1

MEMORANDUM DATE: April 1 , 2011 TO: Melanie King, EPA OAQPS/SPPD/ESG FROM: Tanya Parise , EC/R, Inc. SUBJECT: Summary

of the March 23, 2011 Meeting with AEA Regarding Issues Related to Rural Sources in Alaska Subject to the CINSPS

INTRODUCTION A meeting was held between EPA and the Alaska Energy Authority (AEA) to discuss AEA concerns related to stationary compression ignition (CI) engines located in remote areas of Alaska that are subject to new source performance standards (NSPS) in 40 CFR part 60, subpart IIII. EPA proposed amendments to the NSPS on June 8, 2010 (75 FR 32612). ATTENDEES Michael Horowitz, EPA Tanya Parise, EC/R (b y phone) Bob Wayland, EPA (by

phone) Chris Mello, Alaska Industrial Development and Export Authority Melanie King, EPA (b y phone) Steve Stassel, Alaska Energy and Engineering Heather Valdez, EPA (b y phone) S UMMARY OF MEETING Representatives of AEA requested to meet with EPA to discuss the unique issues affecting stationary

diesel engines in rural areas of Alaska as they relate to complying with the requirements of the CI NSPS. Prior to the meeting, AEA submitted a letter to EPA with information on the various issues facing rural source diesel engines in Alaska. 1 Only the major points discussed during the meeting are repeated here, and further details can be found in AEA’ s letter to EPA, which are available in the docket (EPA

- HQ

- OAR

- 2010

- 0295). In general, AEA expressed that it is concerned with the lack of availability of diese l engines in rural Alaskan vill ages that can meet EPA’s Tier 4 emission standards and with the high cost associated with meeting these standards in rural Alaskan villages. AEA said that it believes that the costs EPA has estimated for the rule are substantiall y lower than what compliance would realistically cost in rural portions of Alaska.

1 Letter from Chris Mello, AIDEA/AEA to Melanie King, EPA. NSPS Alaska Alternative Implementation Plan

– Rural Alaska. March 16, 2011. EPA

- HQ

- OAR

- 2010

- 0295

- 0070. 

# E C 

# / R Incorporated Providing Environmental Technical Support Since 19892

EP A noted that affected sources are not limited to acquiring only Tier 4 certified engines to demonstrate compliance. EPA pointed out that sources have the option of purchasing pre

- Tier 4 engines, for instance a Tier 3 engine, and putting aftertreatment on that engine. Further, there are several catal ys t vendors on the market who have available s ys tems for aftertreatment that have been verified b y the California Air Resources Board (CARB) and EPA. For example, there are s ys tems available that are certified to obtain at least an 85 percent reduction of particulate matter (PM) emissions that have been certified b y CARB. EPA suggested that AEA at a minimum expand the search of available compliance options for engines in Alaska. AEA noted that Caterpillar, Jo hn Deere, and Detroit Diesel are the engine manufacturers AEA purchases engines from. Those three engine makers have 90 percent of the market share and introducing new engine makers to rural Alaska is difficult, according to AEA. Manufacturers have indicated to AEA that they

cannot provide pre

- Tier 4 engines and added they believe that there are no provisions in the rule allowing this ty pe of flexibility . EPA clarified that rural portions of Alask a may have special provisions in the final rule. EPA also offered to provide AEA with control technology

vendor contact information and also talk to vendors directl y to obtain more information. Regarding maintenance, AEA indicated that engine manufact urer John Deere claims that there is no way

to maintain their filters in the field in rural Alaska . AEA said that the information for mobile sources EPA used to develop the rule for stationary engines is not applicable for stationary

engines in rural Alas ka and indicated that this is one of their points of contention. AEA said that the service intervals are much shorter on their stationary diesel engines because of higher run times and noted that a stationary diesel engine could run for 100,000 hours in p rime service. Regarding used oil blending, AEA stressed that this is an important provision for engines in rural locations of Alaska. AEA explained that it understood that if the fuel is controlled to on

specification levels (Note: O n - specification l evels and properties of used oil are defined in 40 CFR 279.11) the fuel is allowed to be burned in stationary diesel engines. AEA noted that it had estimated that the used oil blending would have to occur at less than 1 percent in order to obtain a blende d result of less than 15 parts per million (ppm) sulfur, and according to AEA, the used oil could sometimes be well above 200 ppm sulfur. EPA asked wh y the used oil would have such high sulfur content. AEA responded that sulfur is a good lubricator and th ere are oils that had high sulfur levels for lubricity purposes. In terms of the benefits associated with regulating stationary diesel engines in rural areas, AEA argued whether it was necessary to do so because in a rural community the onl y diesel engin es are at the power plant versus in an urban setting where there are numerous diesel engines. AEA does not believe that the benefits outweigh the costs of compliance for rural diesel engines in Alaska. For the reasons provided during this meeting and in additional information submitted to EPA, AEA believes there is justification for providing flexibility for rural sources in Alaska, specificall y exempting stationary diesel engines from meeting Tier 4 emission standards.