Energy and Environment MonitorOn January 13, 2009, the U.S. EPA issued the final rule authorizing the use of “flexible air permits”, known as “FAPs” for both Clean Air Act Title V Permits and encouraging their use in New Source Review (NSR) permitting, i.e. Prevention of Significant Deterioration in attainment areas and Nonattainment NSR in non-attainment areas and “minor” NSR programs, which apply to new and modified sources that do not meet the emissions thresholds for the NSR programs that apply to major sources.
FAPs for CAA Title V Operating Permits Program:
In the context of a Title V permit, the FAP enables permitted major source to obtain approval for described categories of changes up front without subsequent review of the changes when they occur. (Major sources emitting 100 tons per year (TPY) or more of any regulated air pollutant or 10 TPY or more of any individual hazardous air pollutant or 25 TPY or more of combined hazardous air pollutants.) In order to utilize a FAP in a Title V permit, the permittee must request the FAP and be able to identify, and the permitting authority be able to authorize, the anticipated changes relevant to all applicable requirements. Any approved FAP would authorize a source to make certain changes described in the permit without further review from the state, local or tribal permitting authority. The source must continue to meet all Clean Air Act requirements that apply, such a national emissions standards for hazardous air pollutants and/or new source performance standards.
Available FAP approaches include the use of alternative operating scenarios (AOSs) and approved replicable methodologies (ARMs). An AOS authorizes a source to make changes to the operations of existing emissions units without requiring a Title V permit revision at the time the changes are made. The AOS identifies the applicable requirements associated with the alternative scenario and assures ongoing compliance. An AOS is the same provision found at 40 CFR 70.6(a)(9), which generally provides that any Title V Permit must include terms and conditions for reasonably anticipated operating scenarios identified in its application by the source and as approved by the permitting authority. Over the years, EPA has proposed rulemaking or guidance to address operational flexibility, but has not finalized any. The new rule
•Adds a definition of AOS, but eliminating the reference to “physical and operational changes” from the proposed definition.
§70.2 Definitions. . . . Alternative operating scenario (AOS) means a scenario authorized in a part 70 permit that involves a change at the part 70 source for a particular emissions unit, and that either results in the unit being subject to one or more applicable requirements which differ from those applicable to the emissions unit prior to implementation of the change or renders inapplicable one or more requirements previously applicable to the emissions unit prior to implementation of the change.
• The permittee must supplement its application with additional information when necessary to define permit terms and conditions to implement a permittee’s proposed AOS including a compliance plan
• The permittee’s AOS application must contain documentation that the source has obtained all authorizations required under the applicable requirements relevant to a proposed AOS or a certification the source has submitted all relevant materials for obtaining such authorizations.
• Where rules refer to AOSs consistent terminology shall be used.
An Approved Replicable Methodology (ARM) is a replicable protocol placed in a Title V permit to facilitate compliance with an applicable requirement in situations that otherwise could require a permit revision. Sometimes, circumstances change for a source that bring about the need to recalculate or update a value used either in determining the compliance status of the source with an applicable requirement or in determining the applicability of a requirement. For example, an ARM could specify a replicable testing procedure for updating an emissions factor, rather than requiring a permit revision to accomplish its update. To be approvable, an ARM must be based on sound scientific/mathematical principles and deliver replicable results (usually numerical) when operating on the same input data. EPA believed that ARMs have been generally available without any rulemaking (depending on the structure and content of individual part 70 programs, as approved for states), but added the regulatory changes to 40 CFR parts 70 and 71 in order to promote greater certainty and use of ARMs, where the permitting authority decides it is appropriate to do so. The new definition of ARM is:
Approved replicable methodology (ARM) means part 71 permit terms that:
(1)Specify a protocol which is consistent with and implements an applicable requirement, or requirement of this part, such that the protocol is based on sound scientific and/or mathematical principles and provides reproducible results using the same inputs; and
(2)Require the results of that protocol to be recorded and used for assuring compliance with such applicable requirement, any other applicable requirement implicated by implementation of the ARM, or requirement of this part, including where an ARM is used for determining applicability of a specific requirement to a particular change.
EPA does not expect that these clarifications to the existing title V regulations will necessitate revisions to many approved state operating permit programs. Revisions, if needed, would consist of adding definitions for AOS and ARM and codifying certain current policy.
New Source Review: PSD/ Nonattainment NSR / Minor NSR:
In the final rule, based on comments received, EPA determined not to finalize any of its proposed changes to the NSR program in parts 51 and 52 nor in the regulations for minor NSR .Comments received on EPA’s proposed rule which did propose changes to the programs including providing for “Green Groups”, affirmed that states, in general, have sufficient existing authority to advance approve minor NSR, where they determine it appropriate to do so, and to incorporate the permit terms accomplishing this approval into Title V permits as applicable requirements.
The “Green Group” proposal applicable for major source NSR, would have treated a number of emissions activities as a single emissions unit (termed, a “Green Group”) where the emissions from each of these activities would be routed to a common emissions control device meeting BACT/LAER, and future emissions increases and other changes within the Green Group would be approved for a 10-year period in a major NSR permit, as an extension of EPA’s December 2002 NSR reform regulations (67 FR 80186, December 31, 2002). Legal rationale for Green Groups was premised on the concept that the changes and emissions activities within a Green Group are specifically authorized to occur as a result of undergoing, not avoiding, major NSR. Although largely supported by industry commenters, opposition by State and environmental interest groups led EPA to withdraw the “Green Group” proposal while noting that EPA might re-initiate the proposal if supported by evidence from “pilot projects”.
The principal FAP approach used in minor NSR programs is advance approvals. In one permitting action, advance approvals authorize sources to undertake multiple planned individual changes or described categories of changes within a specified time period. In the absence of advance approvals, such planned changes would have to be individually reviewed and approved by the permitting authority at the time the changes are made. Advance approvals contained in minor NSR permits can then be incorporated into the source’s operating permit as applicable requirements. State minor NSR requirements, where applicable, are among the most important in designing a FAP for sources making frequent and/or rapid physical and operational changes. Absent an up-front authorization for these changes under minor NSR (usually categories or types of changes), an individual review by the permitting authority typically is required at the time each change would be approved.
In its final rule, EPA describes successful approaches used in state pilot projects to authorize “advance approved” changes in minor NSR programs which are typically used in conjunction with plantwide emissions caps, such as Plantwide Applicability Limits (PAL) and Potential-to-Emit (PTE) limits, to prevent major NSR from being triggered by physical or operational changes made under the advance approval for minor NSR. EPA determined that many states already have sufficient authority to issue advanced approvals under minor NSR programs, as appropriate.
Although no states would need to revise their minor or major NSR programs in order to implement the flexibility approaches described in the final flexible air permitting rule, EPA intends to support states where they choose to revise their minor or major NSR regulations to provide more explicit authority for FAPs.
This article was authored by Barbara D. Little, Jackson Kelly PLLC. For more information on the author see here.
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