Non-Attainment NSR Program

1. Non-Attainment NSR Program Presenter - TBD U.S. Environmental Protection Agency Office of Air Quality Planning and Standards Draft August 2013

2. Major Topics • Applicability • NA NSR Program Requirements • Lowest Achievable Emissions Rate (LAER) • Offsets • Statewide Compliance Certification • Alternatives Analysis

3. What is Non-Attainment NSR? Pre-construction review program required for New Major Sources or Major Modifications at existing Major Sources locating in areas designated as not attaining a National Ambient Air Quality Standard (NAAQS)

4. Non-Attainment NSR Applicability Like PSD, follow the 4 steps to determine whether new construction or modification project is subject to non-attainment NSR. Unlike PSD, however, review is only for the non-attainment pollutant. Being major for PSD does not trigger non-attainment NSR review.

5. Major Source Thresholds – NA Areas

6. Major Modification Thresholds

7. Applicability – Example 1 • New Age Widgets wants to construct a new widget making plant in a PM10 non-attainment area. • Widget making is not one of the 28 source categories. • Source’s potential to emit is shown on the table below. • Is this source subject to PSD or Non-attainment NSR? • If so, for which pollutants?

8. Applicability – Example 1 Solution – New Age Widgets

9. Applicability – Example 2 • Old World Skidgets wants to construct a new skidget making plant in a PM10 non-attainment area. • Skidget making is not one of the 28-source categories • Old World Skidgets potential to emit is shown below • Is Old World Skidgets subject to PSD, Nonattainment NSR, or both? • If so, for which pollutants?

10. Applicability – Example 2 Solution – Old World Skidgets

11. Non-Attainment NSR Requirements • Program has four basic requirements: • Lowest Achievable Emissions Rate (LAER) • Offsets • Statewide Compliance Certification • Alternatives Analysis

12. LAER • Lowest Achievable Emissions Rate (LAER) • The most stringent emission limitation contained in the state implementation plan of any State for such class or category or source; or • The most stringent emissions limitation achieved in practice by such class or category of source • May be in a permit or regulation • Does not consider: economic, energy, environmental or other factors

13. Offsets • Sources must provide emissions reductions that demonstrate the following: • Must offset the emissions increase from the new source or modification • Provide a net air quality benefit • Offset criteria • Surplus • Quantifiable • Permanent • Enforceable

14. Offset Criteria • Surplus • Must be actual emissions reductions (real). • Must be reductions that are not already required by an air quality plan, a compliance document, a permit, or have been used elsewhere. • Quantifiable • Must be able to quantify the emissions. If not quantifiable, then they can not be used to mitigate emissions increases.

15. Offset Criteria • Permanent • The reductions have to be permanent. If they can be emitted again, then they are not permanent. • Enforceable • The manner in which the offsets are created must be enforceable as a practical matter and legally enforceable.

16. Creating Offsets • An existing source wants to create emissions reductions that are eligible for offsets. What are the steps? • Determine baseline actual emissions • Determine new potential to emit • Subtract new PTE from baseline actual emissions • Check if any of those reductions were required by a federal requirement such as an approved rule, enforcement action, or another permitting action. If some or part of the reduction was used for another purpose, subtract that from previous result. • Net result is final adjusted emissions reduction available to use as offset.

17. Creating Offsets • An existing source wants to create emissions reductions that are eligible for offsets. What are the steps? • Determine baseline actual emissions • Determine new potential to emit • Subtract new PTE from baseline actual emissions • Check if any of those reductions were required by a federal requirement such as an approved rule, enforcement action, or another permitting action. If some or part of the reduction was used for another purpose, subtract that from previous result. • Net result is final adjusted emissions reduction available to use as offset.

18. Baseline actual emission for offsets Average actual emissions in TPY of the last 24 month period prior to actual reduction. Another 2 year period within the last five may be chosen if justified.

19. Statewide Compliance Certification The source must certify to the permitting authority that all sources owned or operated within that state are in compliance or an a schedule of compliance. If the applicant is unable to certify compliance, then source may be unable to obtain a permit.

20. Alternatives Analysis • Source must submit an analysis of alternative: • Sites • Sizes • Production processes • Environmental control techniques • The source must consider multiple locations and demonstrate that the chosen location is best for the project considering its impacts

21. Using the Alternatives Analysis to Raise Potential “Costs” to the Tribe • Section 173(a)(5) of the CAA requires the permitting authority to determine whether “an analysis of alternative sites, sizes, production processes, and environmental control techniques … demonstrates that benefits of the proposed source significantly outweigh the environmental and social costs imposed as a result of its location, construction, or modification. • What kinds of environmental and social costs could tribes suggest for consideration?

22. Summary • NA NSR rules apply to major sources located in non-attainment areas • Applicability is based on a source’s emissions of the pollutant for which the area is in nonattainment • Major sources must achieve LAER (Lowest Achieveable Emission Rate), which is more restrictive than BACT • Major sources must get offsets and demonstrate that the benefits of the source outweigh the costs