South Coast Air Quality Management District

Public Hearing to Amend Rule 1421 – Control of Perchloroethylene Emissions from Dry Cleaning Systems

SYNOPSIS: 

Proposed Amended Rule 1421 will reduce perchloroethylene (perc) from dry cleaning operations through a gradual transition to non-perc alternatives. This amendment was developed to implement part of the Air Toxics Control Plan approved by the Board in March 2000 and the source-specific measures as part of the Rule 1402 adoption process.

COMMITTEE: 

Stationary Source, February 22, March 22, September 27, 2002, and October 25, 2002

RECOMMENDED ACTION:

Adopt the attached resolution:

1. Certifying the Final Environmental Assessment (EA) for Rule 1421 – Control of Perchloroethylene Emissions from Dry Cleaning Systems;
   
   
2. Amending Rule 1421 – Control of Perchloroethylene Emissions from Dry Cleaning Systems.

Barry R. Wallerstein, D.Env.
Executive Officer

Background

Perchloroethylene (perc), also known as tetrachloroethylene, is a synthetically produced organic compound having industrial use as a solvent in degreasing and cleaning. According to a number of international, federal, and state authoritative bodies, perc is a possible/probable human carcinogen and contributes to both chronic and acute health impacts. The health impacts of perc are to the central nervous system, eye and respiratory irritation, kidney, and gastrointestinal system/liver. A recent study by Ruder et al in the American Journal of Industrial Medicine (2001) concluded that "The current study confirms findings of prior updates and other studies that dry-cleaning workers have excess cancer mortality rates at several sites." Perc is currently found in soil, groundwater, and wastewater, as well as the ambient air in the AQMD Basin.

The MATES II Final Report, March 2000 identified perc as one of six key toxic air contaminants in the Basin. Although perc emissions were shown to have decreased since the early 1990’s, perc is still present in the ambient air. The study determined that the major contributors of perc in the ambient air were dry cleaners, with approximately two-thirds of the emissions, and degreasers with approximately one-third of the emissions. Other emissions were attributed to consumer products, industrial solvent use, printing, and other uses. The inventory for MATES II was based on 1998 data. Since that time the Board has adopted Rules 1122 – Solvent Degreasers, and 1425 - Film Cleaning and Printing Operations, which will decrease perc emissions by 210 tons per year and 27.5 tons per year, respectively. Work during the rule development process has resulted in revised perc estimates from dry cleaners (decreased emissions). The relative contribution of perc emissions from dry cleaners is still the majority of perc emissions from stationary sources, given the implementation of the recently adopted rules listed above.

Dry cleaners using perchloroethylene as a cleaning solvent have been regulated by AQMD since 1980. Rule 1421 – Control of Perchloroethylene Emissions from Dry Cleaning Systems, was adopted in 1994 to reflect the requirements of the state Airborne Toxic Control Measure and the federal NESHAP. In September 1998, perc was added to Rule 1401 with risk values for cancer and chronic health effects. A risk value for acute health effects was added to Rule 1401 in August 1999.

In order to address the overall toxic risks identified from the MATES II study, the Board approved Air Toxics Control Plan on March 17, 2000, including a control measure for dry cleaners (Control Measure AT-STA – 02 Further Reductions of Perchloroethylene Emissions from Dry Cleaning Operations). Rule 1402 also identified perc dry cleaning as an industry to be evaluated for a source-specific approach. Both the Rule 1402 adoption resolution and the Air Toxics Control Plan direct staff to evaluate what perc reductions are possible, considering technical and economic feasibility. The staff proposal seeks to eventually reduce risk to zero through a gradual transition in the dry cleaning industry to non-perc alternatives that are currently commercially available and economically viable.

Industry Characteristics

Most dry cleaners are small businesses, operated by people employing fewer than five employees and often run by family members. According to the Korean Dry Cleaners and Laundry Association (KDLA), approximately 50% of the dry cleaners in the Basin are Korean-owned. There are approximately 2,100 facilities with 2,200 permitted perc dry cleaning machines. Most dry cleaners are located in residential-retail areas, near shopping, schools, day-care centers and restaurants. The cancer risks for dry cleaners are estimated to range from 20 to 140-in-one-million for residential exposures and 15 to 90 in-one-million for commercial exposures. Currently, perc equipment is either a machine with primary control only (refrigerated chiller), or primary and secondary controls (refrigeration and carbon absorption). A small number of machines are "converted" meaning their primary controls were add-on, as opposed to being integral at the time of being manufactured. About 100 dry cleaning facilities currently use a variety of non-perc alternatives. From August 2001 to August 2002, 19% of dry cleaning permit applications in the Basin were for hydrocarbon solvent machines.

Public Input

Staff worked extensively with industry, the environmental community, equipment manufacturers and other stakeholders to develop the proposal for amending Rule 1421, although consensus on a proposal has not been achieved. One of the biggest challenges in the rule development effort was to balance the need to protect public health and recognize that the industry is primarily small business and minority-owned. Tools employed by staff to assist in the rule development effort included Focus Groups, numerous evening meetings, working group meetings, an economist consultant to help evaluate potential facility-specific impacts, and numerous visits to dry cleaning establishments including some in the Bay Area and Sacramento.

Through the rule development process, staff has worked closely with stakeholders, including providing materials translated to Korean and translation services at public consultation meetings and the Public Workshop. Seven Working Group Meetings were held in August, September 2001, January, February, March, June and August 2002. The Working Group consisted of cleaning association representatives, industry representatives, chemical manufacturers, equipment manufacturers and distributors, environmental community representatives, and other government agencies.

The AQMD instituted a Focus Group program in order to ensure that the AQMD is receiving comments directly from those businesses being affected by its rulemaking activities. Small businesses frequently do not have time to actively participate in rule development workshops. Often, the comments received are from trade associations, chambers of commerce, or business advocacy groups whose members may not include the smaller, less-established businesses. Focus Group testing is an established method used by commercial market research firms, and can be used to ensure some direct participation by actual business owners in the rulemaking process.

Staff held an evening focus group on August 30, 2001 for Proposed Amendments to Rule 1421. Since many of the dry cleaners within the AQMD's jurisdiction are Korean, this Focus Group included owners and operators in the Korean community. This session was conducted with a Korean translator. A second Focus Group was held in Orange county in the city of Orange for non-Korean dry cleaners on October 24, 2001.

A Public Workshop and CEQA Scoping Session was held September 21, 2001. Additionally, five Public Consultation Meetings were held on October 17 and 25, 2001, March 27, April 10, and September 4, 2002. Most of these meetings were held in the evening hours and included Korean translations. Documents or key portions of documents were also translated into Korean, including workshop notices, rule proposal summaries and excerpts from the final Board package.

This rule development has generated significant comments from industry and from the public. Many dry cleaners have sent in postcards or signed petitions indicating their interest in continuing to use perc. Staff has also received e-mails, letters and cards from individuals requesting that perc use be discontinued. Industry and environmental groups have developed alternative proposals which are described in this Board letter under the Alternative Proposals section.

Proposed Amendments to Rule 1421

The staff proposal considered the issues raised by industry and attempts to address them by requiring equipment to be replaced with a non-perc alternative when it replaced (not to exceed 15 years) and starting mandatory replacements in July 2004 rather than upon rule adoption to minimize economic disruption. The proposed amendments to Rule 1421 will transition dry cleaners using perchloroethylene to non-perc alternatives through replacement of perc machines with alternative cleaning technologies when the dry cleaning systems are either replaced or newly purchased. The proposed amendment would require a new facility or a facility adding additional machines to purchase a non-perc alternative technology starting January 1, 2003. Older machines which have been converted to only primary controls would be required to be replaced with an alternative cleaning technology by July 1, 2004. Those machines currently operating with integrated primary controls and both integral primary and secondary controls would be required to transition to non-perc alternatives at the time of replacement, not to exceed 15 years. Thus, no primary machines would be operating after January 1, 2014 and no perc machines would be operating after July 1, 2019. Additional maintenance requirements and reporting for use in AB 2588 are included in the proposal.

Key Issues

Key issues include: the toxicity of perc; the risk associated with the newest perc machines; whether or not to require sources to eventually transition out of perc to non-perc alternatives; the viability and cost of the non-perc alternatives; potential flammability of some solvents; and the environmental trade-off of reducing a toxic air contaminant while increasing an ozone precursor.

Toxicity of Perc
Industry raised the issue that perc is not a human carcinogen based on their assessment of the available information and that therefore, it should not be further regulated. The EPA has listed perc as a hazardous air pollutant and probable human carcinogen. The Office of Environmental Health Hazard Assessment (OEHHA), from which the AQMD takes its lead for determining toxicity, has listed perc as a carcinogen with chronic and acute health effects.

Industry has pointed out that the North Carolina legislature reviewed perc dry cleaning in the year 2000 and did not recommend requiring a switch to non-perc alternatives. However, the North Carolina General Assembly passed laws requiring a significant surcharge on purchases of perc and other solvents to collect funds for cleaning up contaminated superfund sites. The surcharge for perc is $10 per gallon, added on to the purchase price of $7-$8 per gallon.

Perc Residual Risk
Industry contends that the latest perc machines will significantly reduce the usage of perc. They estimate that less perc will be emitted into the air, which results in lower risk estimates than staff’s calculation. The AQMD sampling, on average, showed 50% of perc used is emitted, with the resulting risk associated with perc machines equipped with primary and secondary controls (the newest technology) in a range from 15 to 90-in-one-million for commercial receptors. Staff believes that further risk reduction is necessary and achievable.

Requiring Non-perc Alternatives
One of the key policy issues for the Board’s consideration is the approach of a gradual transition that will result in the eventual turn-over of all perc dry cleaning equipment to non-perc alternatives. The goal of the rule development was to examine what technically and economically feasible approaches are available to minimize cancer risk in the neighborhoods near dry cleaners.

Industry contends that the AQMD only needs to achieve emission reductions below the action level of Rule 1402 (25-in-one-million). Industry also contends that no other rules have phased-out the use of a substance. However, staff does not agree with that approach. The staff’s goal is to reduce risk where technologically and economically feasible. There are other rules that require phase-out of toxics, where alternatives exist, such as Rule 1168 – Adhesive and Sealant Applications. Rule 1168 requires elimination of the emissions of methylene chloride, perchloroethylene, ethylene dichloride and trichloroethylene from the application of adhesives, adhesive bonding primers, sealants, sealant primers, or any other primers starting January 1, 2004. In addition, AQMD rules have effectively eliminated the use of certain other toxic substances or other chemicals in particular applications, such as, hexavalent chromium (Cr⁺⁶) in cooling towers (Rule 1404), chlorofluorocarbons (CFC) in hospital and commercial sterilization (Rule 1405), and CFC and methylene chloride in polyurethane operations (Rule 1175).

There are several non-perc alternatives that are proven in practice, established and economically feasible. Staff recommends a rule that moves the industry out of perc because there are non-perc alternatives available. During the twenty-two months of rule development, the number of wet cleaning and hydrocarbon cleaning establishments continued to grow. The District has approximately 100 dry cleaners using the hydrocarbon and non-VOC silicone-based solvents, ten dedicated wet cleaners and one using CO₂.

Viability and Cost of Non-perc Alternatives
Industry contends that the alternative technologies cannot clean all garments. No technology, including perc, can clean all stains and all garments. However, the alternative technologies are competitive in their cleaning ability as evidenced by the fact that Bay Area currently has approximately 15% of its dry cleaners using hydrocarbon machines and in Germany 99% of all new machines purchased are hydrocarbon. The majority of cleaning in Germany is done with a combination of wet cleaning and hydrocarbon technologies.

Industry also states that the alternatives require a longer cleaning cycle. Older hydrocarbon machines had longer cycle times than comparable perc machines. Machine manufacturers now make machines that have cycle times (from start to finish) that are comparable to perc machines. Industry also asserts that larger hydrocarbon machines are needed to have the same productivity as with perc equipment. The majority of equipment manufacturers do not support this claim. Staff knows of only one hydrocarbon machine manufacturer that suggests an operator buy one size up in equipment when switching from perc to hydrocarbon to accommodate a longer cycle.

Industry contends that costs can be higher for equipment and labor. While CO₂ can be quite expensive, wet cleaning can actually result in cost savings. The capital cost of hydrocarbon equipment is more expensive than perc, by approximately $10,000. This may be partially offset by savings in environmental fees. Regarding labor hours for spotting and pressing compared to perc, HC, Green Earth®, and wet cleaning operators have noted similar to slightly higher labor is needed. CO₂ labor requirements are similar to perc.

Potential Flammability of Solvents
Hydrocarbon solvents are moderately flammable, which is addressed through the equipment design. The equipment has thermostats to monitor the temperature and refrigeration systems to cool the solvent. The machines operate at a temperature approximately 30^° F lower than the solvent’s flash point. They are equipped with many safety features and those currently operating in the Basin have been approved by local fire agencies.

Environmental Trade-off
Concern has been expressed that the District is in non-attainment for ozone and needs VOC reductions. Increases in VOCs will result from dry cleaners that choose certain solvents. Industry has also raised a concern that VOCs from dry cleaners may be subject to future regulations.

Some hydrocarbon solvents contain VOCs. One silicone-based substance is non-VOC. The hydrocarbon equipment is subject to BACT to minimize VOC emissions and the residual emissions are offset through the AQMD offset bank. The CEQA analysis, which analyzes the range, including worst-case scenario, of all dry cleaners switching to the highest VOC material, and operating at an average maximum permitted level, showed an increase over time of up to 2.8 tons per day of VOC, with full rule implementation. This switch to the highest value VOC solvent is unlikely considering the market share this solvent currently has and the availability of other alternatives. Some cleaners will choose Green Earth™, which has no VOCs and others will go to wet cleaning or perhaps CO₂. Based on current basin-wide dry cleaning activity and actual solvent usage records, the more likely scenario would result in an average increase in VOC emissions of 0.11 tons per day in 2006, 0.26 tons per day in 2010, and 0.57 tons per day in 2018. The 1999 AQMP has accounted for such VOC conversions and included sufficient control strategies to meet attainment deadlines. While staff cannot guarantee that no future regulations will be proposed for VOCs from dry cleaners, it is not likely given the amount of projected VOC increases, the BACT process for New Source Review, and the overall attainment strategy. Finally, perc creates localized cancer risks while ozone health impacts (e.g., lung irritation) are regional.

Alternative Proposals

Staff received proposals from industry which reflected their effort to bring together the various affected parties. The most recent industry proposal, which is supported by Halogenated Solvents Industry Alliance, Inc., International Fabricare Institute, and the California Cleaners Association would require all machines to have primary and secondary controls by November 1, 2007 and would require all dry cleaners comply with the action risk level (25 in a million) of Rule 1402 by January 1, 2006. This proposal would result in replacing approximately 1,450 machines with primary controls only with primary and secondary machines. Total perc emissions would be reduced by approximately 140 tons per year after 2007. Dry cleaners would have to accept permit limits on gallons of perc used.

The environmental community supports the basic concept that staff has proposed, but wants to accelerate the implementation. They propose a 10-year phase out of perc, starting right away. With this approach, 850 tons per year of perc would be reduced by the year 2013, compared to the year 2019 with the staff proposal.

Staff appreciates the proposal efforts put forth by all parties involved.

California Environmental Quality Act (CEQA)

AQMD staff reviewed the proposed amendments to Rule 1421 pursuant to state CEQA Guidelines §15002 (k)(3) and the AQMD’s Certified Regulatory Program (codified in Rule 110). A Draft Environmental Assessment (EA) was originally circulated for a 45-day public review and comment period from December 19, 2001 to February 1, 2002. Thirteen public comment letters and postcards with identical comments from 143 dry cleaning facilities were received. Based upon these public comments and concerns expressed by industry during public meetings, staff conducted sampling on both perchloroethylene and hydrocarbon machines to better characterize usage and emissions. The results of the source testing do not change any of the conclusions in the original Draft EA. However, in an effort to make this new information available to the public for review and comment, it was incorporated into a revised Draft EA, which was recirculated for a 45-day public comment and review period. Six comment letters were received. An additional, extensive comment letter was received 2 weeks after the close of comments. Responses to this last letter are being prepared but cannot be included in the final EA due to the lateness and extent of the comment letter. A separate document will be prepared for staff’s responses. The revised Draft EA identifies potential adverse significant impacts to air quality and hazards. Potentially significant air quality impacts may result from VOC increases from operation of hydrocarbon machines. Significant adverse hazard impacts are not expected, but were analyzed due to the moderate flammability of some non-perc solvents. The lead agency need only respond to those comments submitted in response to the revised EIR. However, responses were prepared for the original comment letters and staff has included them in the Final EA.

Socioeconomic Assessment

A Socioeconomic Assessment is included as part of the Board package. The socioeconomic analysis indicates a high-end estimated cost of $4.3 million per year. The average control cost is about $3/lb of perc reduced. The average high-end estimated cost per operator, assuming a switch to hydrocarbon cleaning, will be $2525 per year. For the Basin, as a whole, 51 jobs per year will be forgone (not created in the future) from all sectors. The estimated increased cost to consumers is a maximum of 0.04 percent.

As part of continual refinement of the current AQMD socioeconomic analysis, the AQMD hired a consultant to develop new socioeconomic analysis tools for the purpose of conducting facility-based assessments. A protocol for conducting facility-based socioeconomic impact assessments was tested on the proposed amendments to Rule 1421. The affordability portion of the facility-based analysis was somewhat limited due to the unreliability of reported gross revenue and percent profit before taxes. Nonetheless, it is evident that small businesses sometimes lack the ability to raise capital. Therefore, staff’s proposal includes a 15-year equipment use, and 20-month lead time. An independent proposal for financial incentives will be presented by staff for consideration by the Board.

AQMP and Legal Mandates

Rule 1421 is not an AQMP requirement or a legal mandate. It is an air toxic rule that would implement part of the Air Toxics Control Plan and the source-specific measures the Board directed staff to evaluate as part of the adoption of Rule 1402.

Resource Impacts

Existing AQMD resources will be used to implement the rule. AQMD inspectors routinely inspect dry cleaning establishments.

Attachments (14,127 KB)

Summary of Proposal
Key Issues and Responses
Rule Development Process
Key Contacts List
Resolution
Proposed Amended Rule
Staff Report
Final Environmental Assessment (EA) for Rule 1421 – Control of Perchloroethylene 
        Emissions from Dry Cleaning Systems
Final Socioeconomic Report

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