NEW SOURCE REVIEW

A Perspective from the Forest Products Sector

September 2003

Tammy R. WylesDirector, Environmental Affairs

Scope of Coverage

200+ manufacturing facilities in 30+ states Tissue and toweling, paper, and pulp Lumber, plywood, oriented strandboard (OSB),

particleboard, etc. Chemicals (primarily formaldehyde and resins) Gypsum wallboard In the west – numerous chemical manufacturing

facilities, a few wood products facilities, larger mills in Oregon (Toledo, Wauna, Halsey) and Washington (Bellingham and Camas)

NSR Evaluations

Joint technical/legal team at corporate HQ- consistency in the face of inconsistency- drafting of determination requests

Training to reinforce early involvement and evaluation of projects

Heavily involved in recent rulemaking- technical leader for AF&PA workgroup- provided examples and suggestions

The Nature of the Beast

Many projects have incremental gain in production; many are just quality of efficiency

Change at one point in process will typically impact other areas of the facility (e.g., increase in paper machine production will require additional pulp, steam, etc.)

Actual-to-potential accounting has typically been a mill-wide exercise and calculations may be repeated several times a year, leading to double counting

No consideration of project impact

Raw MaterialHandling

Pulp Production

Chemical Recoveryand Causticizing

Powerhouse

Roadways

Machine

Converting andFinishing

Environmentally Beneficial Projects

Installation of $4 MM storage building for the control of fugitive emissions, leading to dryer raw materials and increased throughput

Installation of overfire air system for increased efficiency, reducing both fuel costs and emissions

Replacement of boiler pre-heater with economizer, leading to a decrease in emissions

Replacement of a fuel oil burner with a burner that can burn a combination of natural gas and fuel oil

NSR Reform Perspective

Applicability accounting- will focus on the impact of the project- decisions on future projections may be difficult- recordkeeping requirements- eliminating recordkeeping when there is no causation

component will be important to success PCP exclusion

- has been helpful in past- elimination of “primary purpose” test is an

improvement

NSR Reform Perspective (continued)

PALs- have had experience with these in Oregon and that

system has worked well- not a point of focus for our industry in the recent

rulemaking- may still be useful – time will tell

Clean unit exclusion- may be helpful- application on pollutant-by-pollutant basis makes

sense, but will likely limit use

RMRR Rulemaking

Tube replacements and dryer hoods are probably the most common maintenance projects

Certainty, more than anything, will be the biggest help

Have been using the criteria from the 2000 Detroit Edison case, which still leads to case-by-case calls by industry

Will still need to work through definitions (e.g., “identical and serve the same purpose”, “does not alter the basic design parameters”, etc.)

The Bottom Line

Probably is not a perfect solution Has the concept of an NSR program become

obsolete or will that happen in the future? Are the multi-pollutant approaches the better

solution?