New Source Review (NSR) Program

An overview

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Paul WentworthEPA Region 3 , 3AP10215-814-2183March 28, 2012

New Source Review (NSR) Program

It is a pre-construction permitting program required under the Federal Clean Air Act that applies to:◦ New major stationary sources;◦ Existing major stationary sources making

modifications; and◦ Existing minor stationary sources making a

modification that equals or exceeds the major stationary source threshold.

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NSR is Actually Two Separate Programs

Nonattainment NSR (NNSR) is required for nonattainment pollutants in areas designated nonattainment.

PSD is required for attainment pollutants in areas designated attainment or classifiable, and all other pollutants regulated under the act.

Some pollutants have a foot in both programs at the same time.

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PSD

CO PM10

OthersGHG

Lead

Areas Nonattainment for PM2.5 and Ozone/Ozone Transport Region

NSR

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PM2.5 NOx/VOCs NO2

SO2

PSD

COPM10 VOCs

OthersGHG

Lead

Areas Nonattainment for PM2.5 (not in ozone transport area)

NSR

PM2.5 NOx/ NO2 SO2

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NSR

Ozone Non Attainment Areas/ Ozone Transport Region

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PSD

CO PM 10

OthersGHG

Lead PM2.5

VOC NOx NO2

NSR: Pre-reform vs. Post-Reform What’s the Difference ?

Pre-Reform (1980 Rule) Post-Reform (2002 Rule)

PSD & NNSR- PlantwideDefinition of Source

Baseline Actual Emissions

Emissions Increase: 1) Actual-to-PTE; or 2) Actual-to-Projected Actual Test

Plantwide Actual Limits(PALS)

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PSD- Plantwide source definition NNSR- Dual Source definition

Actual Emissions

Emissions Increase: Actual-to-PTE Test

Major Stationary Source - PSD Based on potential to emit of the source using

the plant-wide definition of source for any pollutant subject to regulation under the CAA.

Major Source Thresholds◦ 100/250 TPY depending on whether facility is

one of 28 listed source categories ◦ 28 listed sources must include fugitive

emissions in major source calculation

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Major Stationary Source - NNSR Based on potential to emit (PTE) of the source

for the nonattainment pollutants in the area for which it is nonattainment.

Source Definition can be plantwide or “Dual Source.”

From this point forward we will be referring to the plantwide definition in our discussion.

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Major Stationary Source- NNSR Ozone (regulated by its precursors)◦ Major source threshold driven by an area’s

classification – but not really. ◦ NOx and VOCs are regulated as precursors to

ozone.

PM2.5 (regulated as direct and precursors)◦ Major source threshold is 100 tpy for direct

PM2.5 emissions, SO2 and NOx as precursors.◦ After January 1, 2011, PM2.5 emissions must

include filterable and condensable emissions.

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Major Stationary Source-IMPORTANT For PSD:◦ “Major for one, major for all”

For NNSR:◦ Unlike PSD, a project must be major for each

non-attainment pollutant, including precursors, in order to be subject to NNSR.

◦ Yes, this has a somewhat absurd result.

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“Major for One, Major for All” Example

A facility with a PTE of 300 TPY for SO2 emissions and a PTE of 20 TPY for PM2.5 is making a change which will increase emissions of PM2.5 by 10 TPY.◦ In PSD: the 10 tpy increase in PM2.5 will

trigger PSD requirements. ◦ In NNSR: the facility is not major for PM 2.5

so the 10 TPY increase will not trigger NNSR requirements for PM2.5.

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Major Stationary Source

Based on potential to emit. A “source” includes all pollutant emitting

activities that:◦ belong to the same primary two digit

SIC code, ◦ are located on one or more contiguous

or adjacent properties, and◦ are under common control.

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Defining a “source” can be an issue:

Combined heat and power projects Landfill gas to energy projects Sell-off of stand alone processes to other

parties (getting more common) Aggregation of units joined by dedicated

pipelines, conveyor belts, etc but separated by distance (e.g. shale gas development)

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Same Primary SIC Code?

Are they owned by the same company?

Are they next to each other?

Is there a support facility relationship? The support question is only relevant to SIC code.

Is there a dedicated relationship and/or dependency? Commonsense notion of plant?

If not the same company, examine other factors such as contracts, interdependence

no

no

no

Defining a Source: What You Should Ask

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Potential to Emit (PTE)

The maximum capacity of a stationary source to emit a pollutant under its physical and operational design.

Any physical or operational limitation on the capacity of the source to emit a pollutant (including air pollution control equipment, and restrictions on hours of operation or the type or amount of fuel combusted, stored or processed) shall be treated as part of its design if the limitation or the effect it would have on emissions is federally enforceable.

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More on PTE To be a legitimate restriction on PTE, a limit

must be practically enforceable.◦ Source must be able to show continual

compliance◦ Have adequate testing, monitoring and

recordkeeping.◦ PTE limits may be in the form of emission

limits, capacity restrictions, restrictions on hours of operation.◦ Be careful! Emissions caps are often

unenforceable as a practical matter for NSR purposes!!!

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Practically Enforceable PTE Limits Emission Limits◦ Can’t use emissions limits alone, unless CEMs are used.◦ Otherwise, emission limits must include production

and/or operational limitations.◦ Averaging time periods must be short (monthly) or rolling

(annual rolled monthly), NO calendar year basis.

Monitoring◦ Limits are not practically enforceable without adequate

monitoring. CEMS, PEMS, periodic source testing, mass balance calculations,

engineering calculations, emission factors.

Recordkeeping and reporting must be included.

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“Project” – An Important Concept

“Project”: a physical change in, or change in the method of operation of, an existing major stationary source.

A project can be:◦ a future change, or◦ a change that occurred in the past but within the

contemporaneous time period.

When and how to calculate emissions increases and decreases for a given project depends on the types of units affected by the change and when the change occurred.

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“Project” – An Important Concept

A project is made up of emissions units (EU): ◦ New EUs◦ Modified EUs◦ Debottlenecked/Affected EUs◦ Replacement EUs

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Types of Emissions Units

Types of emissions units specifically defined by regulation:◦ New EU – Newly constructed and existed for

less than two years (Pitfall: Does not mean operated for 2 years).◦ Existing EU – A unit not defined as “new,”

includes “replacement units.”

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EUs not Defined by Regulation

Debottlenecked/Affected Unit◦ EU is not modified but emissions increase as a

result of the project.◦ A bottleneck is when the capacity of a

process is limited by the capacity of upstream or downstream processes.◦ Increasing the production/throughput of the

limiting step increases the ability of other process to operate.

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Defining Project Scope Review and define the entire project (i.e.,

new/modified/debottlenecked equipment).◦ What project is being proposed?◦ What new equipment will be added?◦ What existing equipment will be

removed/changed?◦ Is the project part of past or future changes

(aggregation of projects)?◦ Will the operation or emissions from other EUs

be affected by the change (i.e., is an EU debottlenecked)?

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Example 1: Project

Roma Cement Co. Three existing kilns Proposed changes:◦ Install riser duct in preheater on Kiln 3 and increase

throughput on Kiln 3 by 3%.◦ Replace fuel handling equipment and indirect firing

system on Kiln 3.

Define the Project (Determine which units will be affected by the “Project”).

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Roma Cement Co.Process-Existing Configuration

Quarrying and crushing

Raw MaterialPrep

Kiln 1pyroprocessing

Kiln 2pyroprocessing

Kiln 3pyroprocessing

Cement

productionClinker Handling

& StorageFinish Mill 1

Fuel Handling

Fuel Handling

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Roma Cement Co.Process- Proposed Change

Quarrying and crushing

Raw MaterialPrep

Kiln 1pyroprocessing

Kiln 2pyroprocessing

Kiln 3pyroprocessing

Cement

productionClinker Handling

& StorageFinish Mill 1

Fuel Handling

Fuel Handling

New Fuel Handling

Riser duct Installation

3% Cap increase

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Operation Status Affected by Project Y/N

Quarry and crushing Existing

Raw material preparation Existing

Fuel Handling – Kilns 1 and 2 Existing

Fuel Handling – Kiln 3 New

Kiln 1 pyroprocessing Existing

Kiln 2 pyroprocessing Existing

Kiln 3 preheater (separate stack) Existing

Kiln 3 pyroprocessing Existing

Finish mill No. 1 Existing

Clinker handling and storage Existing

Cement production Existing

Y

Y

NY

N

Y

Y

Y

Y

Y

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N

Major Modifications• A major modification is any physical change

or change in the method of operation that increases emissions in significant amounts.

• Significant can mean:• The pollutant by pollutant significance levels

established by rule;• Any increase in a PSD regulated pollutant that

does not have a significance level established by rule; or

• Any emissions rate or net emissions increase that would construct within 10 km of a Class I area and have an impact greater than or equal to 1 ug/m3.

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Major modification

• Before you can continue, you MUST ask two questions for each project. Do not skip this step!• Will they have to pick up a wrench, screwdriver, saw, or

any other tool that will come into physical contact with an emissions unit?

• Are they proposing to do something that they are either not physically or legally able to do right now?

• If the answer to either of these questions is “yes”:• Is the physical or operational change specifically

exempted? (see next slide)• No? Then the facility must do an applicability

determination. No exceptions---not even for pollution controls, not even for “green” projects!

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Major Modifications-Exempt Changes Physical changes or changes in the method of operation

that do not cause a significant increase in emissions. Routine maintenance and repair. Use of alternative fuels or raw materials mandated by

statute. Use of alternative fuels authorized by permit or that

could have been accommodated by the source prior to 1975.

An increase in hours of operation or production rate unless otherwise restricted via regulation or permit.

A change in ownership. Installation, operation and/or reactivation of certain

clean coal technology projects.

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Example 2- Modification An electric utility operates 4 boilers of varying

ages. Operation of all existing boilers is not restricted by any operational or emission limits. They intend to shut down the oldest boiler and shift the load to the remaining boilers.

Is this a modification?

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Example 2- Modification- Answer

No. Change in method of operation, but there

are no restrictions on operation under current permit.

No physical modification.

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Applicability Determination 1st Step: Project-at-Hand◦ Emissions increases only from the project at hand.◦ Does the project cause a significant emissions

increase? ◦ No decreases are counted in this step

2nd Step: Netting◦ Considers emission decreases from the project, as

well as contemporaneous increases and decreases.◦ Is the net emissions increase significant?

NOTE: Emissions are calculated for each pollutant on a unit-by-unit basis.

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NSR Applicability

Increases

Decreases Contemporaneous Increases & Decreases

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NSR Applicability

STEP 1 STEP 2

Increases Decreases

Contemporaneous Increases & Decreases

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Applicability- Major Modification

IMPORTANT:• Unless it is an exempt change, the facility must

complete an applicability determination to determine if the modification is significant.

• For a facility that is a “minor” stationary source, • any modification whose emissions would constitute a

major stationary source by itself will be considered a major stationary source.

• Therefore, will be subject to a complete applicability determination.

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“Commence Construction”For a major new source or major modification

to have “commenced construction;” The owner or operator must have obtained

and continue to hold all necessary preconstruction approvals required, AND

The source must either:◦ begin a continuous program of actual on-site

construction, or◦ enter into a contractual obligation to undertake a

continuous program of actual on-site construction to be completed within a reasonable time.

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“Commence Construction” A break in construction of greater than 18 months or

failure to commence construction within 18 months of PSD permit issuance will generally INVALIDATE a source's PSD permit.

The 18 month period may be extended upon a satisfactory showing that an extension is justified.

For phased-construction projects; each phase must commence construction within 18 months of the projected and approved commencement date.

No major source shall begin actual construction without a permit.

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“Begin Actual Construction” Initiation of physical, on-site, construction activities on

an emissions unit:◦ Must be of a permanent nature;◦ Examples include building supports, foundations,

underground piping, etc◦ Would not include construction of support facilities

such as roadways, ancillary buildings, etc. This term is used to define the activities a facility may

engage in prior to obtaining a permit. Conversely, by default, it defines activities a facility may

not engage until a permit is issued.

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Thank You!