PROPOSED AMENDMENTS TO RULE 2.34, STATIONARY GAS TURBINES FINAL STAFF REPORT

Transcription

1 Yolo-Solano Air Quality Management District 1947 Galileo Court, Suite 103 Davis, CA (530) PROPOSED AMENDMENTS TO RULE 2.34, STATIONARY GAS TURBINES FINAL STAFF REPORT October 24, 2014 Prepared by: Kyle Rohlfing, Associate Air Quality Engineer Reviewed by: Frank DeMaris, Engineering Manager

2 Table of Contents Page I. EXECUTIVE SUMMARY... 1 A. BACKGROUND... 2 II. DISCUSSION OF PROPOSED RULE 2.34 REQUIREMENTS... 3 III. COMPARISON TO OTHER APPLICABLE REGULATIONS AND REQUIREMENTS... 5 IV. IMPACTS OF THE PROPOSED RULE V. ENVIRONMENTAL IMPACTS OF METHODS OF COMPLIANCE VI. REGULATORY FINDINGS VII. PUBLIC COMMENTS AND STAFF RESPONSES VIII. REFERENCES ATTACHMENT A ATTACHMENT B PROPOSED AMENDMENTS TO RULE 2.34, STATIONARY GAS TURBINES; STRIKE-OUT UNDERLINE VERSION NOTICE OF EXEMPTION FROM CEQA GUIDELINES ATTACHMENT C RESOLUTION NO ATTACHMENT D WRITTEN COMMENTS RECEIVED

3 I. EXECUTIVE SUMMARY On November 12, 2014, the Yolo-Solano Air Quality Management District (District) Board of Directors will consider the proposed amendments to Rule 2.34, Stationary Gas Turbines. The rule applies to all stationary gas turbines rated 0.3 megawatts (MW) and larger. The main revisions/requirements for Rule 2.34 will be: 1. Definitions have been stricken or added as appropriate. 2. References to efficiency have been removed from the rule as they are no longer required. 3. Limitations on emissions concentrations in short-term excursions have been added to the standards section of the rule. 4. Requirements for emissions control during start-up and shut-down periods have been added. 5. The compliance schedule section of the administrative requirements has been stricken as all new or currently permitted sources will be immediately subject to rule provisions. 6. The emission control plan section of the administrative requirements has been edited so that the section will also apply to proposed sources. There is currently one permitted source within the District that will be subject to this revised rule. The rule revision was prompted by the application for an Authority to Construct for a new combined cycle power plant which has since been canceled. The revised rule will apply to any future proposals for installation of simple cycle or combined cycle gas turbine power plants. The revisions of the rule acknowledge the practical considerations of operating a combined cycle gas turbine power plant. The deletion of the efficiency multipliers from the standards section of the rule will result in lower permissible limits for oxides of nitrogen (NOx). The District does not expect the proposed rule changes to have either a significant or a detrimental effect on the environment. Therefore, staff has prepared a Notice of Exemption (NOE) to satisfy the California Environmental Quality Act (CEQA) requirements. The NOE states that the adoption of these proposed rule amendments is exempt from the requirements of CEQA pursuant to Section 15308, Actions by Regulatory Agencies for Protection of the Environment. Page 1

4 A. BACKGROUND Overview of source category Stationary gas turbines are engines consuming liquid or gaseous fuels, which produce mechanical power that can be used to perform mechanical work or can be converted into electrical power. After air is compressed in the compressor section of the engine, fuel is introduced and mixed with the air and then the mixture is ignited in the combustor. The expanding combustion gases exhaust through the turbine section of the engine, causing the turbine blades to spin and thus creating shaft power. The combustion of fuel by the stationary gas turbine results in the emission of five of the District s criteria pollutants: carbon monoxide (CO), oxides of nitrogen (NOx), oxides of sulfur (SOx), volatile organic compounds (VOC), and particulate matter with an aerodynamic diameter equal to or less than ten microns (PM 10 ). Many stationary gas turbines utilize selective catalytic reduction (SCR) as an emissions control technology. This control technology results in the emission of ammonia, which can negatively affect the respiratory system with acute and chronic exposures. In the simple cycle gas turbine power plant electrical power is created from the generator driven by the gas turbine. A later development in stationary power generation is the combined cycle power plant which utilizes additional components. The more complex combined cycle extracts useful heat energy from the gas turbine exhaust with a heat recovery steam generator. The heat recovery steam generator then channels the steam to drive a steam turbine. The shaft power from the steam turbine is used to drive an additional electric generator. The additional equipment of the combined cycle power plant results in a greater amount of time necessary to reach steadystate operation compared to the simple cycle process. Currently, CalPeak Power - Vaca Dixon, LLC (CalPeak) is the only stationary gas turbine source subject to this rule operating in the District. This source consists of two simple cycle stationary gas turbines controlled with SCR. Because these are simple cycle turbines, the longer start-up period proposed for combined cycle units will not apply. Sources will be allowed temporary departures from emission limit compliance for periods of short-term excursions under the proposed rule revisions; however, the turbines will be limited to a more restrictive NOx emission concentration limit for periods of steady state operation. Results of recently performed source tests show compliance with the revised applicable NOx emission concentration limits can be achieved. Page 2

5 II. DISCUSSION OF PROPOSED RULE 2.34 REQUIREMENTS Listed below are descriptions of the proposed revisions to Rule 2.34, Stationary Gas Turbines. Section 100 General Section Purpose: The purpose of this rule is to limit NOx emission from stationary gas turbines. Section Applicability: Except as provided in sections 110 and 111, this rule shall apply to all stationary gas turbines, 0.3 megawatt (MW) and larger. Section 103 Severability: If any provision, clause, sentence, paragraph, section or part of this rule is for any reason judged to be unconstitutional or invalid, such judgment shall not affect or invalidate the remainder of the rule. Section Exemption - Laboratory, Firefighting/Flood Control, and Chemical Processing Units: Except for the notification requirement of section 401.3, the provisions of this rule will not apply to laboratory gas turbines used for research into the advancement of gas turbine technology, turbines used exclusively for firefighting and/or flood control, or chemical processing gas turbines. The revision of this rule will eliminate the exemption for pipeline gas turbines that could have been granted at the Air Pollution Control Officer s determination that emissions control technology is not technologically feasible, cost effective, or creates adverse environmental impacts. Section Exemption - Emergency Standby and Small Units: Except for the notification and record-keeping conditions of sections 401.3, 402, and 502.2, the provisions of this rule shall not apply to emergency standby stationary gas turbines operating less than 200 hours per calendar year, or units rated less than 4 MW operating less than 877 hours per calendar year. Section 200 Definitions: Twenty-one (21) terms have been defined for rule clarity. Section 300 Standards Section Emission Limits: Except for the start-up period, shut-down period, or up to four (4) consecutive fifteen minute periods during short-term excursions, the gas turbine shall not be operated under conditions with NOx emissions (averaged over 15 minutes) in excess of the limits specified in Table 1. In response to public comments on the compliance ability of gas turbines burning alternative gaseous fuels, such as landfill, digester, and refinery gases, the District is revising Table 1 to restrict the emission limits associated with gaseous fuels to commercial natural and liquefied petroleum gases. As no existing gas turbine subject to the rule is fired on any of these alternative gaseous fuels, this revision is not a relaxation of the emission limits. Any future gas turbine proposing to fire alternative gaseous fuels will be subject to the requirement to use the best available control technology (BACT) under the District s New Source Review rule, which will include a case-by-case emission limit appropriate for that unit and fuel. Page 3

6 TABLE 1. NOx Emission Concentration Limits Unit Size Compliance limit NO x, 15% O 2 Megawatt Rating (MW) Gas A Liquid B 0.3 to Less Than 2.9 MW and Units Greater Than or Equal to 4 MW That Operate Less Than 877 Hour/Year to Less Than 10 MW MW and Over 9 25 A. GAS INCLUDES ONLY COMMERCIAL NATURAL AND LIQUIFIED PETROLEUM GASES. B. LIQUID INCLUDES KEROSINE, JET, AND DISTILLATE OIL. THE SULFUR CONTENT OF THE OIL SHALL BE LESS THAN 0.05%. Section 301.1: This rule amendment limits the duration and NOx concentration of short-term excursions. Section 301.2: This rule amendment limits the total amount of time allowed for short-term excursions in a year. Section 302: This section has been added to require operation of emissions control devices during periods of turbine start-up and shut-down. This section will require operation of SCR systems once the temperature of the catalyst media has increased to the minimum operation temperature either specified by the manufacturer or as previously established in source tests for a specific source. The EPA requested the rule should specify a minimum temperature at which SCR control should be initiated and supplied a range of F. The District has agreed to set the minimum temperature for SCR control to the upper limit of this range. To determine a practical emission limit during start-up periods the District considered recent power plant projects reviewed by the California Energy Commission. Comparing maximum hourly emissions proposed during start-up periods to the rated heat inputs of the gas turbines the District determined that 0.16 lb NOx/MMBtu is an appropriate limit for turbine emissions during startup for turbines combusting gaseous fuels. The District determined that this emission rate is equivalent to a NOx concentration of 43 15% O 2 and proposed to make this limit enforceable as an average over the duration of the startup period. The District received public comments questioning the feasibility of the proposed startup limit for smaller gas turbines. These comments from a turbine manufacturer indicated that a higher limit of 70 ppmv should be an attainable standard. As the purpose of the startup limit is to avoid a perceived loophole in the rule s emission limits, the District has revised the proposed rule to include a startup limit of 70 ppmv NOx at 15% O 2. The District found less recent data available for emissions during startup from turbines combusting liquid fuel. To avoid setting an unrealistically low limit for startup emissions the District started with a NOx emissions factor of 0.88 lb NOx/MMbtu from the fifth edition of U.S. EPA AP-42, Compilation of Air Pollutant Emission Factors as a maximum value. This value was substituted in the equation to calculate the startup emissions exhaust concentration limit for liquid fueled turbines along with the F factor for crude, residual, and distillate oils at 9,190 scf/mmbtu. Page 4

7 0.88 lb MMBtu lb 385 scf 9,190 mole mole scf (20.9%-15%) = 226 ppm@15% O2 MMBtu (20.9%) Section 303: This section has been added to specifically require a stationary gas turbine owner/operator to install and operate continuous monitoring equipment. For units with ratings equal to or greater than 10 MW, the owner/operator will be required to install equipment that measures and records exhaust gas NOx concentrations. Section 304: This section has been added to require regular third-party testing of emissions from affected turbines to determine compliance with NOx emission concentration limits. For units with ratings equal to or greater than 10 MW, the owner/operator will also be required to conduct a regular Relative Accuracy Test Audit (RATA) to determine the reliability of measurements made by the continuous emissions monitoring system. Section 400 Administrative Requirements Section 401 Exemption Applicability: The owner/operator shall submit support documentation for any units exempt from the provisions of the rule per Sections 110 and 111 of the rule. Section Emergency Standby and Small Units: The owner or operator of an exempt emergency standby or small unit shall notify the APCO in writing within seven days if the hourper-year limit is exceeded. If the limit is exceeded the exemption shall be permanently withdrawn and within 30 days of the exceedance, an application for an Authority to Construct shall be submitted detailing a plan to meet the applicable limit of Section 301. This section shall not apply to public service units operating during a state of emergency declared by the Governor of the State of California. Section 500 Reporting and Recordkeeping Section Reporting: The owner or operator shall maintain records for a period of five years. The owner or operator shall also submit to the APCO information demonstrating that the CEMS has data gathering and retrieval capability. Prior to the issuance of a Permit to Operate, the owner or operator shall submit information correlating the control system operating parameters to the associated NOx output. Source test information shall be provided annually regarding the exhaust gas NOx concentration. Section Recordkeeping: Gas turbine operating logs shall be maintained that include, on a daily basis, the actual start-up and stop time and total hours of operation. The information shall be retained for a period of five years and shall be made available for inspection. Section Test Methods: Section 601: Oxides of Nitrogen (NOx) shall be determined in accordance with U.S. Environmental Protection Agency (EPA) Method 7E or EPA Method 20. Section 602: Oxygen (O2) shall be determined in accordance with California Air Resources Board (ARB) Method 100 or EPA Method 3A. Page 5

8 III. COMPARISON TO OTHER APPLICABLE REGULATIONS AND REQUIREMENTS California Health and Safety Code (CH&SC) Section requires districts to perform a comparative alternative analysis of any new control standard. Specifically, the District is required to prepare a written analysis that identifies all existing federal air pollution control requirements, including, but not limited to emission control standards constituting best available control technology (BACT) that applies to the same equipment or source type as the rule or regulation proposed for adoption or modification by the District. In addition, the analysis shall identify any other District rule or regulation that applies to the same equipment or source type. The analysis shall compare the following specific elements: A. New Source Performance Standards Stationary gas turbines with a 10 Million Btu per hour heat input rate at peak load (based on the higher heating value of the fuel fired) are subject to the requirements of the EPA s New Source Performance Standards (NSPS) contained in 40 CFR Part 60, Subpart KKKK. Table 2 below presents a comparative analysis between specific elements of the proposed revised rule and the corresponding elements of the existing federal regulation. Table 2. Comparison of Proposed Rule Revision Emission Limits with NSPS 40 CFR, Part 60, Subpart KKKK Turbine Rating District Rule 2.34 NOx Emission Limits, ppmv@15% O 2 Federal Regulation 40 CFR Part 60, Subpart KKKK NOx Emission Limits, ppmv@15% O 2 10 MW fired on Natural Gas 25 or 42 42, 100, or MW fired on fuel other than Natural Gas 25, 42, or or MW fired on Natural Gas 9 or 42* 15, 25, 42, 100, or MW fired on fuel other than Natural Gas 9, 25, 42, or 65* 42, 74, 96, 100, or 150 * The 42 and 65 ppmv NOx limits in these categories only apply to turbines which are limited to operating for less than 877 hours/year The standards for sulfur dioxide of 40 CFR Part 60, Subpart KKKK requires either that the emission of sulfur dioxide (SO 2 ) from any stationary gas turbine not exceed 0.90 pounds per megawatt-hour or that the fuel burned not contain potential sulfur emissions in excess of pounds of SO 2 per million BTU. The subpart also contains alternative compliance limits for turbines in a non-continental area or if the EPA administrator finds both that the turbine is located in an area where natural gas is not available and that the removal of sulfur compounds would cause more environmental harm than benefit. District Rule 2.34 currently does not contain any restrictions on sulfur oxides and the proposed amendments will not add any restrictions. Emissions of sulfur oxides from stationary gas turbines will be limited by other District rules and regulations as well as state-level regulations on fuel sulfur content. Page 6

9 Table 3. NOx Emission Monitoring Conditions District Rule 2.34 Federal Regulation 40 CFR Part 60, Subpart KKKK Requirement Application Requirement - Monitoring system which continuously monitors and records: a. Control system operating parameters; b. Elapsed time of operation; c. For units of 10 MW or greater, the exhaust gas NOx concentrations corrected to ISO conditions at 15 percent oxygen on a dry basis. The NOx monitoring system shall meet requirements of 40 CFR Part 60, Appendix B, Spec. 2 or other systems that are acceptable to the EPA. - Turbines with water or steam injection for NOx control - Continuous monitoring system for fuel consumption and ratio of water/steam to fuel OR - Continuous emissions monitoring system (CEMS) with NOx and O 2 (or CO 2 ) monitors and fuel and watt meters Also - For combined heat and power turbines equipped with CEMS monitoring, meters for useful recovered energy flow rate, temperature, and pressure Turbines without water or steam injection for NOx control - Annual performance test (may be reduced to once every 2 years if results show NOx emissions equal to or less than 75% of limit OR - Continuous emissions monitoring system (CEMS) with NOx and O2 (or CO2) monitors and fuel and watt meters OR - Continuous parameter monitoring (parameters to be monitored dependent upon turbine design and control equipment) Stationary gas turbines with a 10 Million Btu per hour heat input rate at peak load (based on the lower heating value of the fuel fired) and not regulated under Subpart KKKK are subject to the requirements of NSPS contained in 40 CFR Part 60, Subpart GG. Table 3 below presents a comparative analysis between specific elements of the proposed revised rule and the corresponding elements of the existing federal regulation. Page 7

10 Table 4. Comparison of Proposed Rule Revision Emission Limits with NSPS 40 CFR, Part 60, Subpart GG Turbine Rating District Rule 2.34 NOx Emission Limits, O 2 Federal Regulation 40 CFR Part 60, Subpart GG NOx Minimum Emission Limits, ppmv@15% O to Less Than 2.9 MW And Units Greater Than or Equal to 4 MW That Operate Less Than 877 Hour/Year 2.9 to Less Than 10.0 MW 42 or or or MW and Over 9 or or 150 The NOx emission limits presented for Subpart GG reflect the most stringent emission limits which can be increased to higher levels with an adjustment factor calculated from the manufacturer s rated heat rate at the manufacturer s rated peak load and a NOx emission allowance for fuel-bound nitrogen. The federal regulation requires that if a nonzero emission allowance for fuel-bound nitrogen is used in the calculation of the applicable NOx emission limit in Subpart GG, the owner or operator of the turbine shall monitor the nitrogen content of the fuel combusted by the approved methods. The standards for sulfur dioxide of 40 CFR Part 60, Subpart GG require that the emission of sulfur dioxide from any stationary gas turbine not exceed percent by volume at 15 percent excess oxygen on a dry basis. The regulation also requires the fuel fired in a stationary gas turbine shall not contain sulfur in excess of 0.8 percent by weight. District Rule 2.34 currently does not contain any restrictions on sulfur oxides and the proposed amendments will not add any restrictions. Emissions of sulfur oxides from stationary gas turbines will be limited by other District rules and regulations as well as state-level regulations on fuel sulfur content. Both 40 CFR Part 60, Subpart GG and District Rule 2.34 require monitoring of the emission unit to demonstrate compliance with the applicable emissions standards. The federal regulation requires monitoring of the total sulfur content of the fuel combusted in the turbine. This monitoring becomes elective if the owner or operator can demonstrate by approved means that the fuel being fired in the turbine meets the definition of natural gas given in the regulation. District Rule 2.34 has not contained, and the rule revision will not add, any limitations on sulfur dioxide emissions, so the District rule includes no requirement to monitor the fuel sulfur content. Page 8

11 Table 6. NOx Emission Monitoring Conditions District Rule 2.34 Federal Regulation 40 CFR Part 60, Subpart GG Requirement Application Requirement - Monitoring system which continuously monitors and records: a. Control system operating parameters; b. Elapsed time of operation; c. For units of 10 MW or greater, the exhaust gas NOx concentrations corrected to ISO conditions at 15 percent oxygen on a dry basis. The NOx monitoring system shall meet requirements of 40 CFR Part 60, Appendix B, Spec. 2 or other systems that are acceptable to the EPA - Turbines with water or steam injection for NOx control - Construction, reconstruction, or modification after Oct 3, 1977 but before July 8, Construction, reconstruction, or modification after Oct 3, 1977 but before July 8, 2004 without water or steam injection - Turbine constructed after July 8, 2004 with water or steam injection - Turbine constructed after July 8, 2004 without water or steam injection - Continuous monitoring system for fuel consumption and ratio of water/steam to fuel - May as alternative install continuous emissions monitoring system (CEMS) with NOx and O 2 (or CO 2 ) monitors - CEMS not requried - Either continuous monitoring of fuel consumption and ratio of water/steam injection or use of NOx CEMS - May elect to, but not required to, operate NOx CEMS - May elect to, but not required to, perform continuous parametric monitoring - Periodic testing is an another acceptable monitoring system - Parameters to be continuously monitored to show compliance with acceptable emission rates shall be monitored during the initial source test to establish acceptable values and ranges B. Reasonably Available Control Technology The revisions to this rule would establish for steady-state operation the same NOx emission limits as those currently established for stationary gas turbines by the Sacramento Metropolitan Air Quality Management District, which are equal to or lower than the applicable standards established by the federal government under 40 CFR 60 Subpart KKKK and well below the lowest applicable standards required by Subpart GG. Many determinations of Best Available Control Technology (BACT) made by other districts in California and by state agencies in other states of the country have shown that the application of various control technologies, including low-nox combustors and SCR, result in emissions well in compliance with the proposed rule revision. These determinations demonstrate that the proposed rule emission limits are achievable. The District showed the existing rule satisfies RACT in a 2006 RACT State Implementation Plan and the proposed revised rule will be as stringent in controlling emissions. The CalPeak peaking power plant in Vacaville complies with the rule to satisfy RACT. The Permit to Operate for CalPeak includes two limits on the emission concentration of NOx. This source is limited to emit NOx in no higher concentration than 3.0 ppmv corrected to 15% O2 on a 3 hour rolling average and 12 ppmv corrected to 15% O2 for 15 minute averages except for certain periods of operation when the source is exempt from one or both of these limits. This source has demonstrated ability Page 9

12 to operate in compliance with the lower emission limits of the proposed revision accepting that a source will be exempt from compliance with the rule emissions concentration standards during periods of shutdown and short-term excursions as defined in the rule and that separate limits have been established for periods of startup. C. Best Available Retrofit Control Technology The Sacramento Federal Non-Attainment Area is classified by the EPA to be in severe nonattainment of the 8-hour national ambient air quality standard for ozone. According to Section of the California Health and Safety Code, a district with severe air pollution shall, to the extent necessary to meet the requirement that a district design a plan to achieve and maintain air quality standards by the earliest practicable date, include in the district plan all measures required for moderate and serious nonattainment areas. One of the measures for districts with serious air pollution is the use of the Best Available Retrofit Control Technology (BARCT) for existing permitted stationary sources. The only existing stationary gas turbines subject to the rule are operated by CalPeak Power and have the potential to emit 0.06 tons per day of NOx. The Yolo-Solano Air Quality Management District has not relied on the application of BARCT for stationary gas turbines as a means to achieve ambient air quality standards in the 2012 Triennial Assessment and Plan Update. BARCT is not required and this rule does not establish BARCT. IV. IMPACTS OF THE PROPOSED RULE Emissions Impacts As previously stated, there is currently only one permitted source within the District that will be subject to the provisions of the revised rule. CalPeak has demonstrated ability to meet the NOx emission concentration standard of the revised rule. Although an exemption for short-term excursions will allow the NOx emission concentration to be exceeded for short periods of time, additions to the rule require that the average emissions for any six hour period containing a shortterm excursion comply with the NOx emission limitation, and short-term excursions will be limited to no more than ten hours per year. The limitations to the short-term excursions provision will ensure that NOx emissions will not increase as a result of the revisions to this rule. The longer start-up period for combined cycle stationary gas turbine power plants will not result in higher NOx emissions from a relaxation of regulation of such sources since the longer start-up period reflects the practical limitations of operating combined cycle power plants. The elimination of the thermal stabilization period emissions limits exemption has been replaced by exemptions for periods of start-up and shut-down; however, with the added requirement to operate control equipment during such periods and an added start-up limit the proposed revisions will not result in a relaxation of the emissions control from the existing version of the rule currently in the State Implementation Plan. Cost Effectiveness CH&SC Section requires the District, in the process of adopting any regulation, to consider and make public its findings related to the cost effectiveness of a control measure. Cost effectiveness for rulemaking purposes is calculated by dividing the cost of air pollution controls required by the rule by the amount of air pollution reduced. Since there are no reductions expected from the proposed amendments to this rule and no additional air pollution controls are expected, no cost effectiveness calculations are required. Page 10

13 Socioeconomic Impacts CH&SC Section (a) requires the District, in the process of adopting any rule or regulation, to consider the socioeconomic impact if air quality or emission limits may be significantly affected. However, districts with a population of less than 500,000 persons are exempt from the provisions of Section (a). The District s population is estimated to be approximately 331,600, well below the 500,000 person threshold. Therefore, a socioeconomic analysis for this rulemaking is not required. Incremental Cost Effectiveness CH&SC Section requires an assessment of the incremental cost-effectiveness for proposed regulations related to ozone, Carbon Monoxide (CO), Sulfur Oxides (SOx), Nitrogen Oxides (NOx), and their precursors. Incremental cost-effectiveness is defined as the difference in control costs divided by the difference in emission reductions between two potential control options that can achieve the same emission reduction goal of a regulation. Rule 2.34 only contains limitations on NOx emissions. Since the revised rule does not require any additional air pollution controls not already required by other District rules and regulations, no cost effectiveness calculations are required. Impacts to the District The currently operating source has already demonstrated emissions that will be in compliance with the applicable NOx emission limitation of the rule. Additional record-keeping will be required of sources to demonstrate compliance with rule provisions for periods of short-term excursions from NOx emission compliant operation. It is anticipated that the proposed rule will have little to no impact on staff workload at the District. It is expected that any additional work load can be absorbed within the District s engineering division. V. ENVIRONMENTAL IMPACTS OF METHODS OF COMPLIANCE California Public Resource Code Section requires the District to perform an environmental analysis of the reasonably foreseeable methods of compliance. The analysis must include the following information for the proposed amendments to Rule 2.34: 1. An analysis of the reasonably foreseeable environmental impacts of the methods of compliance. 2. An analysis of the reasonably foreseeable mitigation measures. 3. An analysis of the reasonably foreseeable alternative means of compliance with the rule or regulation. Table 1 lists all reasonably foreseeable compliance methods, the environmental impacts of those methods, and measures that could be used to mitigate the environmental impacts. Page 11

14 TABLE 7. Environmental Impacts, Mitigation Measures, and Alternatives Compliance Methods Water/Steam Injection, Low NOx Combustion, and Selective Catalytic Reduction Reasonably Foreseeable Environmental Impacts Air Quality Impacts: Reduced NOx emissions but potential for ammonia emissions from use of selective catalytic reduction Water Impacts: Potential for increased consumption of water for water/steam injection as emissions control Human Health Impacts: Improved human health in the District by reduction in emission of precursor to ground level ozone Solid Waste Disposal Impacts: Small increase in solid waste from SCR catalysts that cannot be reactivated or otherwise recycled Reasonably Foreseeable Mitigation Measures Installation of Continuous Emissions Monitoring System (CEMS) and regular source testing to ensure rule compliance and minimize ammonia emission This analysis demonstrates the adoption of amendments to Rule 2.34 will not have a significant effect on the environment or humans due to unusual circumstances. In addition, the proposed amendment of Rule 2.34 is an action taken to protect the environment. Therefore, staff has determined that the project is categorically exempt from the requirements of the California Environmental Quality Act (CEQA) pursuant to Section 15308, Actions by Regulatory Agencies for Protection of the Environment. Staff has prepared a Notice of Exemption (NOE) to meet the CEQA Guidelines (Attachment B) for submittal to the County Clerk for Yolo County, and the Clerk of the Board of Supervisors for Solano County. VI. REGULATORY FINDINGS Section 40727(a) of the CH&SC requires that prior to adopting or amending a rule or regulation, an air district s board makes findings of necessity, authority, clarity, consistency, nonduplication, and reference. The findings must be based on the following: 1. Information presented in the District s written analysis, prepared pursuant to CH&SC Section ; 2. Information contained in the rulemaking records pursuant to CH&SC Section 40728; and 3. Relevant information presented at the Board s hearing for adoption of the rule. The required findings are: Necessity: The rule amendment is required in order to limit emissions of NOx from stationary gas turbines while accepting the additional technical difficulties in achieving emissions compliance at Page 12

15 startup for combined cycle gas turbine power plants versus simple cycle power plants. (CH&SC Section 40727(b)(1)). Authority: The District is authorized to adopt rules and regulations by CH&SC, Sections 40001, 40702, 40716, and (CH&SC Section 40727(b)(2)) Clarity: District staff have reviewed the proposed rule and determined that it can be easily understood by the affected industry. In addition, the record contains no evidence that the persons directly affected by the rule cannot understand the rule. (CH&SC Section 40727(b)(3)). Consistency: The District has compared the proposed rule to federal New Source Performance Standards (40 CFR Part 60) Subparts GG and KKKK for stationary turbines as well as possible revisions to Subpart KKKK for which implementation is pending. The proposed rule does not conflict with, and is not contradictory to, existing statutes, court decisions, or state or federal regulations. (CH&SC Section 40727(b)(4)). Non-Duplication: The proposed rule does not duplicate any state laws or regulations regarding the attainment and maintenance of state and federal air quality limits. (CH&SC Section 40727(b)(5)). Reference: The District is not implementing, interpreting, or making specific any statute, court decision, or other provision of law by amending Rule (CH&SC Section 40727(b)(6)). VII. PUBLIC COMMENTS AND STAFF RESPONSES Staff held a public workshop on January 15, 2014, to discuss the proposed amendments to Rule Notification was sent to surrounding Air Districts, City Managers within the District, building/planning/community development departments within the District, all city and county libraries within the District, all Board members, and all permitted/proposed sources. The workshop notice was published in The Davis Enterprise, The Woodland Daily Democrat, and the Vacaville Reporter newspapers on January 8, A copy of the public workshop notice, the draft staff report, and draft rule language, was posted on the District s web page. A. Public Workshop - January 15, 2014 No comments pertaining to the proposed rule revisions were received during the public workshop or during the public comment period that ended on January 29, On February 6, 2014, the U.S. EPA submitted two comments pertaining to the rule. Comment 1. Response 1. Nicole Law of the U.S. EPA commented that the definition of short-term excursions in the draft rule language creates a less stringent exemption from NOx emission limit compliant operation than the exemption given in the Sacramento Metropolitan Air Quality Management District s Rule 413, and asked that the District consider further limiting the exemption for such excursions. The definition of short-term excursions was revised to state that such excursions are short term departures from compliant operation for turbines with a rated output greater than 100 MW, which are part of a combined cycle process, due to specified causes. Page 13

16 Comment 2. Response 2. Nicole Law of the U.S. EPA also commented that the rule needed to place emission limits on turbines during periods of start-up and shut-down, either with numerical emission limits or a requirement that control equipment be operational during periods of start-up and shut-down. As part of the comment she provided a link to an EPA proposed rule addressing start-up, shut-down, and malfunction provisions of rules included in State Implementation Plants (SIPs) at: The District notes that the proposed rule is a call for SIP revisions from certain specified regions not including any air district in California. EPA did not provide in the comment any suggestions for specific emission limits during periods of start-up and shut-down. Although this rule does not propose specific emission limits for stationary gas turbines during start-up and shut-down events, any unit subject to this rule will also be subject to the daily, quarterly, and annual emission limits of its Permit to Operate, including all startup/shutdown emissions. District permits include emission limits which are determined by the type of emission unit permitted, the proposed operation of the source, and the requirements of however many different District rules the source is subject to. No revision to the rule language is proposed. B. Additional Regulatory Notice After receiving written comments from U.S. EPA resulting from the notice performed prior to the public workshop, the District revised the proposed rule language. Before moving to a public hearing the District sent the revised rule language and updated staff report to U.S. EPA for another review period on March 6, On April 18, 2014 the U.S. EPA submitted additional written comments pertaining to the rule. Comment 1. Response 1. Comment 2. Response 2. Andrew Steckel of the U.S. EPA commented on the District s contention that even if the rule did not contain specific emission limits for period of start-up and shut-down, emissions units subject to the rule would still have permit limits which restrict emissions from such units on a daily, quarterly, and annual basis. Mr. Steckel stated that while such permit limits might fulfill Clean Air Act requirements they are not approved into the SIP. He suggested revising rule provisions to require controls during start-up and shut-down either with numerical emission limits or operational requirements. Proposed Rule 2.34 has been revised to add start-up/shut-down operating standards. This section requires Selective Catalytic Reduction control systems operate once the temperature of the catalyst media reaches the minimum temperature for operation recommended by the manufacturer or as demonstrated in source tests. The section also requires other emissions control devices to operate continuously during start-up and shut-down events. Mr. Steckel also recommended that the District demonstrate the revised rule fulfills Clean Air Act requirements regarding continuous emission limitations, RACT, and SIP relaxations. The District feels the addition of operational standards for periods of start-up and shut-down adequately addresses the requirement for continuous emission Page 14

17 limitations and the concern over SIP relaxations. The requirement for RACT has been previously addressed in this staff report. The District made further revisions to the proposed language and staff report and returned them to U.S. EPA for review on May 19, On June 4, 2014 the U.S. EPA submitted additional written comments pertaining to the rule. Comment 3. Response 3. Comment 4. Response 4. Andrew Steckel again commented on the proposed language for start-up/shutdown periods and suggested that some type of numerical limit should be established for emissions during start-up periods and for initiation of SCR emissions control. The District reviewed recent power plant projects reviewed by the California Energy Commission to develop a practical limit for start-up emissions. The District also accepted the upper limit of a range of temperature values supplied by EPA as the minimum temperature to activate SCR control. Mr. Steckel also asked for the staff report to explain how the replacement of a thermal stabilization period exemption to emission limits by the start-up/shutdown exemption would not relax the State Implementation Plan. This explanation is given in a discussion of the potential emissions impacts of the rule revisions in Section IV of this report. C. Public Hearing Notice Period Subsequent to the public workshop and addressing the comments, District staff released the amended rule language and prepared a public hearing notice for the hearing which will be held November 12, The notice was sent to all the same parties which received the public workshop notice. The hearing notice was also published in The Davis Enterprise, The Woodland Daily Democrat, and the Vacaville Reporter newspapers. A copy of the public hearing notice and updated documents (proposed staff report and proposed rule language), were posted on the District s web page. In response to the notice, the District received the following comments: Comment 1. Response 1. Comment 2. Response 2. Nicole Law of US EPA indicated that the proposed rule was acceptable and EPA had no further comments. Comment noted. Mr. Anthony Pocengal with Solar Turbines Inc. submitted a comment letter stating that the proposed 43 ppmv NOx limit during startup may not be attainable for all turbines, particularly the smaller units manufactured by Solar. He proposed that the startup limit by revised to 70 ppmv. The District notes that the proposed startup limit is derived from mass-based limits associated with larger turbines and agrees that smaller units may not follow the same emissions profile during startup as a larger unit. Furthermore, the District recognizes that data regarding actual NOx concentrations during startup of turbines are extremely limited and that, in establishing an emission limit that will apply during startups, care must be taken to ensure that an unattainable standard is not established. The District is enacting a numerical limit on startup Page 15

18 NOx emissions to close a perceived loophole in the rule, rather than with the intention of producing any actual emission reductions. Therefore, the District will revise the proposed NOx startup limit to 70 ppmv at 15% O 2 as suggested. Comment 3. Response 3. Comment 4. Response 4. Comment 5. Response 5. Mr. Pocengal also commented that the requirement to begin operating SCR as soon as it will be effective, and no later than 550 F, will be sufficient to ensure startup emissions are minimized, so a numerical limit is not necessary. See comments 1 and 3 from the additional regulatory notice and the associated responses. The District has previously argued that emissions will be minimized by operational requirements like the minimum SCR activation temperature requirement. Recent litigation has led EPA to begin requiring the closure of perceived loopholes in SIPs created by startup and shutdown exemptions from emission limits. Therefore, some sort of numerical cap on NOx emissions during startup is required for SIP approval of the rule. Mr. Pocengal also commented that the proposed rule defines gas fuels to include natural gas, landfill gas, and digester gas, but that landfill and digester gases have compositions and qualities that can vary substantially. As the fuel characteristics can vary substantially from natural gas, the resulting emissions can potentially be much higher, especially if contaminants in the fuel gas will interfere with common emission reduction and control devices. Mr. Pocengal proposes that such alternative gaseous fuels be subject to separate, higher emission limits or evaluated on a case-by-case basis. The District agrees that it can be inappropriate to subject a unit fired on such alternative gaseous fuels to the same emission limit that the same unit can meet when fired on a commercially-available gaseous fuel of consistent quality and properties. Since there are no turbines in the District subject to this rule and operating on alternative gaseous fuels, the District is revising the definition of gaseous fuels to include only commercial natural gas and liquefied petroleum gas. Any future unit operating on an alternative gaseous fuel will be subject to BACT and evaluated on a case-by-case basis. Mr. Pocengal also commented that ISO correction is unnecessary for turbines equipped with dry low-nox burners. Both the current and the proposed rule include frequent references to ISO conditions, and this terminology is an integral part of the emission standards. References to ISO conditions will not be deleted. The District incorporated the above comments, as determined appropriate. A copy of the updated documents (final staff report and final rule language) were provided to the Governing Board prior to the hearing and posted on the District s web page. VIII. REFERENCES - AP 42 Compilation of Air Pollution Emission Factors, Fifth Edition, Section 3.1, Stationary Gas Turbines, Published April, 2000 Page 16

19 ATTACHMENT A PROPOSED RULE 2.34, STATIONARY GAS TURBINES STRIKE-OUT UNDERLINE VERSION

20 ATTACHMENT B NOTICE OF EXEMPTION FROM CEQA GUIDELINES

21 Notice of Exemption To: County Clerk County of Yolo 625 Court Street, Room 105 Woodland, CA County Clerk Solano County 600 Texas Street Fairfield, CA From: Project Title: Yolo Solano Air Quality Management District 1947 Galileo Court, Suite 103 Davis, CA Revision of Rule Stationary Gas Turbines Project Location: Project Description Yolo Solano Air Quality Management District The revision of Rule 2.34 will lower the NOx emission limits of various categories of stationary gas turbines. The revision will also introduce separate start-up period exemptions from the emission limits for simple cycle and combined cycle turbine power plants. Name of Public Agency Approving Project: Name of Person or Agency Carrying Out Project: Yolo Solano Air Quality Management District Yolo Solano Air Quality Management District Exempt Status: Ministerial Emergency Project Categorical Exemption (CEQA Guidelines Section 15308, Action by Regulatory Agency for Protection of the Environment) Statutory Exemption Reason why project is exempt: The revision of Rule 2.34 is an action taken to protect the environment and is therefore exempt from CEQA because it constitutes a Class 8 categorical exemption pursuant to CEQA Guidelines Lead Agency Contact Person Mat Ehrhardt, Air Pollution Control Officer Telephone Number (530) Signature: Date: Title:

22 Notice of Exemption To: County Clerk County of Yolo 625 Court Street, Room 105 Woodland, CA County Clerk Solano County 600 Texas Street Fairfield, CA From: Project Title: Project Location: Yolo Solano Air Quality Management District 1947 Galileo Court, Suite 103 Davis, CA Revision of Rule Stationary Gas Turbines Yolo Solano Air Quality Management District Project Description: The revision of Rule 2.34 will lower the NOx emission limits of various categories of stationary gas turbines. The revision will also introduce separate start-up period exemptions from the emission limits for simple cycle and combined cycle turbine power plants. Name of Public Agency Approving Project: Name of Person or Agency Carrying Out Project: Yolo Solano Air Quality Management District Yolo Solano Air Quality Management District Exempt Status: Ministerial Emergency Project Categorical Exemption (CEQA Guidelines Section 15308, Action by Regulatory Agency for Protection of the Environment) Statutory Exemption Reason why project is exempt: The revision of Rule 2.34 is an action taken to protect the environment and is therefore exempt from CEQA because it constitutes a Class 8 categorical exemption pursuant to CEQA Guidelines Lead Agency Contact Person: Mat Ehrhardt, Air Pollution Control Officer Telephone Number: (530) Signature: Date: Title:

23 ATTACHMENT C RESOLUTION NO

24 RESOLUTION NO RESOLUTION AMENDING YOLO-SOLANO AIR QUALITY MANAGEMENT DISTRICT RULE 2.34 WHEREAS, California Health and Safety Code section provides that an air quality management district shall adopt rules and regulations as may be necessary or proper to execute the powers and duties granted to, and imposed upon, the district by Division 26 of the Health and Safety Code; and WHEREAS, Health and Safety Code section provides that before adopting, amending, or repealing a rule or regulation, a district board shall make findings of necessity, authority, clarity, consistency, nonduplication, and reference, based upon information developed pursuant to section , information in the rulemaking record maintained pursuant to section 40728, and relevant information presented at the public hearing required by section 40725; and WHEREAS, section of the CEQA Guidelines provides that actions taken by regulatory agencies as authorized by state law to assure the maintenance, restoration, or enhancement of the environment where the regulatory process involves procedures for protection of the environment, are categorically exempt from CEQA review (Class 8 Categorical Exemption); and WHEREAS, the purpose of amending Rule 2.34, Stationary Gas Turbines is to reduce gas turbine emission limits, require emissions control during turbine start-up, and establish a practical start-up period for combined cycle power plants. NOW, THEREFORE, BE IT RESOLVED that the Board of Directors of the Yolo- Solano Air Quality Management District hereby finds, authorizes, directs and declares as follows: 1. The Board of Directors has considered and hereby adopts by reference the staff report prepared in this matter. 2. The Board of Directors makes the following findings pursuant to Health and Safety Code section 40727: a. Necessity: Information in the District=s rulemaking record maintained pursuant to Health and Safety Code section demonstrates a need for amending District Rule 2.34; b. Authority: Health and Safety Code section permits the District to amend District Rule 2.34; c. Clarity: District Rule 2.34 as amended is written so that its meaning can be easily understood by the persons directly affected by it; d. Consistency: District Rule 2.34 as amended is in harmony with, and not in conflict with or contradictory to, existing statutes, court decisions, or state or federal regulations; e. Nonduplication: District Rule 2.34 as amended does not impose the same