Date: March 30, 2010

To: Docket ID No. EPA-HQ-OAR-2007-0011

From: Kristin Parrish Sroka

Subject: NSPS Subpart J Review: Meeting Minutes for September 8, 2009, Conference Call Between the U.S. EPA and Represen tatives of Various Environmental Organizations

Introduction

On September 8, 2009, representatives of th e U.S. Environmental Protection Agency (EPA) and their contractor (RTI International) pa rticipated in a stakehol der conference call with representatives of the Environmental Integrity Pr oject (EIP), Galveston- Houston Association for Smog Prevention (GHASP), Industry Professional s for Clean Air (IPCA), Natural Resources Defense Council (NRDC), Earthjus tice, the City of Houston a nd the University of Texas Environmental Law Clinic. The names and affiliations of the particip ants are included in Attachment 1. The purpose of the conference call was to discuss various issues regarding the EPA’s reconsideration of NSPS subpart Ja.

Discussion

Flares

The EPA representatives began by summarizi ng the history of the flare standards in subpart Ja, beginning with the original proposal in May 2007. They noted that in the original proposal, the EPA started with na rrow applicability for new fuel gas producing units (which would cover only a small portion of flare gas genera ted at a refinery). In later versions of subpart Ja, the applicability was broadened to the flare itself and special flare modification provisions were added. The EPA representatives also noted that they plan to remove the 60 ppmv hydrogen sulfide (H 2 S) long-term concentration limit fo r flares because it is not cost effective, but they plan to maintain the 162 ppmv H 2 S 3-hour average and to require detailed flare management plans and root cause analys es for exceedances of flow rate and sulfur

thresholds.

The environmental organization representatives asked why the 60 ppmv limit was cost effective in previous versions of subpart Ja but is not cost eff ective now, given that they provided

the EPA with data that increased baseline em issions estimates. The EPA representatives responded that previously, all co mponents of the flare and fuel gas combustion device (FGCD)2

requirements were considered in one cost effectiveness evaluation, including both H 2 S concentration limits for all FGCD (including flares ), the flare management plan, and root cause analyses. However, the EPA’s current impact s analysis considers the cost and emission reduction impacts of each requirement separately. The EPA representatives stated that the latest analysis of the separate require ments shows that root cause anal ysis and flare management plans

continue to be cost effective. It also shows that most of the em issions reductions associated with the 60 ppmv H 2 S concentration limit come from heaters and boilers, so the concentration limit is cost effective for FGCD, but it is not cost effective for flares when considering the incremental reductions beyond those achieved by the other flare requirements.

The environmental organization representatives stated that in their experience, flare recovery systems save money, and they asked for further details of the EPA’s impacts analysis. The EPA representatives estimated that the first compressor in a flare gas recovery system is very cost effective, possibly saving the refinery money, and the second is less cost effective. Between those two compressors, about 90 percent reduction can be achieved. However, capturing the last 10 percent is not at all cost effective because the third compressor is rarely used ( i.e. , it has a substantial expense but does not result in much em issions reduction); in fact, capturing this last 10 percent is so cost ineffective that it causes the overall system to be not cost effective. The EPA representatives added th at other practices, such as managing planned startups and shutdowns, can reduce that last 10 pe rcent at a lower cost than a third compressor, and the flare management plan in subpart Ja in cludes startup and shut down minimization as well as a description of every r outine stream going to the flare and why it must be flared.

The environmental organization representativ es suggested that the EPA include an equipment standard or a work practice standard th at requires the use of one or two compressors, depending on the results of the cost effectiveness analysis. They stated that a clear requirement to install certain technology is mu ch easier for states and other de legated authorities to enforce than flare management plans and flow monitoring. They noted that delegated authorities will be overwhelmed by the monitoring and reporting requi rements and will be unable to keep up with everything to make sure that facilities are following those plans. The environmental organization representatives stated that if the final amendments to subpart Ja do not require the installation of technology, the preamble should cl early state why not. The EPA representatives noted that a technology standard for flares c ould affect the flare modificati on provisions as well. The EPA representatives also noted that the current draft of the final am endments to subpart Ja is close to the Bay Area Air Quality Management Distri ct and South Coast Air Quality Management District rules; the main differe nce is that those rules require no routine flaring and, therefore, have a higher estimated cost for compliance.

The environmental organization representativ es asked if the EPA had thought about low flow requirements or flare e fficiency requirements as part of subpart Ja. The EPA representatives responded that they are looking at the use of the flare as a control device and doing studies to learn more about the efficiency and emissions re duced by flares. They noted that they are interested in issues such as how flare efficiency affects compliance with 40 CFR 63.18 and 40 CFR 60.11, overall flare minimization, and New Source Review.3

Process Heaters

The EPA representatives began by summarizi ng the history of the nitrogen oxides (NO X ) standards in subpart Ja, beginning with the origin al proposal in May 2007. Th ey stated that they are considering a limit of 40 ppmv for natural draft process heater s and 60 ppmv for forced draft process heaters (including newly constructed forc ed draft process heaters, for which a limit of 40 ppmv NO X was proposed) based on a 30-day aver aging period. The environmental organization representatives asked the EPA to e xplain why they were raising the limit for new forced draft process heaters, a nd the EPA representatives responde d that the data currently inhand supported the higher 60 ppmv limit rather than the 40 ppmv limit. The EPA representatives stated that the data was already available in the project docket, and the environmental organization representatives had pr eviously received a copy. The EPA representatives also noted that they had requested additiona l data from the petroleum refini ng industry and stated that they

would share the new data when they are received.

The EPA representatives then stated that th ey are considering options for how to handle turndown conditions. They noted that the change in averaging time from 24 hours in the final rule to 365 days in the supplemental proposal was aimed to address the turndown issue. However, industry representatives have indicat ed that this longer averaging time did not adequately address turndown for units that oper ated for significant period in turndown, so the EPA is considering including a mass limit equivale nt to the mass allowed at 50 percent capacity and revising the averaging time for the concentra tion- and heating value- based emission limits to 30 days. The environmental organization represen tatives then asked why the EPA is considering an averaging time of 30 days fo r the 40 and 60 ppmv limits, instead of shortening the averaging time back to the original 24 hours. The EPA re presentatives stated th at the 30-day averaging time is supported by current data.

Regarding collecting additional data, the EPA representatives noted that some consent decrees require refinery owners and operators to submit CEMS data to the EPA. They suggested that a more systematic approach to data gathering (rather than just asking industry to send data of their choosing) might yield more data. (They di d note that smaller process heaters typically do not have CEMS, so data on turndown conditions fo r small process heaters would be limited.) The environmental organization representatives agr eed with that idea and noted that while they do not necessarily disagree with the EPA’s re vised emission limits, they do want to see representative data to suppor t the conclusion that those are the appropriate limits.

Other Issues

The EPA representatives stated that they know there are other areas of concern for the environmental organization representatives that will not be addressed in this rulemaking ( e.g. , limits for fluid catalytic cracking units). The EP A representatives explained that all the issues are being considered as part of an industry sector approach, a nd they plan to re-evaluate the

standards based on data collected as part of the consent decree process. As part of this sector effort, the EPA representatives listed several i ssues they would like to consider, including: (1) VOC standards for heat exchange systems ( HAP standards are being finalized as part of Refinery MACT 1 review); (2) addressing poten tial gaps in the NSPS for boilers, such as4

turndown operations and combustion of refinery fu el gas; (3) possible additional standards for delayed coking units; (4) addressing quench wate r tanks and ponds associated with delayed coking units, particularly tanks and ponds that are uncovere d and possibly including work practices for steam; and (5) what processes mi ght be appropriate to address with CTG in

nonattainment areas.

Finally, the EPA representatives noted that da ta gathering efforts for this rulemaking are somewhat limited by timing. They noted they plan to send out a comprehensive survey under CAA section 114 authority in the near future, an d if they send one company a request for NO X data for process heaters now, they cannot follo w that request too closely with a request to complete the comprehensive survey. Therefore, it will be important to consider the value and timing of each request for each company to ensure that the EPA is able to collect the best and most representative data.Attachment 1 Participants in September 8, 2009, Conference Call

Environmental Organiza tion Representatives Ann Alexander, NRDC Tim Ballo, Earthjustice Kate Fendler, EIP Kelly Haragan, University of Texas Environmental Law Clinic Layla Mansuri, EIP Elena Marks, City of Houston Jennifer Peterson, EIP Lucy Randel, IPCA Eric Schaeffer, EIP Matt Tejada (GHASP)

U.S. EPA Representatives Pat Foley

Jodi Howard

KC Hustvedt

Brenda Shine

RTI International (EPA contractor)

Jeff Coburn

Kristin Parrish