DTE Gas Company - Belle River Mills Compressor Station SRN: B6478. Located at Puttygut Road, China, Saint Clair County, Michigan

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1 State Registration Number Michigan Department of Environmental Quality Air Quality Division RENEWABLE OPERATING PERMIT ROP Number B6478 STAFF REPORT MI-ROP-B DTE Gas Company - Belle River Mills Compressor Station SRN: B6478 Located at 5440 Puttygut Road, China, Saint Clair County, Michigan Permit Number: MI-ROP-B Staff Report Date: October 19, 2015 This Staff Report is published in accordance with Sections 5506 and 5511 of Part 55, Air Pollution Control, of the Natural Resources and Environmental Protection Act, 1994 PA 451, as amended (Act 451). Specifically, Rule 214(1) requires that the Michigan Department of Environmental Quality (MDEQ), Air Quality Division (AQD), prepare a report that sets forth the factual basis for the terms and conditions of the Renewable Operating Permit (ROP). Page 1 of 12

2 TABLE OF CONTENTS OCTOBER 19, STAFF REPORT 3 DECEMBER 9, STAFF REPORT ADDENDUM 9 Page 2 of 12

3 State Registration Number B6478 Michigan Department of Environmental Quality Air Quality Division RENEWABLE OPERATING PERMIT OCTOBER 19, STAFF REPORT ROP Number MI-ROP-B Purpose Major stationary sources of air pollutants, and some non-major sources, are required to obtain and operate in compliance with an ROP pursuant to Title V of the federal Clean Air Act of 1990 and Michigan s Administrative Rules for Air Pollution Control pursuant to Section 5506(1) of Act 451. Sources subject to the ROP program are defined by criteria in Rule 211(1). The ROP is intended to simplify and clarify a stationary source s applicable requirements and compliance with them by consolidating all state and federal air quality requirements into one document. This Staff Report, as required by Rule 214(1), sets forth the applicable requirements and factual basis for the draft ROP terms and conditions including citations of the underlying applicable requirements, an explanation of any equivalent requirements included in the draft ROP pursuant to Rule 212(5), and any determination made pursuant to Rule 213(6)(a)(ii) regarding requirements that are not applicable to the stationary source. General Information Stationary Source Mailing Address: DTE Gas Company - Belle River Mills Compressor Station 5440 Puttygut Road China, Michigan Source Registration Number (SRN): B6478 North American Industry Classification System (NAICS) Code: Number of Stationary Source Sections: 1 Is Application for a Renewal or Initial Issuance? Renewal Application Number: Responsible Official: Tom Anderson, Manager - Transmission and Storage Operations AQD Contact: Robert Elmouchi, Environmental Quality Analyst Date Application Received: February 13, 2015 Date Application Was Administratively Complete: March 2, 2015 Is Application Shield In Effect? Yes Date Public Comment Begins: October 19, 2015 Deadline for Public Comment: November 18, 2015 Page 3 of 12

4 Source Description The DTE Gas Company, Belle River Mills (BRM) Compressor Station located at 5440 Puttygut Road, China, Michigan, is a natural gas storage and transmission facility. DTE Gas Company owns and operates several facilities in Michigan, which are used for both natural gas storage and transmission. DTE's Belle River Compressor Station receives sweet natural gas from various suppliers across the United States and Canada, which it stores in its natural underground storage field. The underground storage field is used as reservoir during the warmer non-heating months to ensure DTE's customers will receive an uninterrupted supply of natural gas during the cooler heating months. Some of the engines at this facility are also used to boost the pipeline transmission pressure of natural gas as needed per transmission conditions and customer demand. The Belle River facility consists of five various sized horse power (HP) natural gas-fired 2-cycle lean burn reciprocating internal combustion engines (RICE), two 1,480 HP 4-cycle lean burn RICE, two natural gas-fired 4-cycle lean burn emergency generator RICE, one Low-NOx 15,000 HP natural gas-fired turbine engine, three natural gas fired boilers, seven process heaters, seven storage tanks, and one cold cleaner. The installation of two natural gas-fired turbines, one 10,915 HP and one 6,130 HP, has been approved per PTI no The natural gas-fired 2-cycle lean burn RICE and the three turbine engines (including the two aforementioned turbines pending installation) are used to increase the pressure of the natural gas to inject it into the underground storage field. The two 1,480 HP 4-cycle lean burn RICE are part of the refrigeration plant and are part of a process designed to remove heavy hydrocarbons during the withdrawal cycle when the field gas contains an unacceptable amount of heavy hydrocarbons. The turbine engines can be configured to inject or withdraw natural gas from the storage field by changing the attached centrifugal compressor. The majority of emissions from this storage facility are associated with the RICE and turbine engines. The following table lists stationary source emission information as reported to the Michigan Air Emissions Reporting System (MAERS) for the year TOTAL STATIONARY SOURCE EMISSIONS Pollutant Tons per Year Carbon Monoxide (CO) Nitrogen Oxides (NO x ) Particulate Matter (PM) 12.8 Sulfur Dioxide (SO 2 ) 0.3 Volatile Organic Compounds (VOCs) 43.3 In addition to the pollutants listed above that have been reported in MAERS, the potential to emit of Greenhouse Gases (GHG) in tons per year of CO2e (carbon dioxide equivalents) is 181,091 tons. CO2e is a calculation of the combined global warming potentials of six GHG (carbon dioxide, methane, nitrous oxide, hydrofluorocarbons, perfluorocarbons, and sulfur hexafluoride). See Parts C and D in the ROP for summary tables of all processes at the stationary source that are subject to process-specific emission limits or standards. Regulatory Analysis The following is a general description and history of the source. Any determinations of regulatory nonapplicability for this source are explained below in the Non-Applicable Requirement part of the Staff Report and identified in Part E of the ROP. The stationary source is located in Saint Clair County, which is currently designated by the U.S. Environmental Protection Agency (USEPA) as attainment for all criteria pollutants. Page 4 of 12

5 The stationary source is subject to Title 40 of the Code of Federal Regulations (CFR) Part 70, because the potential to emit nitrogen oxides (NOx), Carbon Monoxide (CO) and Volatile Organic Compounds (VOC) exceeds 100 tons per year. The potential to emit of any single HAP (formaldehyde) regulated by the federal Clean Air Act, Section 112, is equal to or more than 10 tons per year. the potential to emit of GHG is 100,000 tons per year or more calculated as CO2e and 100 tons per year or more on a mass basis. The source is subject to 40 CFR Part 60 Subpart JJJJ, standards of performance for stationary spark ignition internal combustion engines. FGRULE818ENGINES at the stationary source was subject to review under the Prevention of Significant Deterioration regulations of PART 18, PREVENTION OF SIGNIFICANT DETERIORATION OF AIR QUALITY, OF ACT 451 because at the time of New Source Review permitting the potential to emit of nitrogen oxides was greater than 250 tons per year. EU014, EU015 and EU016 were installed prior to August 15, As a result, this equipment is considered "grandfathered and is not subject to New Source Review (NSR) permitting requirements. However, future modifications of this equipment may be subject to NSR. Although EU017 and EU018 were installed after August 15, 1967 (June 1972), this equipment was exempt from New Source Review (NSR) permitting requirements per R36(c) at the time it was installed. However, modifications of these emission units began, respectively, in 2007 and 2008 in order to comply with Rule R (Rule 818) and therefore this equipment became subject to NSR. EUREFRIGPLANT at the stationary source is subject to the New Source Performance Standards for Standards of Performance for Equipment Leaks of VOC from Onshore Natural Gas Processing Plants promulgated in 40 CFR, Part 60, Subparts A and KKK. EUREFRIGPLANT was evaluated to determine if it is subject to 40 CFR Part 61 Subpart V, National Emission Standards for Equipment Leaks. A rough analysis by AQD staff, based upon gas analysis data, appeared to indicate that the fluid contained or in contact with the equipment is expected to have less than 0.5 percent volatile hazardous air pollutant (VHAP) by weight. Additionally, per an received by the AQD from the applicant on January 13, 2009, the VHAP concentration is expected to be less than 1 percent. The AQD calculated VHAP value and the applicant s calculated VHAP value appear to be in agreement and both values appear to indicate the VHAP concentration throughout EUREFRIGPLANT will be less than 1 percent, which is less than 10% of the applicability threshold. Therefore, this facility does not appear to be subject to 40 CFR Part 61 Subpart V. EUDEHY at the stationary source is subject to the Maximum Achievable Control Technology Standards for National Emission Standards for Hazardous Air Pollutants from Natural Gas Transmission and Storage Facilities promulgated in 40 CFR Part 63 Subparts A and Subpart HHH. 40 CFR Part 63 Subpart HHH was revised in New applicable conditions have been added to this emission unit table. EU014, EU015, EU016, EU017, EU018, EUBUGENSETTURBIN and EUEMERGENZBLDG at the stationary source are subject to the Maximum Achievable Control Technology Standards for National Emissions Standards for Hazardous Air Pollutants for Stationary Reciprocating Internal Combustion Engines promulgated in 40 CFR, Part 63, Subparts A and ZZZZ. EUENGINER1 and EUENGINER2 are subject to the New Source Performance Standards for Stationary Spark Ignition Internal Combustion Engines per (4)(i) promulgated in 40 CFR, Part 60, Subpart JJJJ because the emission units were manufactured after July 1, Page 5 of 12

6 FGTURBINES are subject to the New Source Performance Standards for Stationary Combustion Turbines per (a) promulgated in 40 CFR, Part 60, Subpart KKKK because the heat input at peak load is equal to or greater than 10.7 gigajoules (10 MMBtu) per hour, based on the higher heating value of the fuel, which commenced construction, modification, or reconstruction after February 18, Emission testing frequency is specified per 40 CFR The testing frequency may vary according to performance test results. FGENGINES In order for the Source to demonstrate compliance with Rule 301, the AQD has placed limitation on the fuel which may be burned in the RICE. The permit contains no requirements for opacity because the facility is allowed to combust only natural gas in these RICE and the combustion of natural gas should result in no visible emissions, thus resulting in compliance with Rule 301. It is also important to note that EU017 and EU018 in this flexible group are also in FGRULE818ENGINES, which also includes R301 as a UAR. EUREFRIGPLTBLR, EUZBLDGBLR, EUAUXBLDGBLR, EULT3BLR, EULT1BLR, EUTECHBLDGBLR, EUBATHHTR, EUHMOHTR, EUNUGHTR, EUSUGHTR, EUE36LINEHTR, EUW36LINEHTR andeu24linehtr are subject to 40 CFR Part 63 Subpart DDDDD (Industrial, Commercial, and Institutional Boilers and Process Heaters MACT). These emission units are in flexible group FG5DBOILERS and are existing Gas 1 Fuel Subcategory boilers and process heaters that utilize only natural gas. These existing boilers or process heaters must comply with 40 CFR Part 63 Subpart DDDDD no later than January 31, 2016, except as provided in 40 CFR 63.6(i). At this time, there are no GHG applicable requirements to include in the ROP. The mandatory Greenhouse Gas Reporting Rule under 40 CFR Part 98 is not an ROP applicable requirement and is not included in the ROP. The monitoring conditions contained in the ROP are necessary to demonstrate compliance with all applicable requirements and are consistent with the "Procedure for Evaluating Periodic Monitoring Submittals." The emission limitation or standard for carbon monoxide from EUENGINER1 and EUENGINER2 at the stationary source are exempt from the federal Compliance Assurance Monitoring (CAM) regulation under 40 CFR, Part 64, because 93% CO (formaldehyde surrogate) destruction efficiency is addressed by 40 CFR 63 subpart ZZZZ. Therefore, EUENGINER1 and EUENGINER2 are exempt from CAM requirements for carbon monoxide. Please refer to Parts B, C and D in the draft ROP for detailed regulatory citations for the stationary source. Part A contains regulatory citations for general conditions. Source-wide Permit to Install (PTI) Rule 214a requires the issuance of a Source-wide PTI within the ROP for conditions established pursuant to Rule 201. All terms and conditions that were initially established in a PTI are identified with a footnote designation in the integrated ROP/PTI document. The following table lists all individual PTIs that were incorporated into previous ROPs. PTIs issued after the effective date of ROP No. MI-ROP-B are identified in Appendix 6 of the ROP. PTI Number D Page 6 of 12

7 Streamlined/Subsumed Requirements This ROP does not include any streamlined/subsumed requirements pursuant to Rules 213(2) and 213(6). Non-applicable Requirements Part E of the ROP lists requirements that are not applicable to this source as determined by the AQD, if any were proposed in the ROP Application. These determinations are incorporated into the permit shield provision set forth in Part A (General Conditions 26 through 29) of the ROP pursuant to Rule 213(6)(a)(ii). Processes in Application Not Identified in Draft ROP The following table lists processes that were included in the ROP Application as exempt devices under Rule 212(4). These processes are not subject to any process-specific emission limits or standards in any applicable requirement. Exempt Emission Unit ID Description of Exempt Emission Unit Rule 212(4) Exemption Rule 201 Exemption EU00042 EULENNOXFURN#1 R (4)(b) R (b)(i) EU00043 EULENNOXFURN#2 R (4)(b) R (b)(i) EU00044 EULENNOXFURN#3 R (4)(b) R (b)(i) EU00046 EUJOHNSONFUR#1 R (4)(b) R (b)(i) EU00047 EUJOHNSONFUR#2 R (4)(b) R (b)(i) EU00048 EUJOHNSONFUR#3 R (4)(b) R (b)(i) EU00052 EUSOLARBLDGHTR R (4)(b) R (b)(i) EU00053 EURADHTR#1RPR R (4)(b) R (b)(i) EU00054 EURADHTR#2RPR R (4)(b) R (b)(i) EU00055 EURADHTR#3WELD R (4)(b) R (b)(i) EU00056 EURADHTR#4WELD R (4)(b) R (b)(i) EU00057 EURADHTR#5GAR R (4)(b) R (b)(i) EU00064 EUPUMPBLDGHTR R (4)(b) R (b)(i) EU00065 EUSTOCKRMHTR#1 R (4)(b) R (b)(i) EU00066 EUSTOCKRMHTR#2 R (4)(b) R (b)(i) EU00067 EUHOTWTRREPAIR R (4)(b) R (b)(i) EU00069 EUHOTWTRCONTRL R (4)(b) R (b)(i) EU00070 EUDEHYCATHTR#1 R (4)(b) R (b)(i) EU00071 EUDEHYCATHTR#2 R (4)(b) R (b)(i) EU00072 EUDEHYCATHTR#3 R (4)(b) R (b)(i) EU00073 EUDEHYCATHTR#4 R (4)(b) R (b)(i) EU00074 EUDEHYCATHTR#5 R (4)(b) R (b)(i) EU00075 EUDEHYCATHTR#6 R (4)(b) R (b)(i) Draft ROP Terms/Conditions Not Agreed to by Applicant This draft ROP does not contain any terms and/or conditions that the AQD and the applicant did not agree upon pursuant to Rule 214(2). Page 7 of 12

8 Compliance Status The AQD finds that the stationary source is expected to be in compliance with all applicable requirements as of the effective date of this ROP. Action taken by the MDEQ, AQD The AQD proposes to approve this ROP. A final decision on the ROP will not be made until the public and affected states have had an opportunity to comment on the AQD s proposed action and draft permit. In addition, the USEPA is allowed up to 45 days to review the draft ROP and related material. The AQD is not required to accept recommendations that are not based on applicable requirements. The delegated decision maker for the AQD is Chris Ethridge, Southeast Michigan District Supervisor. The final determination for ROP approval/disapproval will be based on the contents of the ROP Application, a judgment that the stationary source will be able to comply with applicable emission limits and other terms and conditions, and resolution of any objections by the USEPA. Page 8 of 12

9 State Registration Number Michigan Department of Environmental Quality Air Quality Division RENEWABLE OPERATING PERMIT ROP Number B6478 DECEMBER 9, STAFF REPORT ADDENDUM MI-ROP-B Purpose A Staff Report dated October 19, 2015, was developed in order to set forth the applicable requirements and factual basis for the draft Renewable Operating Permit (ROP) terms and conditions as required by R (1). The purpose of this Staff Report Addendum is to summarize any significant comments received on the draft ROP during the 30-day public comment period as described in R (3). In addition, this addendum describes any changes to the draft ROP resulting from these pertinent comments. General Information Responsible Official: AQD Contact: Tom Anderson, Manager - Transmission and Storage Operations Robert Elmouchi, Environmental Quality Analyst Summary of Pertinent Comments A summary of DTE Electric Company s comments to the draft ROP and AQD response follows below: 1. EUDEHY, VII. REPORTING, Special Condition 5. There is no condition VII.6 (as referenced in SC VII.5.c). Response: I reviewed the UAR in the ECFR and determined that this reference error could be resolved by adhering to the ECFR text which cites reference to 40 CFR (d). 2. EUDEHY, VII. REPORTING, Special Condition 5. There is no condition VII.6 (as referenced in SC VII.5.d). Response: I reviewed the UAR in the ECFR and determined that this reference error could be resolved by adhering to the ECFR text which cites reference to 40 CFR (d). 3. FGRULE818ENGINES, 40 CFR (b)(2)(ii) requires testing every three years or 8,760 hours which is not in agreement with only doing the test when requested. Response: It appears appropriate to accurately identify the shortest required testing frequency and, therefore, the testing frequency in the ROP has been changed to every three years or 8,760 hours. 4. FGBOILERS, DESCRIPTION, Emission Units Table. EU24LINEHTR heat input is 8.55 MMBtu/hr. EU24LINEHTR should be moved from the Equal to or greater than 10 MMBtu/hr. row to the Equal to or greater than 5 MMBtu/hr and less than 10 MMBtu/hr. row. Response: The AQD agrees. 5. EUDEHY, VII.4.a.i. The reference to Conditions VI is not valid. Response: The correct reference is Condition VI. 7. This has been corrected. 6. EUDEHY, VII.5.c and d. Two references to VII.6 are not valid. Response: The AQD agrees. The AQD corrected the reference to specify 40 CFR (d). Page 9 of 12

10 7. APPENDIX 4, FGTURBINES: a portion of the recordkeeping requirements that address emission calculations for FGENGINESR1-2 was deleted. Response: The AQD agrees and the deleted text has been restored. 8. FGTURBINES, V.3. Special condition V.3 is redundant to special condition V.1.b. Response: The AQD agrees. The redundant condition has been deleted. 9. FGRULE818ENGINES VI.6. The requirements of this special condition have been satisfied. This special condition, Special Condition VII.5, and associated text in Appendix 4 should be deleted. Response: The AQD agrees. The satisfied condition and associate appendix requirements have been deleted. 10. EUDEHY Appendix 7. The calculation requirements in Appendix 7 apply to a small glycol dehydration unit and should be removed because EUDEHY is a large glycol dehydration unit. Response: The AQD agrees. The calculation requirements in Appendix 7 have been deleted. 11. FGRULE818ENGINES, V.2. Add, at a minimum of to the second sentence of V.2 to clarify the testing frequency requirement. Response: The AQD agrees that adding, at a minimum of to the second sentence of V.2 may clarify the testing frequency requirement. 12. FGRULE818ENGINES, V.3. The testing requirement should identify the pollutants to be measured. Response: The AQD agrees. The pollutants have been identified in the special condition. 13. FGRULE818ENGINES, V.3. Add, of operation after 8,760 hours. Response: The AQD agrees. It appears logical to interpret that the CFR text refers to 8,760 hours of operation otherwise all subject engines would be required to conduct performance testing annually (24 hours/day * 365 days/year = 8,760 hours/year) and the option to test every 3 years would be logically excluded. Changes to the October 19, 2015, Draft ROP The following changes were made to the draft ROP. 1. EUDEHY, VII. REPORTING, Special Condition 5 now reads: Whenever a process change is made, or a change in any of the information submitted in the Notification of Compliance Status Report, the permittee shall submit a report within 180 days after the process change is made or as a part of the next Periodic Report, whichever is sooner. The report shall include: (40 CFR (f)) a. A brief description of the process change. b. A description of any modification to standard procedures or quality assurance procedures. c. Revisions to any of the information reported in the original Notification of Compliance Status Report under 40 CFR (d). d. Information required by the Notification of Compliance Status Report under 40 CFR (d) for changes involving the addition of processes or equipment. 2. FGRULE818ENGINES, V.4. now reads: The permittee shall conduct CO, NOx and VOC performance testing every 8,760 hours or three years, whichever comes first, to demonstrate compliance. (40CFR (b)(2)(ii)) 3. FGBOILERS, DESCRIPTION, Emission Units Table. EU24LINEHTR has been moved from the Equal to or greater than 10 MMBtu/hr. row to the Equal to or greater than 5 MMBtu/hr and less than 10 MMBtu/hr. row. Page 10 of 12

11 4. EUDEHY, VII.4.a.i. now reads: The permittee shall prepare and submit Leak Detection Reports annually. The reports shall be postmarked or received by the appropriate AQD District Office by March 15 for reporting period July 1 to December 31 and September 15 for reporting period January 1 to June 30. The report shall include certification by a responsible official of truth, accuracy, and completeness. (40 CFR (e)) a. The following information shall be included in the Reports. i. A description of all deviations as defined in Condition VI.7 that have occurred during the sixmonth reporting period. ii. For each inspection conducted in accordance with Condition VI.7 during which a leak or defect is detected, the records described in Condition VI.12 must be included. iii. If applicable, a statement identifying if there were no deviations during the reporting period. iv. The results of any periodic test conducted during the reporting period. v. Information necessary to demonstrate compliance with benzene emission limit. 5. EUDEHY, VII.5.c and d. The text now reads: Whenever a process change is made, or a change in any of the information submitted in the Notification of Compliance Status Report, the permittee shall submit a report within 180 days after the process change is made or as a part of the next Periodic Report, whichever is sooner. The report shall include: (40 CFR (f)) a. A brief description of the process change. b. A description of any modification to standard procedures or quality assurance procedures. c. Revisions to any of the information reported in the original Notification of Compliance Status Report under 40 CFR (d). d. Information required by the Notification of Compliance Status Report under 40 CFR (d) for changes involving the addition of processes or equipment. 6. APPENDIX 4, FGTURBINES: Deleted text was restored. The corrected text reflects the addition of EUTURBINET70 and EUTURBINEC50 per PTI No The FGTURBINES portion of APPENDIX 4 now reads: FGENGINESR1-2 AND FGTURBINES For each engine (EUENGINER1 and EUENGINER2) and each turbine (EUTURBINE1, EUTURBINET70, and EUTURBINEC50), the permittee shall use emission factors from sourcespecific testing (stack testing), as available for each engine and turbine included in FGENGINESR1-2 and FGTURBINES. This also applies to engine(s) from engine change-out(s). If emission factors from other sources are used, the permittee shall obtain the approval of the AQD District Supervisor before using the emission factors to calculate emissions. The permittee shall document the source of each emission factor used in the calculations. 7. FGTURBINES, V.3. Special Condition V.3 was redundant and has been deleted. 8. FGRULE818ENGINES. Special Conditions VI.6, VII.5 and Appendix 4, FGRULE818ENGINES have been deleted. 9. EUDEHY Appendix 7. The calculation requirements in Appendix 7 have been deleted. 10. FGRULE818ENGINES, V.2 now reads: Within 90 days after the onset of the first ozone season following installation of low emission combustion, the permittee shall verify CO emission rates from EU017 and EU018 by testing at owner's expense, in accordance with Department requirements. Testing shall be performed at a minimum of once every five years of operation and may be coordinated with the RO permit renewal issuance. No less than 30 days prior to testing, the permittee shall submit a complete test plan to the AQD. The AQD must approve the final plan prior to testing. Verification of emission rates includes Page 11 of 12

12 the submittal of a complete report of the test results to the AQD within 60 days following the last date of the test. 2 (R , R , R , R , 40 CFR 52.21(j)) 11. FGRULE818ENGINES, V.3 now reads: The permittee shall conduct CO, NOx and VOC performance testing every 8,760 hours of operation or 3 years, whichever comes first, to demonstrate compliance. (40CFR (b)(2)(ii)) Page 12 of 12