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PROPOSAL:

Amend Regulation XVII – Prevention of Significant Deterioration

SYNOPSIS:

This proposal will align the South Coast Air Quality Management District's Prevention of Significant Deterioration program with federal requirements. Specifically, the emissions applicability threshold will change from 25/40 tons per year for listed/unlisted sources to the federal level of 100/250 tons per year. The current definition of Volatile Organic Compound (VOC) and federal definition of actual emissions will be incorporated. In addition, the maximum allowable ground level concentration values for particulate matter, beryllium, and hydrogen sulfide will be changed to meet the current federal requirements. These amendments are not expected to affect air quality or emission levels.

COMMITTEE:

Stationary Source, June 18, 1999, Reviewed

RECOMMENDED ACTION:

Adopt the attached resolution

(a) Certifying the Environmental Assessment (Negative Declaration) for Regulation XVII, and
(b) Amending Regulation XVII – Prevention of Significant Deterioration.

Barry R. Wallerstein, D.Env.
Executive Officer

Background

The U.S. EPA has established preconstruction review programs for areas that are classified as attainment or non-attainment with respect to the federal clean air standards. These programs are known as Prevention of Significant Deterioration (PSD) and New Source Review (NSR), respectively. The goals of these programs are to maintain clean areas and help polluted areas attain the standards. NSR requirements are more rigorous than those for PSD. Given its extreme non-attainment status, the AQMD has had the most stringent NSR program in place for over 20 years.

Regulation XVII was originally adopted on October 7, 1988 to implement the federal PSD program. The regulation sets forth requirements for preconstruction review of major stationary sources locating or expanding in attainment areas. At that time, the South Coast Air Basin was in attainment for SO2 (the air basin now also attains the federal standards for NO2). The regulation mirrored the U.S. EPA requirements. In January 1989 the regulation was amended to lower the applicability level, and now applies to new or modified sources with an increase in potential-to-emit of either 25 or 40 tons per year depending on the source category. The U.S. EPA applicability levels are 100 or 250 tons per year depending on the source category.

At the time of Regulation XVII adoption in 1988, AQMD did not have PSD delegation from U.S. EPA. Regulation XVII is not applicable and effective until delegation by U.S. EPA. A delegation agreement between AQMD and U.S. EPA was signed by AQMD on June 6, 1994. U.S. EPA, however, did not sign the agreement until January 15, 1997 at which time the AQMD’s PSD delegation from U.S. EPA was considered official. U.S. EPA retains the right to review and enforce the federal PSD requirements.

In the delegation agreement U.S. EPA has indicated that they have determined that AQMD Regulation XVII generally meets the requirements of federal PSD regulation. U.S. EPA has two types of delegation. One is through a program approved in SIP and the other is through an agreement with U.S. EPA. Regulation XVII does not form part of the SIP as no emission reductions can be expected from the implementation of the PSD regulations prior to attainment of the clean air standards. The existing delegation agreement with U.S. EPA will, therefore, need to be renegotiated upon amendment of Regulation XVII.

Although AQMD is federally classified as attainment for SO2 and NO2, both are considered non-attainment pollutants, as they are precursors to PM10; and NO2 is also a precursor to ozone. Hence, the more rigorous NSR requirements continue to apply to emission increases of either pollutant. NSR requires modeling, offsets, and the most stringent control technology for emission increases.

In practice, PSD does not provide for any air quality benefits beyond NSR for the AQMD, now and for the near future. It does, however, impose significant additional administrative requirements on both the applicant and the AQMD. These requirements include an incremental consumption analysis, a different calculation procedure for emission increases, and additional noticing requirements.

Because these requirements create additional paperwork and administrative burden without a corresponding air quality benefit, the Permit Streamlining Task Force recommended that Regulation XVII be amended to align the applicability levels with the federal PSD levels. This may minimize the number of sources required to go through the additional air quality analysis required by PSD, even though relatively few sources go through PSD permitting in the South Coast Air Basin.

Proposal

The proposal will amend the applicability levels in Regulation XVII of 25/40 tons per year for listed/unlisted sources to the federal threshold levels of 100/250 tons per year. The current definition of VOCs will be amended to refer to Rule 102 – Definitions and the current federal definition for actual emissions will be included. The proposal also amends the allowable maximum ground level increases for particulate matter to the current federal levels. The monitoring requirements for particulate matter and lead have been aligned to match the federal requirements. Finally, the proposal amends the exemption levels from ambient monitoring for beryllium and hydrogen sulfide to match the current federal requirements. The amendments to Regulation XVII implement one of the recommendations of the Permit Streamlining Task Force, which were approved by the Governing Board in March 1999.

Subsequent to the set hearing package, staff received comments from California Air Resources Board (CARB) staff regarding the air basin designation for the desert portion of Riverside County and references to PM10 rather than Total Suspended Particles. Staff has included these revisions, which are identified by a double underline in the proposed amended rule.

Emissions and Cost Effectiveness

The proposed amendments do not affect emissions or air quality. They may provide a small, but unquantified, cost benefit due to the elimination of an administrative procedure for sources with a potential to emit between 25 and 100 tons per year.

Public Outreach

A public notice regarding the proposed amendment to Regulation XVII was mailed to over 5,000 permit holders and interested parties. A public consultation meeting was held on May 28, 1999. A list of questions and the responses are included in Attachment F.

Also included in Attachment F are questions received after the set hearing and the staff responses, shown in italics.

Socioeconomic Analysis

The AQMD has reviewed the proposal relative to the following criteria and has determined that there are no socioeconomic impacts.

Rule Adoption Relative to Cost-Effectiveness

On October 14, 1994, the Governing Board adopted a resolution that requires staff to address whether proposed rules being considered for adoption are being presented in rank order by cost effectiveness. The 1997 Air Quality Management Plan (AQMP) ranks, in order of cost-effectiveness, all of the proposed control measures for which costs were quantified. The proposed amendments to Regulation XVII are not part of the 1997 AQMP, but rather are being proposed to make Regulation XVII consistent with federal requirements.

Incremental Cost-Effectiveness

Health & Safety Code Section 40920.6 requires an incremental cost-effectiveness analysis when there is more than one control option which would achieve the emission reduction objective of the proposed amendments, relative to ozone, CO, SOx, NOx, and their precursors. Since the proposed amendments to Regulation XVII do not result in emission reductions, the incremental cost-effectiveness analysis requirement does not apply.

CEQA Analysis

The amendments to Regulation XVII are a "project" pursuant to the California Environmental Quality Act (CEQA). AQMD staff has reviewed the project pursuant to CEQA and has prepared an Environmental Assessment (EA) evaluating the potential environmental impacts associated with the proposed amendments. The Final EA may be found in the attachment.

Resource Impacts

The proposal will reduce the administrative burden associated with the current regulation. Thus, it reduces implementation workload and no additional staff or funding will be needed.

Attachments

Summary of Proposed Amendments
Rule Amendment Process
Key Contacts List
Resolution
Proposed Amended Rule
Public Comments and Responses
Final Environmental Assessment

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