California Air Resources Board March 28 and April 3, 2006

1. Workshop to Discuss Amendments to Accommodate Stationary Diesel Engines in the AB 2588 “Hot Spots” Regulation California Air Resources Board March 28 and April 3, 2006

2. Workshop Objectives • Discuss proposed amendments to the AB 2588 Air Toxics “Hot Spots” Emissions Inventory Criteria and Guidelines Regulation • Describe why changes are being proposed • Provide examples of how the process could work for diesel engine operators

3. Presentation Outline • Overview of AB 2588 “Hot Spots” Program • Proposed Amendments • Stationary Diesel Engine ATCM and “Hot Spots” • Timeline and Facility Scenarios • Next Steps

4. Overview of “Hot Spots” Program

5. Regulatory History • AB 2588 passed by the State Legislature in 1987 (Connelly) requiring ARB to adopt “Hot Spots” Guidelines Regulation in 1989 • First facilities began reporting in 1991 • Guidelines Regulation amended in 1990, 1991, 1994, and 1997 to streamline reporting requirements, and require risk reduction • Program administered over last 15 years by Cal/EPA and local air districts

6. ARB and OEHHA Responsibilities • Office of Environmental Health Hazard Assessment (OEHHA) adopts new health values and health risk assessment guidelines • ARB adopts amendments to the regulation to reflect new health values and program needs • ARB and OEHHA provide tools and assistance to facilities and districts for conducting and evaluating risk assessments • ARB provides the public with information about facilities subject to the “Hot Spots” program

7. District Responsibilities • Notify facilities that they may be subject to this program • Review emissions inventory and require risk assessments when necessary • Ensure that significant risk facilities conduct public notification, and reduce emissions and risk when necessary • Send emissions data to ARB

8. Facility Responsibilities • Facility submits inventory to district if it meets at least one of the following: • emits >10 tons/yr of any criteria pollutant • belongs to class of small facilities that emit toxics • operates diesel engines (>3,000 gal/yr) • Facility conducts a health risk assessment • Significant risk facilities must conduct public notification • Facility reduces risk within 5 years if risk exceeds district threshold

9. Proposed Amendments to the “Hot Spots” Regulation

10. Why Do We Need to Amend the “Hot Spots” Regulation? • Last update of “Hot Spots” Emission Inventory Criteria and Guideline Regulation in 1997 • OEHHA HRA guidelines released 1999-2003 • State law requires incorporation of most recent OEHHA HRA Guidelines and health values • New risk assessment tools and electronic reporting formats

11. What Amendments are Being Proposed for “Hot Spots”? • Reduce threshold (currently 3,000 gallons of diesel fuel/yr) for facilities with diesel engines to account for updated diesel PM health values • Incorporate OEHHA Risk Assessment Guidelines by reference • Streamline inventory and risk assessment requirements for diesel engine facilities • Use stationary diesel engine ATCM information to determine “Hot Spots” applicability

12. Other Changes • Additional substances required to be reported • Prop 65 substances identified by OEHHA • Polybrominated diphenyl ethers • Adjustments to reporting formats • Use of electronic spreadsheets instead of paper forms • Ability to use HARP software to do health risk assessments and submit emissions data

13. Coordination of Stationary Diesel ATCM and “Hot Spots” Requirements

14. Comparison of ATCM and “Hot Spots” Requirements • “Hot Spots” • Risk-based • No emissions limits unless facility poses significant risk to nearby receptors • Public notification and risk reductions can be required if district determines that risk is significant • Substances and facilities added over time • Stationary Diesel Engine ATCM • Emissions-based • Hour limits and emission reductions required • Implementation began in 2005 with full implementation by 2011

15. Comparison of ATCM and “Hot Spots” Requirements (cont’d.) • ATCM addresses emissions from a single engine • “Hot Spots” addresses risk from entire facility • Multiple engines may individually comply with ATCM, but facility risk may still be significant • Facility with a prime engine should calculate residual risk before purchasing control equipment to determine if minimum ATCM requirements also fulfill “Hot Spots” requirements

16. How Are the Two Programs Being Harmonized? • The ATCM emission inventory may be used to comply with “Hot Spots” plan and report requirements • Threshold of 20 hrs/yr for both programs • Efforts made to eliminate duplicative requirements • “Hot Spots” risk assessments can reflect emissions after ATCM emission reductions are well underway

17. What Special Provisions Are Being Proposed for Stationary Diesel Engines? • ATCM emission inventory can be used for “Hot Spots” initial compliance • Screening risk assessment tables provided for initial risk evaluation • Lower State fees

18. Which Diesel-Fueled Operations Are Currently Subject to “Hot Spots”? • Regular maintenance and testing of emergency standby engines • Prime diesel engines • Routine use of portable equipment at a facility • Other diesel sources • Not Included: • Motor vehicle emissions • Use of engines during an actual emergency • Non-routine air district compliance testing

19. How Will Facilities Be Affected? • Most facilities with a single backup engine will fulfill “Hot Spots” requirements by complying with ATCM • Facilities with multiple engines will have to conduct varying levels of health risk assessments unless they are remotely located • A small number of facilities will have to conduct public notification to fulfill “Hot Spots” requirements • A small number of facilities will need to go beyond the ATCM to meet “Hot Spots” risk reduction requirements

20. How Will “Hot Spots” State Fees Be Assessed? • Most facilities with only diesel engines will be exempt from “Hot Spots” State fees • Facilities with only diesel engines with a risk >1 per million will pay State fees beginning in FY 08-09 (based on 2007 emissions) • Annual State fee likely to be $0 or $35 for facilities with only diesel engines • Facilities with other sources will be assessed fees ranging from $67 to $6,363 depending on their risk

21. Timeline and Facility Scenarios

22. Implementation Schedule for All Facilities • Board Hearing scheduled for July 2006 • California Office of Administrative Law (OAL) approves regulation in late 2006 • District notifies facilities that they are subject to “Hot Spots” • District uses ATCM inventory for “Hot Spots” • Facility submits 2007 (or earlier) emission inventory to district upon request

23. Implementation Schedule for Significant Risk Facilities With Only Engines • Facility conducts health risk assessment within 5 months of request by district • Facility conducts public notification when the risk assessment is approved by the district (most likely in late 2008) • If risk exceeds district risk threshold, facility must reduce risk within 5 years • In many cases, risk reduction requirement may be achieved through implementation of ATCM

24. Scenario #1 – An office building with asingle emergency backup diesel engine • Engine hours for maintenance and testing reduced below 20 hrs/yr by 2006 to comply with ATCM • Facility is exempt from “Hot Spots” (unless other toxics are located at the facility) • Facility pays $0 to ARB, but may pay a district fee

25. Scenario #2 – A School with 3 emergency backup diesel engines • Engine hours reduced below 20 hrs/yr for each backup engine • Facility submits ATCM engine data to district • District determines potential risk is significant using screening risk assessment tables • Facility uses HARP software to calculate a risk of 5 per million • Facility pays State fee of $35/yr, in addition to their district permit fee, and complies with “Hot Spots”

26. Scenario #3 – A Utility with 1 prime engine and 2 emergency backup engines • Facility reduces emissions from prime engine by 85%, and operates each backup engine <20 hrs/yr • Current risk from prime engine - 45 per million • Residual risk from prime engine - 5 per million • Risk from backup engines – 2 per million • Total facility risk in 2007 is 7 per million • Facility pays annual State fee in FY 08-09 of $100/yr, in addition to their district fee • Facility complies with “Hot Spots”

27. Scenario #4 – Facility with diesel engines already in “Hot Spots” program • Facility reduces engine hours to max extent possible • District determines potential risk is significant • Facility updates existing health risk assessment using HARP software – risk is 27 per million • Facility conducts public notification • Facility must replace dirtiest engines within 5-10 years to get their overall risk below district level of significance • Facility pays State fee of $3,300/yr until risk is <10 per million, then $100/yr until risk is <1 per million

28. Next Steps • Revise proposal based on workshop comments • Additional workshops may be held • Staff report available in June 2006 • Board meeting tentatively set for July 2006

29. Contact Information • Dale Shimp, Manager • Environmental Justice Section • 916-324-7156 dshimp@arb.ca.gov • Chris Halm • Environmental Justice Section • 916-323-4865 chalm@arb.ca.gov • http://www.arb.ca.gov/ab2588/ab2588.htm • Proposal available via the web http://www.arb.ca.gov/ab2588/2588guid.htm