Boiler MACT, NAAQS Revisions and Other Clean Air Act Developments. September 20, 2012 H. Carl Horneman

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1 Boiler MACT, NAAQS Revisions and Other Clean Air Act Developments September 20, 2012 H. Carl Horneman

2 Industrial, Commercial & Institutional Boilers, Process Heaters and Waste Incinerator Rules Final rules published March 21, 2011 National Emission Standards for Hazardous Air Pollutants for Major Sources: Industrial, Commercial and Institutional Boilers and Process Heaters ( Boiler MACT ) 76 Fed. Reg National Emission Standards for Hazardous Air Pollutants for Area Sources: Industrial, Commercial and Institutional Boilers ( Area Source Boiler Rule ) 76 Fed. Reg Standards of Performance of New Stationary Sources and Emission Guidelines for Existing Sources: Commercial and Industrial Solid Waste Incineration Units ( CISWI Rule ) 76 Fed. Reg Identification of Non-Hazardous Secondary Materials that are Solid Waste 75 Fed. Reg

3 Industrial, Commercial & Institutional Boilers, Process Heaters and Waste Incinerator Rules EPA Stay On May 18, 2011 the EPA stayed the effectiveness of its Boiler MACT and CISWI Rules, but left its Area Source Boiler Rule intact during reconsideration. 76 Fed Reg On December 23, 2011 the EPA published proposed amendments to its Boiler MACT and Area Source Boiler Rules. 76 Fed. Reg and On January 9, 2012, the US District Court for the DC Circuit vacated EPA s May 18 th Notice that delayed the effective dates of the Boiler MACT No Action Assurance Letters Issued on February 7, 2012, March 13, 2102 and July 18, 2012

4 Industrial, Commercial & Institutional Boilers, Process Heaters and Waste Incinerator Rules Boiler MACT 40 C.F.R. Subpart DDDDD Applies to boilers and process heaters at Major Sources (about 14,000 units). Issued under a court-imposed deadline with a reconsideration announcement included with the final rule notice. Impose significant new control costs. Numeric limits for mercury, dioxin, particulate matter, hydrogen chloride and carbon monoxide. Numeric emission limits reflect pollutant-by-pollutant MACT floor determinations and have been dubbed by industry as requiring a Frankenstein Boiler. Includes optional output based limits.

5 Industrial, Commercial & Institutional Boilers, Process Heaters and Waste Incinerator Rules Boiler MACT (cont.) Requires one-time energy assessments taking from one to three days to complete, depending on annual energy usage. Assessments include all operations that take 20-50% (varying with annual energy usage) of the energy produced by the unit. Applicable to boilers/process heaters exempt from CISWI Rule. Utilizes work practices rather than numeric limits for. Start up and shut down operations (follow manufacturer recommended procedures to minimize duration) Small boilers - <10 MMBtu/hr (biannual tune ups) Existing limited use boilers - < 10%/year (biannual tune ups) Natural gas, refinery gas or other clean fuel boilers (annual tune up only)

6 Industrial, Commercial & Institutional Boilers, Process Heaters and Waste Incinerator Rules Boiler MACT (cont.) Affirmative defense for malfunctions Sudden, infrequent and unavoidable failure of equipment Expeditious repairs with steps to minimize duration, emissions and reoccurrence Preponderance of the evidence Continuous emissions monitoring for PM emissions from large boilers (>250 MMBtu/hr) that burn coal, oil or biomass Stack test-based source specific operating limits

7 Industrial, Commercial & Institutional Boilers, Process Heaters and Waste Incinerator Rules Area Source Boiler Rule (40 C.F.R. Subpart JJJJJJ) 187,000 area source boilers in the U.S., with 2,400 expected to be constructed in the next 3 years. Significant improvements over proposed rule published in June Most limits are based on General Available Control Technology (GACT). Carbon monoxide limits, a surrogate for Polycyclic Organic Compounds (POM), are based Maximum Achievable Control Technology (MACT).

8 Industrial, Commercial & Institutional Boilers, Process Heaters and Waste Incinerator Rules Area Source Boiler Rule (cont.) Numeric limits apply to the following subcategories: New large (> 10 MMBtu/hr) coal-fired boilers New large biomass-fired boilers New large oil fired boilers Existing large coal-fired boilers Increased Hg and CO limits (proposed) Controlled hazardous air pollutants include: Non-mercury metallic hazardous air pollutants, using particulate matter as a surrogate Mercury Polycyclic organic compounds (POM), using carbon monoxide as a surrogate

9 Industrial, Commercial & Institutional Boilers, Process Heaters and Waste Incinerator Rules Area Source Boiler Rule (cont.) Work practice standards Tune ups with frequency of 24 months to 5 years. Start-up and shut down (follow manufacturer s recommended procedures to minimize duration). Energy assessment for large (>10 MMBtu/hr) boilers with complexity driven by annual energy usage. Proposed subcategory for seasonally operated boilers Compliance Demonstration Source testing every three (3) years for large boilers. No continuous emission monitoring requirement. Malfunctions Same affirmative defense provided in the Boiler MACT.

10 Industrial, Commercial & Institutional Boilers, Process Heaters and Waste Incinerator Rules Area Source Boiler Rule (cont.) Exemptions Natural gas-fired boilers (fuel oil backup during gas curtailment) Temporary boilers (proposed). Residential and electric boilers (proposed) Compliance dates New sources May 20, 2011 or start up Existing sources March 21, 2012 for work practice standards March 21, 2014 for numeric emission limits and energy assessment requirements.

11 EPA No Action Assurance Letters February 7, 2012 Letter. Enforcement discretion regarding Initial Notification requirements in Boiler MACT until earlier of year end or promulgation of final reconsideration rule Initial notifications due May 20, 2012 by existing sources; within 15 days of startup by new sources March 13, 2012 Letter Enforcement discretion regarding tune-up for Areas Source Boilers due by March 21, Grace period ends the earlier of Oct. 1, 2012 or date of final reconsideration rule. July 18, 2012 Expands enforcement discretion granted in March 13, 2012 letter to cover Notification of Compliance Status requirement (due July 19, 2012) and extends time for both to December 31, 2012.

12 National Ambient Air Quality Standards Reconsideration of Ozone Standard EPA announced in September 2011 that it would not continue reconsideration of the current standard. Fine Particulate (PM2.5 ) Standard On June 14, 2012 EPA proposed lowering annual fine particulate standard from 15 ug/m 3 to ug/m 3. It proposes to leave the 24- hr standard unchanged at 35 ug/m 3 set in Fed. Reg EPA wants to finalize proposal and make non-attainment designations by 2014, obligating states to comply with the lower standard by SO2 Administrator Jackson announced that her EPA is delaying nonattainment designations for the 2010 standard by one year. Environment Reporter, Vol. 43, No. 31 (August 3, 2012)

13 Cross-State Air Pollution Rule (CSAPR) Promulgated to Fulfill State Obligations To Prohibit Interstate Emissions Contribute significantly to nonattainment in, or interference with maintenance by, any other State with respect to any national primary or secondary ambient air quality standard. Clean Air Act, Section 110(a)(2)(D)(i)(I) Replaced Clean Air Interstate Rule (CAIR) found to be unlawful in North Carolina v. EPA, 531 F.3d 896 (D.C. Cir. 2008)

14 Cross-State Air Pollution Rule (CSAPR) Court Challenge 45 Review Petitions 67 Industry and Labor Petitioners 24 State and Municipal Petitioners State of New York and City of New York Intervening in Support of Petitioners Stay Issued December 30, 2011 Found to violate the Clean Air Act on August 21, 2012 US Court of Appeals for the DC Circuit vacated and remanded the rule, leaving CAIR rule in its place. EMS Homer City Generation v. EPA, No (D.C. Circuit, August 21, 2012).

15 Mercury and Air Toxic Standard (MATS) Requires emission reductions achievable utilizing Maximum Achievable Control Technology (MACT) Best-performing 12% of existing sources Average of best 5 sources if fewer than 30 sources exist in a subcategory For new sources, the best-controlled similar source Cost not considered

16 Mercury and Air Toxic Standard (MATS) Expected EGU mercury emission reduction - 90% Limitations and work practice standards address Mercury Furans Arsenic Acid Gases Nickel Hydrochloric Acid Dioxins SO 2 Excludes natural gas-fired EGUs

17 Mercury and Air Toxic Standard (MATS) Compliance Deadline Three Years from April 16, 2012 (effective date) Extendable one year if necessary for the installation of controls 42 U.S.C. 7412(i)(3)(B) Extendable further utilizing enforcement proceedings 42 U.S.C. 7413(a)

18 Mercury and Air Toxic Standard (MATS) Challenges National Mining Association Review Petition, D.C. Court of Appeals, Case No Joint Resolution of Disapproval under Congressional Review Act - introduced by Senator Inhofe, R-Okla. (S.J. Res 37, 112 th Congress Second Session) National Mining Association Petition to Reconsider. July 20, 2012 EPA granted the petition; July 27, 2012 issued a stay delaying the rule s effectiveness for three months