Frequently Asked Questions
Rule 802 - Nonattainment Review
* means that the question is taken out of Section 8
of the NSR Staff Report.
For more information or assistance, call the Engineering Division at (805)
961-8800, or e-mail us at engr@sbcapcd.org.
Q: Sources may be subject to rules that are in the approved SIP even if
those rules are not current district rules. If there are two versions of a rule,
one SIP approved and submitted for inclusion in the SIP, which version of the
rule does a facility have to comply with?
A: Rule 802 Section G.5 states "The control officer shall issue an Authority
to Construct for major new stationary source or major modification to a
stationary source, which is subject to this rule, only if all District
Regulations contained in the State Implementation Plan submitted to the
EPA are being carried out in accordance with that plan." However, EPA has
authority to enforce the SIP approved version of a rule. Therefore, in
cases where there are two versions of a rule, one approved into the SIP and the
other submitted by the District to EPA awaiting approval into the SIP, sources
must comply with both versions of the rule. Where the rules are in conflict, the
source must comply with the most stringent provisions of both rules. EPA has
been working with Santa Barbara APCD to prioritize EPA review of rules that have
been submitted for SIP approval. This should help to minimize disparities
between district rules and SIP approved rules.
Q: Does the BACT threshold of 25 pounds per day or greater allow for
decreases during the application? During subsequent applications that are
considered the same project for modified sources?
A: According to the ARB, the intent for changeover to the PTE basis (H&SC
40918) was to eliminate the possibility of "netting out" of BACT. As such, only
the increases are evaluated against the 25 lb/day threshold. This also applies
to the APCD's definition of project. In both cases, if an application proposed
emission decreases they may not be used to reduce the PTE for determining BACT
applicability.
Q: Do all emission reductions have to clear through the bank or can an
operator use on-site emission reductions to meet emission reduction
requirements?
A: This question is really one of netting. Can a source "net out" of emission
offset requirements by using on-site emission reductions to reduce the net
emission increase of a modification to below the emission threshold that
triggers offsets? The answer is yes. However, be aware that for nonattainment
pollutants the APCD uses the dual source definition. This means that for the
modification, an operator cannot use on-site emission reductions to net out of
an offset requirement. Such reductions may, however, be used as offsets at the
offset trading ratio. For a new modification where the modification does not
trigger nonattainment offset requirements by itself, but where the entire source
may trigger offsets, and for attainment pollutant offset requirements, an
operator can use on-site reductions to avoid offsets. See the later discussion
in this section on the issue of netting.
Q: hen measuring the distance from the source supplying offsets to the
source using offsets to determine offset ratios, will the APCD measure between
emission units or stationary source boundaries?
A: When determining if the location of offsets is within 7.5 miles of the
location of the ATC source as specified in Rule 802 Table 4, the distance is
determined by measuring between the two stationary source boundaries.
Q: For offsets, is any grandfathering proposed? For example, a source
could have a net emission increase above 10 tons per year since 1990 which would
not require offsetting under current rules. However, under the proposed rule any
emission increase at such source would require the source offset the full 10
tons per year.
A: The source would be required to offset the full net emission increase.
Q: Can a source net out of Best Available Control Technology for
nonattainment pollutants?
A: No. Netting pertains only to new source review triggers that are based on
net emission increase. Netting therefore cannot be used for nonattainment Best
Available Control Technology because a trigger based on potential to emit is
proposed for use as the Best Available Control Technology trigger for
nonattainment pollutants.
Q: Can a source net out of offsets for nonattainment pollutants?
A: The dual source definition applies to the offset trigger for nonattainment
pollutants. This is current APCD practice. Thus, the determination of whether
offsets are triggered for nonattainment pollutants is a two step process. First,
the net emission increase of a proposed modification is calculated. If the
modification by itself triggers offsets, then offsets apply. If the modification
by itself does not trigger offsets, then the net emission increase from the
modification is added to net emission increase for the entire source. If the net
emission increase for the entire source exceeds the offset trigger, then offsets
are required. Netting is allowed on the calculation of source wide net emission
increase. That is, creditable decreases at a source can be used to reduce the
net emission increase resulting from a modification to avoid triggering emission
offset requirements.
Q: Do the proposed rules allow a source to subtract the actual
emissions of the equipment being replaced when calculating the NEI of the
modification in the first step of the dual source calculation?
A: A source can subtract actual emissions (based on the definition of
Actual Emission Reductions in Rule 102) of the equipment being replaced provided
the new equipment is the same type as the old. For example, a boiler replacing a
boiler, or an I.C. engine for an I.C. engine. Netting out is not allowed in the
case of one emissions unit type 'x' replacing emission unit type 'y' under the
guise they both perform the same function. For example a source would not be
allowed to subtract emissions from a boiler if they were replacing it with a
turbine even though both products produce steam. This is the only exception
allowed under the dual source definition. As always, deductions are always
allowed for all reductions in calculating the facility wide NEI.
Examples of the replacement netting out policy follow (note in the following
examples the replacement does not qualify for exemption under the
"equivalent routine" exemption provided by Rule 202D.9).
Example 1
Given:
1990 NEI = 0 (source was all pre 1990)
Boiler X 15 tpy PTE, 10 tons actual
Boiler Y replacement boiler, 15 tpy PTE
Find: If offsets are required.
Solution:
First find NEI of Modification (Step 1)
Mod NEI = 15 - 10 = 5
Offsets not triggered.
Next find Facility Wide NEI = I + (P1 - P2) -D (Step 2)
FW NEI = 15 + (0 - 0) - 10 = 5 tpy
offsets not triggered
Example 2
Given:
Source's NEI before modification = 15 tpy (from equipment other than X & Y)
Boiler X Pre 1990, 12 tpy actual, 20 tpy of permitted emissions
Boiler Y replacement boiler, 11 tpy permitted emissions
Find: If offsets are required.
Solution:
First find NEI of Modification (Step 1)
11 - 12 = -1 tpy.
Since the NEI of the modification is less than the Offset threshold no offsets
are required by the modification half of the dual source definition.
Next find facility wide NEI = I + (P1 - P2) - D (Step 2)
FW NEI = 11 + (15 - 0) - 12 = 14
14 tons is greater than the trigger level offsets are required, but since the
modification itself was a decrease (-1 tpy), no offsets would be required.
Example 3
Given: NEI = 20 tons per year (from equipment other than X & Y)
Boiler X Pre 1990, 15 tpy PTE, 6 tpy actual emissions
Boiler Y replacement, 15 tpy PTE
Find: If offsets are required.
Solution:
Modification NEI (Step 1)
NEI Mod = 15 - 6 = 9
Offsets not triggered
Facility Wide NEI = I + (P1 - P2) - D (Step 2)
15 + (20 - 0) - 6 = 29 Offsets Triggered
29 tons must be offset
Q: When is a source no longer considered a "new source", once the PTO
for the new source is issued? How is the NAR BACT criteria applied if a new
source has obtained an ATC permit, initiated construction, is still in the SCDP
phase and is submitting ATC Modification applications. Are the ATC Modification
application(s) treated as a modified source or still as the new source under
Section C.1?
A: Rule 102 defines a "new source" as any stationary source which will emit
any air contaminant not previously emitted at that location. That determination
was made during the initial ATC permit phase. Until the source obtains a PTO for
the equipment and processes subject to the ATC, any subsequent ATC Modification
applications received during the SCDP phase are treated as being part of the new
source. The applications are not considered a modified source under the
provisions of Section C.1 (i.e., there is no evaluation needed for what the
"project" is).
Q: Please clarify how the dual source definition would apply when the
project itself triggers offsets and the applicant also proposes to create
on-site reductions.
A: As clarified in the staff report, if the project itself triggers offsets
then offsets are required and netting is not allowed (this only applies to NAR
review). Any decrease proposed by the applicant must be processed as an ERC
through the Source Register. This applies to all scenarios - including one where
the decrease is proposed to eliminate existing NEI (P1) only.
Q: Would the APCD require a source with pre-rule-adoption NEI greater
than the threshold to offset its NEI even when it applies for an emission
decrease?
A: With the new lower offset trigger there may be sources that already have
pre-existing NEI's greater than the threshold that have never been mitigated
through offsets. Any source in this situation will be required to offset the
entire NEI at their next modification. However, sources are not required to
offset their NEI if they apply for a modification that results in a decrease in
emissions.
Q: If a source triggers offsets, does it have to offset just the
amount of the net emission increase above 10 tons per year, or the full net
emission increase?
A: The source must offset the full net emission increase. However, a source
must only provide offsets for increases that have not already been offset. If
source with a 12 tpy NEI proposes a project that would result in an additional 2
tpy NEI, the source must offset all NEI that has not already been offset. Thus
if a
source has already offset the 12 tpy NEI, they must now offset the
additional 2 tpy.
For more information or assistance, call the Engineering Division at (805)
961-8800, or e-mail us at
engr@sbcapcd.org.
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