### Fw: Summary of Interagency co mments submitted under EO12866 on EPA's draft Final PSD and TitleV

GHG Tailoring Rule

Michael Ling

to:

Pam Long

05/13/2010 10:58 AM

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OMB docket item #3

Michael Ling

Associate Director

Air Quality Policy Division

U.S. EPA - OAQPS

(919) 541-4729

-----Forwarded by Michael Ling/RTP/USEPA/US on 05/13/2010 10:58AM -----

To: Michael Ling/RTP/USEPA/US@EPA

From: "King, Heidi R." <Heidi_R._King@omb.eop.gov>

Date: 05/03/2010 02:48PM

Subject: Summary of Interagency comments subm itted under EO12866 on EPA's draft Final PSD

and TitleV GHG Tailoring Rule

Michael,

Attached is a summary of interagency comments on the draft Final Tailoring rule preamble. The

comments were submitted to OIRA by interagency reviewers under EO12866.

Best regards,

heidi 

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### Summary of Interagency Work ing Comments under EO 12866

***Subject to Further Policy Review***

1 1. In reviewing the rule and accompanying RIA, it seems that EPA could decide not to include

biogenic carbon under the rule until further analysis is conducted. EPA has the discretion to

cover biogenic sources of carbon as part of Step 3 of the rule which requires EPA to promulgate

by July 1, 2012, on the consideration of phasing

‐ in additional sources. As part of this approach,

EPA could commit to complete a study of the implications of including biogenic carbon by April

30, 2015.

2. Pages 361

‐ 362: There is discussion on the rationale of the lack of an applicability exclusion for

biogenic emissions and biomass fuels or feedstocks and it is noted “...this issue warrants further

exploration in that context, and we plan to fully explore it and take action as appropriate”. It is

not clear if the issue that warrants further exploration is an approach to carbon accounting to

take into consideration carbon neutrality or if the issue is the development of guidance on BACT

to offer relief to biogenic emission requirements. We suggest this be clarified further.

3. Several reviewers recommended that biogenic carbon sources should be evaluated in terms of

their net contributions (emissions

‐ removals). This approach is used in the IPCC GHG Inventory

Methods, in guidance provided under the 1605(b) Voluntary Greenhouse Gas Registry, and is

relied on in the preparation of the Official Inventory of GHG Emissions and Sinks (prepared by

EPA for submission to the UNFCCC each year). This premise is also the basis of EPA’s use of

lifecycle analysis in the RFSII.

4. Please clarify whether this rule refers to short tons or metric tons, and clarify whether this is the

same as other related regulatory actions and programs. Is it possible to adopt metric tons to be

consistent with other programs? Internationally, metric tons are standard, and as [the

preamble] notes, metric tons are called for domestically for some items. Several reviewers

suggested that adopting metric tons from the start would be simpler.

5. In order to more accurately identify the potential impacts of this and other air quality

regulations on the agricultural industry, USDA offers to engage in collaborative discussion with

EPA to better define “source” and other relevant permitting terms in relation to agricultural

operations, which have some very unique differences in comparison to traditionally

‐ permitted

commercial and industrial sources.

6. EPA could consider developing an implementation schedule for these updated Title V permit

applications that would allow Title V facilities to submit amended applications over a three to six

month period, and would stagger the burden on the air permitting resources. When GHG

emissions are established as an air pollutant, existing Title V facilities will have to inventory their

operations to ensure that all emissions units at the facility are accurately categorized. There

would be two different types of emissions units subject to such an inventory: (1) re

‐ categorizing

emissions units that no longer qualify as trivial or insignificant; and (2) initially listing emissions

units emitting only GHGs that are subject to regulation for the first time (e.g. electrical

equipment, wastewater treatment). It is expected that all Title V facilities would need to

inventory all existing equipment and review existing operations when GHG emissions become

an air pollutant. Many of these Title V facilities will need to amend their Title V permit

applications to include re

‐ categorized or initially listed emissions units.

### Summary of Interagency Work ing Comments under EO 12866

***Subject to Further Policy Review***

2 7. EPA could describe how it will determine the potential to emit for Title V and PSD for equipment

containing greenhouse gases. In other words, if a facility has one hundred pounds of sulfur

hexafluoride in factory

‐ sealed electrical equipment, does that equate to a potential to emit of

1,150 tons of CO2e emissions? Since the SF6 could only be released due to catastrophic failure,

should it be considered "potential to emit"?

8. Applicability of Significance Levels near Class I areas:

Because GHG emissions contribute to GHG concentrations that are uniform throughout the

atmosphere, the proximity of a source to a sensitive area is not relevant to determining how

much harm that source’s GHG emissions will cause to that area. Hence, several reviewers

suggested that it does not appear to be necessary or logical to have a lower significance

threshold for sources merely because they are near a Class I area. Further, since GHG emissions

from a source are generally over a thousand times higher than any other pollutant emitted,

even the smallest of modifications would exceed the significance threshold for a Class I area.

As further background on this issue, the preamble to the final rule states that criteria pollutant

significance levels were set by modeling an emission rate that would yield an impact of

approximately 4% of the National Ambient Air Quality Standard (NAAQS) for a given pollutant.

EPA then conducted a modeling analysis to determine how far from a Class I area a typical

source would need to be located so as not to exceed a modeled concentration of 1 μg/m 3

. The

product of that analysis yielded a distance of 10 kilometers. This methodology should not be

used to restrict GHG emissions, since GHGs are not subject to a NAAQS. EPA has not provided

any evidence to demonstrate that GHG emissions greater than 1 μg/m 3 would harm or prove

detrimental to a Class I area.

Additionally, GHG emissions are not required to be modeled, as all areas are considered to be in

attainment for GHGs. GHGs are not NAAQS pollutants. However, if EPA does not amend 40

C.F.R. § 52.21(b)(23)(iii) to exclude GHGs, GHG emissions near Class I areas would have to be

modeled. Air pollution modeling is conducted to determine the concentration of a pollutant in

the air from a new or modified source. Since there will not be a NAAQS to compare any

modeling result to, the modeling does not serve a useful purpose.

40 CFR §52.21(b)(23)(iii) could be modified to read, “Notwithstanding paragraph (b)(23)(i) of this

section, significant means any emissions rate or any net emissions increase, with the exception

of greenhouse gas emissions, associated with a major stationary source or major modification,

which would construct within 10 kilometers of a Class I area, and have an impact on such area

equal to or greater than 1 μg/m 3

, (24

‐ hour average).” This amendment to 40 CFR

52.21(b)(23)(iii) will ensure that whatever significance level EPA adopts for GHGs generally will

also apply to sources within 10 kilometers of Class I areas.