actual heat rate, (BTU/KW-HR) or 1.34 (BTU/HP-HR); co rrected to the HHV (higher heating value) of the fuel and ISO conditions, as measured at peak load for that facility, or

301.2 EFF = MRE x LHV

HHV

[where: MRE = Manufacturer's Rated Efficiency with Air Pollution Equipment at LHV.], which is the manufacturer's conti nuous rated percent efficiency of the gas turbine with air pollution equipment after correction from LHV to HHV of the fuel at peak load for that facility.S TAFF R EPORT  Amendment to Rule 250 Stationary Gas Turbines

PROPOSED CHANGES TO NOx EM ISSION CONCENTRATION LIMITS

PROPOSED LIMITATIONS

Unit Size Compliance limit

NO

x , ppm @ 15% O 2 Megawatt Rating (MW) Gas A Oil B

Units rated 0.3 to Less Than 2.9 MW

OR Units Greater Than or Equal to 4 MW That Operate Less Than 877 Hour/Year 42 65

2.9 to Less Than 10 MW 25 65

10.0 MW and Over 9 25

A

. GAS INCLUDES ONLY COMMERCIAL NATURAL AND LIQUIFIED PETROLEUM GASES. B. OIL INCLUDES KEROSINE, JET, AND DISTILLATE OIL. TH E SULFUR CONTENT OF THE OIL SHALL BE LESS THAN 0.05%.

The proposed rule amendment removes the efficiency factor of EFF/25 which was applicable to the 9 and 25 ppm limits. Thes e are no longer used or needed. This makes the rule standards more stringent without having to make additional calculations to determine compliance.

The definition of EFF (Efficiency) was delete d because it is no longer used or needed.

Section 302 Startup/Shutdown Combined Cycle

This section adds emission limits dur ing startup or s hutdown periods.

There is a concern that an exemption of emission limits during startup without other limitations would provide a loophole for opera tors to have signifi cant emissions during startup. While there has b een considerable discussion about startup and shutdown emissions, there is very little literature on actual emissions durin g these periods. The actual emissions vary depending on many f actors including how long the turbine has been offline and ambient air temperature.

The best way to limit emissions is to limit the length of time of a startup. The rule amendment allows up to six (6) hours which is sufficient time for a large combined cycle unit to come online, even if there is a problem initially on the startup.

In addition, a startup/shutdown emission lim it of 70 ppmv @15% O2 was added based on the most recent rule change found in Yolo -Solano Air Quality Management District (YSAQMD) Amendment to Rule 2.34 Stationary Gas Turbines.

Alternatively, operators may comply by meeting a pounds per million British Thermal Unit limit (lbs./MMBtu)

The startup/shutdown pounds per MMBtu/hr li mit was based on the permit limit in the Roseville Electric Roseville Energy Park. The lbs/MMBtu of .016 was determined by dividing the NOx pounds per hour limit dur ing startup by the input fuel rate in

MMBtu/hr.S TAFF R EPORT  Amendment to Rule 250 Stationary Gas Turbines

The emission limit of 226 @15% O2 when a tu rbine is operated on fuel oil was also found in the YSAQMD Amendment to Ru le 2.34 Stationary Gas Turbines.

Section 303 Startup/Shutdown Simple Cycle Units

This section was added to require basic good practices be applie d during startup or shutdown of simple cycle units.

Section 400 Administrative Requirements

The compliance schedule in Section 401 and requirement to have an emission control plan in Section 402 were removed as they are no longer needed.

Section 500 Monitoring and Recordkeeping

Section 501 Monitoring

The language requiring a NOx continuous emissi ons monitor on units 10 MW or greater that operated more the 4000 hours per year over the last three years prior to July 13, 1994 has been changed to delete the wording, “t hat operated more than 4000 hours per year over the last three years prior to July 13, 1994”.

A NOx monitor is now required unless a gas turbine is a low use unit and exempt under

Section 105.

Section 502 Recordkeeping

A requirement was added for the owner or opera tor of a major source to maintain records for a period of five years. Non-major sour ces must keep records for a minimum of two (2) years.

The reference to the demonstrated percent effi ciency (EFF) was delete d as it is no longer

used in the emission standards.

The reference to recording in Pacific Standard Time was deleted at the request of

Roseville Electric.

Section 502.6 required maintain ing a gas turbine operating log. This section was nearly identical to the previous section 502.5 and is deleted becau se it is redundant.

Section 503 Test Methods

The test methods for LHV and HHV of fuel we re deleted as they are not used in the proposed version of this rule.S TAFF R EPORT  Amendment to Rule 250 Stationary Gas Turbines

COMPARISON TO OTHER APPLICABLE REGULATIONS AND REQUIREMENTS

New Source Performance Standards

Stationary gas turbines with a 10 Million Btu per hour heat input rate at peak load (based on the higher heating value of the fuel fired) are subjec t to the requirements of the EPA’s New Source Performance Standards (NSPS) c ontained in 40 CFR Part 60, Subpart KKKK. Table 2 below presents a comparative analysis between specific elements of the proposed revised rule and the corresponding elements of the existing federal regulation.

Comparison of Proposed Rule Revision Emission Limits with NSPS 40 CFR, Part 60, Subpart KKKK

Turbine Rating District Rule 250 NOx Emission Limits, ppmv@15% O 2 Federal Regulation 40 CFR Part 60, Subpart KKKK NOx Emission Limits, ppmv@15% O 2

˂ 10 MW fired

on Natural Gas 25 or 42 42, 100, or 150

˂ 10 MW fired

on fuel other

than Natural Gas 25, 42, or 65 96 or 150

≥ 10 MW fired

on Natural Gas 9 or 42* 15, 25, 42, 100, or 150

≥ 10 MW fired

on fuel other

than Natural Gas 9, 25, 42, or 65* 42, 74, 96, 100, or 150

* The 42 and 65 ppmv NOx limits in these categories only apply to turbines which are limited to operating for less than 877 hours/year

The standards for sulfur dioxide of 40 CFR Pa rt 60, Subpart KKKK requires either that the emission of sulfur dioxide (SO2) from any st ationary gas turbine not exceed 0.90 pounds per megawatt-hour or that the fuel burned not contain pot ential sulfur emissi ons in excess of 0.060 pounds of SO2 per million BTU. The subpart al so contains alternativ e compliance limits for

turbines in a non-continental area or if the EPA administrator finds both that the turbine is located in an area where natural gas is not avai lable, and that the removal of sulfur compounds

would cause more environmental ha rm than benefit. District Ru le 250 currently does not contain any restrictions on sulfur oxides and the propos ed amendments will not add any restrictions. Emissions of sulfur oxides from stationary gas tu rbines will be limited by other District rules and regulations, as well as st ate-level regulations on fuel sulfur content.

Stationary gas turbines with a 10 Million Btu per hour heat input rate at peak load (based on the lower heating value of the fuel fired) and not regulated under Subpart KKKK are subject to the requirements of NSPS contained in 40 CFR Part 60, Subpart GG. Table 3 below presents a comparative analysis between specific elemen ts of the proposed re vised rule and the corresponding elements of the existing federal regulation.S TAFF R EPORT  Amendment to Rule 250 Stationary Gas Turbines

Comparison of Proposed Rule Revision Emission Limits with NSPS 40 CFR, Part 60, Subpart GG

Turbine Rating District Rule 250 NOx Emission Limits, ppmv@15% O 2 Federal Regulation 40 CFR Part 60, Subpart GG NOx Minimum Emission Limits, ppmv@15% O 2

0.3 to Less Than 2.9

MW

And Units Greater Than or Equal to 4 MW That Operate

Less Than 877

Hour/Year 42 or 65 75 or 150

2.9 to Less Than 10.0

MW 25 or 65 150

10.0 MW and Over 9 or 25 75 or 150

The NOx emission limits presented for Subpart GG reflect the most stringent emission limits which can be increased to higher levels with an adjustment factor calculated from the

manufacturer’s rated he at rate at the manufacturer’s rate d peak load and a NOx emission allowance for fuel-bound nitrogen.

The federal regulation requires th at if a nonzero emission allowa nce for fuel-bound nitrogen is

used in the calculation of th e applicable NOx emission limit in Subpart GG, the owner or operator of the turbine shall monitor the nitrogen content of the fuel combusted by the approved

methods.

The standards for sulfur dioxide of 40 CFR Pa rt 60, Subpart GG require that the emission of sulfur dioxide from any stati onary gas turbine not exceed 0. 015 percent by volume at 15 percent excess oxygen on a dry basis. The regulation also requires the fuel fired in a stationary gas

turbine shall not contain sulfur in excess of 0.8 percent by weight. Distri ct Rule 250 currently does not contain any restrictions on sulfur oxides, and the proposed amendments will not add any

restrictions. Emissions of sulf ur oxides from stationary gas turbines will be limited by other District rules and regulations as well as state-level regula tions on fuel sulfur content.

Both 40 CFR Part 60, Subpart GG and District Rule 250 require monitoring of the emission unit to demonstrate compliance with the applicable emissions standards. The federal regulation requires monitoring of the total sulfur content of the fuel combusted in the turbine. This monitoring becomes elective if the owner or op erator can demonstrate by approved means that the fuel being fired in the turbine meets the defi nition of natural gas given in the regulation. District Rule 250 has not contained, and the ru le revision will not add, any limitations on sulfur

dioxide emissions.S TAFF R EPORT  Amendment to Rule 250 Stationary Gas Turbines

Reasonably Availabl e Control Technology

The revisions to this rule would establish for steady-state operation the same NOx emission limits as those currently estab lished for stationary gas turbines by the Sacramento Metropolitan Air Quality Management District , Yolo-Solano AQMD and other dist ricts, which are equal to or lower than the applicable st andards established by the fede ral government under 40 CFR 60 Subpart KKKK, and well below the lowest applic able standards required by Subpart GG.

Best Available Retrofit Control Technology

The Sacramento Federal Non-Attainment Area is classified by the EPA to be in severe

nonattainment of the 8-hour nation al ambient air quality standa rd for ozone. According to Section 40920 of the California Health and Safety C ode, a district with severe air pollution shall, to the extent necessary to meet the requirement that a district design a plan to achieve and maintain air quality standards by the earliest practi cable date, include in the district plan all measures required for moderate and serious nonattainment areas . One of the measures for districts with serious air polluti on is the use of the Best Ava ilable Retrofit Control Technology (BARCT) for existing permitted stationary sources. The only existing stationary gas turbines subject to the rule are operated by Roseville Electric. The District has not relied on the application of BARCT for stationary gas turbin es as a means to achieve ambient air quality

standards in the 2012 Triennial A ssessment and Plan Update. BARC T is not required, and this

rule does not establish BARCT.

ANALYSIS

The following Analysis and the subsequent Findings are intended to address the requirements set forth in the Health and Safe ty Code relating to adoption of a new or amended District Rule, as well as othe r State statutes referenced herein.

1. Cost-Effectiveness of a Control Measure

California Health & Safety Code (H&S) Section 4070 3 requires a District to consider and make public “the cost-effec tiveness of a control measure”. Emission

reductions are not an ticipated. There will be no known cost s to comply.

2. Socioeconomic Impact

H&S Section 40728, in relevant part, requires the Board to consider the socioeconomic impact of any new or amende d rule if air quality or emission limits are significantly affected. The two facilitie s where the rule is applicable are in compliance with the proposed rule amen dments. A socioeconomic impact is not anticipated.S TAFF R EPORT  Amendment to Rule 250 Stationary Gas Turbines

3. Environmental Review and Compliance

California Public Resources Code S ection 21159 requires an environmental analysis of the reasonably foreseeab le methods of compliance should be conducted. Compliance of the proposed ru le amendment is expected to already be achieved. Staff has concluded that no adverse environmental impacts will be caused by compliance with the proposed rule amendment.

According to the above conclusion, Staff fi nds that the proposed rule amendment is exempt from the California Environmen tal Quality Act (CEQA) because: (1) it can be seen with certainty that there is no possibility that the activity in question may have a significant adverse effect on the environment (CEQA Guidelines §15061(b) (3)), and (2) it is as an action by a regulatory agency for protection of the environment (Class 8 Categorical Exemption, CEQA Guidelines §15308).

FINDINGS

A. Necessity : The adoption of proposed amended Ru le 250 satisfies th e objective of the District to adopt RACT requirements.

B. Authority : California Health and Safe ty Code, Sections 40000, 40001, 40701, 40702, 40716, 41010, and 41013, are provisions of law that provid e the District with the authority to adopt this proposed amended Rule.

C. Clarity: There is no indication, at this time, that the proposed amended Rule is written in such a manner that persons affected by the Rule cannot easily

understand them.

D. Consistency: The proposed amended Rule is in harmony with, and not in conflict with or contradictory to, existing statutes , court decisions, or state or federal regulations.

E. Non-duplication: The proposed amended Rule does not impose the same requirements as an existing st ate or federal regulation.

F. Reference: All statutes, court decisions, and other provisions of law used by the District in interpreting this proposed am ended Rule are incorporated into this analysis and this finding by reference.

SUMMARY

District Staff recommend th e District Board conduct a pub lic hearing and approve the amendments to Rule 250, Stationary Gas Turbines.S TAFF R EPORT  Amendment to Rule 250 Stationary Gas Turbines

RULE 250, STATIONARY GAS TURBINES