Document ID: EPA-R04-OAR-2017-0136-0002
Agency: epa
Document Type: Supporting & Related Material
Title: 
Posted Date: 2017-05-11T04:00Z

Shelby County, Tennessee 
                                       
                                       
                            RVP Relaxation Request
                                       
                                       
		for the
                                       
                                       
                     7.8-psi Gasoline Volatility Standard
                                       
                                       
                                       
                                       
                                       
                                       
                                       
                                       
                                       
                                       
                                       
                                       
                                       
                                 Prepared by:
                                       
                        Shelby County Health Department
                           Pollution Control Section
                             814 Jefferson Avenue
                           Memphis, Tennessee 38105
                                       
                               February 27, 2017
                               Table of Contents

1.0	Petition for Relaxation of summertime Reid Vapor Pressure (RVP) in
	Shelby County, Tennessee								1

2.0	Technical Demonstration					                  		1

2.1 	Ambient Air Quality 									2

2.2	Noninterference Demonstration 							3

      2.21	Lead (Pb) NAAQS								3
	2.22	Sulfur Dioxide (SO2) NAAQS						4
	2.23	Nitrogen Dioxide (NO2) NAAQS						4
	2.24	Particulate Matter 2.5 (PM2.5) NAAQS					4
	2.25	Carbon Monoxide (CO) NAAQS						5
	2.26	Ozone (O3) NAAQS								5

2.3	Ineffectiveness of Control Measure 							5

2.4 	Economic Impacts 									6

	2.41	Increased Cost 								6
	2.42	Infungible Gasoline Supply 							7

2.0	Conclusion 										7
							

                                       
                                       
LIST OF ACRONYMS

Acronym 		Definition
AIRS 			Aerometric Information Retrieval System
APC			Division of Air Pollution Control, Tennessee Department & Conservation
CAA		 	Clean Air Act
CFR 			Code of Federal Regulations
CO 			Carbon Monoxide
DV 			Design Value
EPA 			U.S. Environmental Protection Agency
FR 			Federal Register
HC			Hydrocarbons
MSA 			Metropolitan Statistical Area
NAAQS 		National Ambient Air Quality Standard
NOx 			Nitrogen Oxides
O3			Ozone
Pb			Lead
PM2.5			Particulate Matter size 2.5 x 10[-6] μ
ppb 			parts per billion
ppm 			Parts per million
RVP			Reid Vapor Pressure
SCHD-PCS		Shelby County Health Department  -  Pollution Control Section
SIP 			State Implementation Plan
TDEC 			Tennessee Department of Environment and Conservation
TN-AR-MS		Tennessee -Arkansas-Mississippi
TPD			Tons Per Day or tons/day
VMT 			Vehicle Miles Traveled
VOC 			Volatile Organic Compounds

1.0	Petition for Relaxation of summertime Reid Vapor Pressure (RVP) in Shelby County, Tennessee

Under the amended Phase II regulations (56 FR 64706), a nonattainment area that is subsequently redesignated attainment can petition EPA for a rulemaking that revises the RVP standard from 7.8-psi to 9.0-psi for that area.  The Pollution Control Section of the Shelby County Health Department (Department), through the Tennessee Air Pollution Control Board representing the Governor of the State of Tennessee, is formally petitioning the EPA to revise the provisions of 40 CFR §80.27(a)(2)(ii) and relax the federal summertime gasoline RVP standard in Shelby County, Tennessee from 7.8-psi to 9.0-psi during O3 season. 

2.0	Technical Demonstration

On January 19, 2016, the Department, through the Tennessee Air Pollution Control Board, submitted to EPA a Redesignation Request and Maintenance Plan for the 2008 O3 NAAQS. Subsequently, that plan was approved and EPA redesignated Shelby County to attainment effective July 25, 2016 (81 FR 40817).  While that plan serves as the foundation and basis for this relaxation request, in accordance with EPA guidance, the supporting documentation and emission inventories will not be incorporated here because they have already been subject to a rulemaking and were approved.

However, in reference to the emission inventories included in the approved plan, the RVP inputs used for all mobile equipment for the 2012 base-year emission estimates of NOx and VOC were developed using the federally imposed 7.8-psi RVP standard, while the 2017, 2020, and 2027 maintenance year emission estimates of NOx and VOC were developed using 9.0-psi RVP. 

The technical demonstration that follows shows that RVP relaxation during O3 season from 7.8-psi to 9.0-psi will not interfere with attainment and maintenance of the O3 NAAQS in Shelby County, Tennessee.  Furthermore, arguments are advanced to show that it is an ineffective ozone control measure which results in a negative economic impact on the area.

2.1 Ambient Air Quality -

Ambient air quality monitoring for O3 is conducted at several sites throughout Shelby County.  A map showing the location of each O3 monitor is provided below in Figure 1.

Figure 1  -  Map of the Shelby County, Tennessee Ozone Monitors

Historical 8-hr O3 DVs are displayed in Table 1 along with the name identifying the monitor(s) from which the value was obtained. These values represent the highest O3 concentrations obtained from the three monitors operated in Shelby County during the specified time period. The table shows the steady reduction in ground-level O3 concentrations that have been achieved over time. 

Table 1. Memphis Area 8-hr Ozone Design Value Trend, 1996-2015
 

                              3-Year Design Value
                                  Ozone (PPM)
                                  Monitor(s)
                              3-Year Design Value
                                  Ozone (PPM)
                                  Monitor(s)
                                   1994-1996
                                     0.094
                                    Frayser
                                   2004-2006
                                     0.080
                                    Orgill
                                   1995-1997
                                     0.095
                                    Frayser
                                   2005-2007
                                     0.082
                                    Frayser
                                   1996-1998
                                     0.092
                                Frayser/ Orgill
                                   2006-2008
                                     0.082
                                    Frayser
                                   1997-1999
                                     0.095
                                Frayser/ Orgill
                                   2007-2009
                                     0.077
                                    Frayser
                                   1998-2000
                                     0.097
                                    Orgill
                                   2008-2010
                                     0.075
                                    Frayser
                                   1999-2001
                                     0.093
                                Frayser/ Orgill
                                   2009-2011
                                     0.074
                                    Frayser
                                   2000-2002
                                     0.090
                                    Orgill
                                   2010-2012
                                     0.079
                                    Frayser
                                   2001-2003
                                     0.089
                                    Orgill
                                   2011-2013
                                     0.078
                                 Shelby Farms
                                   2002-2004
                                     0.084
                                    Orgill
                                   2012-2014
                                     0.073
                             Frayser/ Shelby Farms
                                   2003-2005
                                     0.081
                                    Orgill
                                   2013-2015
                                     0.067
                             Frayser/ Shelby Farms

For illustration, the three year O3 DVs indicated in the table above are plotted in Figure 2. Again, these values indicate the downward trend in 8-hour O3 concentrations that are expected to continue through 2027. 

Figure 2. Shelby County, Tennessee 8-hr Ozone Design Value Trend, 1996-2015

O3 air monitoring data through 2015 shows Shelby County is meeting the 2008 8-hour ozone NAAQS of 0.075 ppm, as well as the new 2015 8-hour ozone NAAQS of 0.070 ppm.  The preliminary DV through the 2016 monitoring season remains 0.067 ppm.

2.2 Noninterference Demonstration

The CAA Section 110(l) prohibits EPA from approving any proposed SIP revision that would interfere with the attainment and maintenance of the NAAQS in effect at the time of the revision. The "Noninterference Demonstration" that follows is provided to illustrate that the use of 9.0-psi RVP gasoline in the Shelby County ozone maintenance area will not interfere with the attainment or maintenance of any NAAQS.

2.21 Lead (Pb) NAAQS

In 2008, EPA lowered the rolling 3-month average Pb NAAQS to 0.15-g/m[3].  Based on ambient Pb monitoring data obtained from monitors within Shelby County from 2013 through 2015, the highest rolling 3-month average design value for Pb was 0.0047-ug/m[3] (or 0.00- ug/m[3] due to rounding). Shelby County is currently classified as attainment for the Pb NAAQS. 

Moreover, mobile source emissions of Pb are associated with the Pb content of gasoline.  Due to the elimination of Pb in gasoline, the emissions of Pb from gasoline-powered on road vehicles have virtually been eliminated.  Therefore, a 9.0-psi RVP standard will not affect lead emissions and will therefore not interfere with the ability of Shelby County to attain or maintain the Pb NAAQS.
2.22 Sulfur Dioxide (SO2) NAAQS

In 2010, EPA established a new primary 1-hour SO2 NAAQS of 75 ppb. This action was accompanied by the revocation of the existing 24-hour SO2 NAAQS of 140 ppb and the annual SO2 NAAQS 30 ppb, however, EPA announced that they remain in effect for 1-year following the effective date of designation for the 2010 1-hour NAAQS. In 2012, EPA retained the 3-hour and 24-hour NAAQS for all areas that have not been designated attainment SO2 emissions from mobile sources are related to sulfur content of the fuel and are not affected by changes in RVP.  A 9.0-psi RVP standard will not affect SO2 emissions and will therefore not interfere with the ability of Shelby County to attain or maintain the SO2 NAAQS.

2.23 Nitrogen Dioxide (NO2) NAAQS

In 2010, EPA established a new 1-hour NO2 NAAQS of 100 ppb and retained the existing annual NO2 NAAQS of 53 ppb.  Based on ambient NO2 monitoring data obtained from monitors within Shelby County from 2013 through 2015, the highest annual NO2 design value was 7 ppb and the highest 1-hour NO2 design value was 39 ppb.  Shelby County is currently classified as attainment for the NO2 NAAQS.

Moreover, as shown in the emissions inventories provided with the approved redesignation request and maintenance plan, mobile source NOx emissions are projected to decline in the future no matter which RVP standard applies.  Therefore, a 9.0-psi RVP standard will not affect NO2 emissions and will therefore not interfere with the ability of Shelby County to attain or maintain the NO2 NAAQS.

2.24 Particulate Matter 2.5 (PM2.5) NAAQS

In 2006, EPA retained the annual PM2.5 NAAQS of 15-ug/m[3] and lowered the 24-hour PM2.5 NAAQS to 35-ug/m[3].  In 2012, EPA revisited the standard and lowered the annual PM2.5 NAAQS to 12-ug/m[3] and retained the 24-hour PM2.5 NAAQS of 35-ug/m[3].  Based on ambient PM2.5 monitoring data obtained from monitors within Shelby County from 2013 through 2015, the highest annual PM2.5 design value was 9.12-ug/m[3] and the highest 24-hour PM2.5 design value was 19.17-ug/m[3].  Although, PM2.5 monitoring data indicates that Shelby County is meeting both the 2006 and the 2012 PM2.5 NAAQS, currently, EPA has deferred the area's designation.

Furthermore, the precursor emissions involved in ambient PM2.5 formation are SO2, NH3, NOx, and VOC.  As mentioned earlier, SO2 emissions from mobile sources are strictly associated with the sulfur content of the fuel and are not affected by changes in RVP.  NH3 emissions from mobile sources increase under more aggressive driving conditions and when the SO2 fuel content of fuel is decreased; and thus will not be affected by changes in the RVP.  Although NOx and VOC emissions are by-products of gasoline combustion, emissions of both of these pollutants are projected to decline in the future regardless of the RVP standard applied.  Therefore, a 9.0-psi RVP standard will not interfere with the ability of Shelby County to attain or maintain the PM2.5 NAAQS.

2.25 Carbon Monoxide (CO) NAAQS

In 2011, EPA retained the primary 8-hour CO NAAQS of 9 ppm and 1-hour CO NAAQS of 35 ppm.  Based on ambient CO monitoring data obtained from monitors within Shelby County from 2013 through 2015, the highest CO design value for the 8-hour standard is 3.6 ppm and for the highest 1-hour standard is 7.7 ppm.  The CO monitoring data clearly shows that the observed concentrations are well below the 8-hr and 1-hr CO NAAQS. Consequently, Shelby County is currently designated attainment for the 2011 CO NAAQS.

CO emissions are by-products of gasoline combustion. However, mobile source emissions are predicted to decline in the future no matter which RVP standard is applied. Therefore, a 9.0-psi RVP standard will not interfere with the ability of Shelby County to attain or maintain the CO NAAQS.

2.26 Ozone (O3) NAAQS

In 2008, EPA lowered the 8-hour O3 NAAQS to 0.075 ppm.  In 2015, EPA revisited the standard and lowered it to 0.070 ppm.  Based on ambient O3 monitoring data from 2013 through 2015, the O3 design value for all monitors within Shelby County is 0.067 ppm.  Shelby County is currently designated attainment for the 2008 8-hour O3 NAAQS.  Furthermore, based on historical data, the current DV of 0.067 ppm indicates the area will meet the revised 2015 O3 NAAQS when designations are made. 

The precursor emissions involved in ambient O3 formation are NOx, and VOC.  As demonstrated in the previously approved SIP (81 FR 40817), NOx and VOC emissions are projected to be trending downward in the future.  Comparatively, the 2027 emissions of NOx and VOC, which are 12.51 and 5.82 tons per day, are significantly less than the values indicated for the 2012 attainment year, which are 61.56 and19.01 tons per day, respectively.  The downward trend in these emissions estimates are demonstrated without regard to the RVP standard imposed.  Thus, it is apparent that a 9.0-psi RVP standard would not have an adverse impact on mobile source emissions of NOx and VOC and therefore, will not interfere with the ability of Shelby County to maintain the 2008 O3 NAAQS through the ten-year maintenance period ending in 2027, and will not interfere with attainment of the 2015 O3 NAAQS.

2.3 Ineffectiveness of the Control Measure

Federal RVP regulations cited in 40 CFR 80.27, promote a strategy aimed at reducing ground level O3 formation by controlling the emissions of volatile organic compounds (VOC) that are produced by gasoline-powered engines.  Although in the past, some benefit was derived from the application of this regulation, the 7.8-psi RVP gasoline standard has minimal effect assisting Shelby County in maintaining the current or future O3 NAAQS.  Primarily, this is because Shelby County is located in a region of the country where biogenic sources generate a high proportion of VOC emissions.  Emission inventory analysis developed for and submitted with the recent Shelby County Redesignation Request shows biogenic sources accounted for 80 tons of VOC emissions per day during ozone season in 2012 which is 44.30% of all VOC emissions in Shelby County.  The amount of VOC emissions eliminated with reduced RVP gasoline is small enough to render it minimally effective in controlling ground level O3 formation in this region.  Thus providing further evidence that changing the RVP standard from 7.8-psi to 9.0-psi would not interfere with the ability of Shelby County to maintain the 2008 or 2015 O3 NAAQS. 

2.4 Economic Impacts  -  The 7.8-psi RVP standard constrains Shelby County's economy and makes the regional gasoline supply infungible 

As a control measure, the 7.8-psi RVP gasoline standard has an insignificant impact on ground level O3 formation in Shelby County.  In corollary, the application of this RVP standard has caused detrimental outcomes, as follows:
   1. The local economy is strained from the adverse impact of increased gasoline prices during O3 season,
   2. The regional gasoline supply is adversely impacted by making it infungible and inconsistent. 

2.41 Increased Cost

The implementation of the 7.8-psi RVP gasoline standard increases the cost that consumers pay at the pump which has an adverse impact on the economy in Shelby County.  According to the report titled, "Refining Economics of a National Low Sulfur, Low RVP Gasoline Standard", a study performed by MathPro Inc. on behalf of The International Council for Clean Transportation, the refining cost of gasoline with 7.8-psi RVP is approximately $0.088/gal, while the refining cost of gasoline with 9.0-psi RVP is $0.039/gal.  Based upon operations data obtained from the Form 10-k for fiscal year ended December 31, 2009 for Valero Refinery located in Memphis, 195,000 barrels of crude oil are processed per day.  Approximately 54% of this crude oil goes into the production of an average of 4,422,600 gallons of gasoline daily.  

It is generally understood that almost all of Valero's production is distributed regionally.  Without access to detailed sales and market data, we will assume fuel distribution is apportioned over the area on a per capita basis.  Recent census data estimates the population of the Greater Mid-South Area at 2.4 million.  This area is larger than the consolidated metropolitan statistical area and is assumed to reflect geographical market reach.  The 2015 census estimates the population of Shelby County at 939,672.  This represents 39% of the total regional population.  Therefore, we assume Valero makes and distributes an average of 1,724,814 gallons of 7.8 RVP gasoline to Shelby County every day during ozone season.

As shown below in Table 2, during the 107 days of ozone season, the estimated additional annual cost to Shelby County residents for the local refinery to produce gasoline with 7.8 rather than 9.0 RVP gasoline is $9,043,200.  Note that we believe this is a conservative estimate because it only accounts for 7.8 RVP gasoline produced by the local refinery.  Though Valero is the largest regional supplier of gasoline, other companies have some unknown amount of market share.

Table 2
                                RVP            
                                   Gasoline 
                           Per Gallon Refining Cost
                               Ozone Season Days
            Total                      Estimated               Cost
                                     (psi)
                                    gal/day
                                     $/gal
                                     #days
                                      ($)
                                      7.8
                                   1,724,814
                                     0.088
                                      107
                                  16,240,849
                                       9
                                   1,724,814
                                     0.039
                                      107
                                   7,197,649
Estimated Annual Additional Cost to Shelby County Residents
                                   9,043,200

2.42 Infungible Gasoline Supply

The application of the 7.8-psi RVP gasoline standard in Shelby County, with the exclusion of other jurisdictions within the Memphis, TN-AR-MS MSA, causes the regional gasoline supply to be infungible and inconsistent.  During periods of disruption in fuel production or distribution, an infungible gasoline supply can lead to fuel shortages and even higher costs to local residents.  Setting a 9.0-psi RVP gasoline standard in Shelby County, Tennessee will establish a fungible gasoline supply, making the gasoline distributed and marketed in Shelby County, Tennessee equivalent to that distributed in the rest of the region. 

3.0 Conclusion -

The data presented in this petition demonstrates that relaxing the federal RVP gasoline standard from 7.8-psi to 9.0-psi will not interfere with attainment and maintenance of any NAAQS in Shelby County, Tennessee, for the following reasons. 

   * The O3 ambient air quality data obtained from the air monitoring stations located within Shelby County is trending downward (see Figure 2).   The 2015 O3 DV is 0.067 ppm, which meets both the 2008 and the 2015 8-hour O3 NAAQS.   The preliminary 2016 O3 DV remains 0.067 ppm.  This occurred during a season that saw weather patterns particularly conducive to forming high concentrations of ground-level O3.

   * NOx and VOC emission inventories are also trending downward.  Due to the NOx limited environment in Shelby County, as NOx emissions decrease ground level O3 formation will experience a simultaneous decrease.

   * The 7.8-psi RVP standard is an ineffective control strategy in Shelby County as it targets VOC emissions reductions instead of NOx emissions reductions which are more effective in reducing ground level O3 formation in a NOx limited environment.

   * The 7.8-psi RVP standard causes an unnecessary burden on the consumers of Shelby County each summer because of increased gasoline costs.

   * The 7.8-psi RVP standard creates an infungible gasoline supply that can result in shortages and further increased costs during periods of fuel supply disruption. 

All of the above illustrate why the more restrictive RVP standard of 7.8-psi is no longer needed in Shelby County, Tennessee.