BOARD MEETING DATE: March 4, 2005
AGENDA NO. 30

Amend Rule 1470 – Requirements for Stationary Diesel-Fueled Internal Combustion and Other Compression Ignition Engines and Authorize Additional Funding for Grants to Schools to Retrofit Diesel Backup Generators with PM Traps

SYNOPSIS:

Rule 1470 was adopted by the Board on April 2, 2004. The rule implements the Airborne Toxic Control Measure (ATCM) for Stationary Compression Ignition Engines that was adopted by CARB in February 2004. Due to subsequent changes to the ATCM, amendments to Rule 1470 are proposed for consistency with the ATCM. Proposed changes resulting from the finalized ATCM include addition of effective dates for rule requirements, definition modifications, and adding clarifying language. Additional funding of $150,000 from the Rule 1309.1 Priority Reserve Fund to an existing grant program to install PM traps on school-owned diesel backup generators on school grounds is also recommended.

COMMITTEE:

Stationary Source, January 28, 2005, Reviewed

RECOMMENDED ACTION:

Adopt the attached resolution:

1. Certifying the Final Environmental Assessment (EA) for Proposed Amended Rule 1470 – Requirements for Stationary Diesel-Fueled Internal Combustion and Other Compression Ignition Engines;
    
2. Amending Rule 1470 - Requirements for Stationary Diesel-Fueled Internal Combustion and Other Compression Ignition Engines; and
    
3. Approving additional funding to the existing Program Announcement PA #2005-05 in an amount not to exceed $150,000 to retrofit school diesel backup generators with PM traps from the Rule 1309.1 Priority Reserve Fund.

Barry R. Wallerstein, D.Env.
Executive Officer

Background

Rule 1470 – Requirements for Stationary Diesel-Fueled Internal Combustion and Other Compression Ignition Engines was adopted by the AQMD Governing Board on April 2, 2004. The rule implements the Airborne Toxics Control Measure (ATCM) for Stationary Compression Ignition Engines that was approved by the California Air Resources Board (CARB) in February 2004 (CARB ATCM). Rule 1470 also established more stringent requirements than the CARB ATCM for engines located on school grounds or within 100 meters of existing schools. The CARB ATCM was approved by the state Office of Administrative Law in November 2004 and is now operative in the state as of December 8, 2004.

Stationary compression ignition engines, defined as engines that remain in one location for 12 months or longer and typically categorized as either prime engines or emergency standby engines, are used in a wide variety of applications. Prime engines are stationary engines that are used for routine purposes in a wide variety of applications such as compressors, irrigation, cranes, rock crushers, and generators. Applications for emergency standby engines include providing emergency power for systems critical to human life (e.g., hospital and convalescent facility medical support systems). These engines use diesel fuel and emit particulate matter (PM), oxides of nitrogen (NOx), volatile organic compounds (VOC), and carbon monoxide (CO).

Affected Facilities

A wide variety of private and public entities owning and operating stationary diesel-fueled prime engines and emergency standby engines in the South Coast Air Basin are affected by Rule 1470. Industries and other entities affected include manufacturing, food processing and production, power generation, building management, hospitals, refineries, water treatment facilities, telecommunications and broadcasting facilities, quarries, military installations, and schools.

AQMD staff estimates that there are nearly 4,900 facilities with approximately 7,800 stationary diesel-fueled engines in AQMD’s jurisdiction, with around 97 percent of these engines being emergency standby engines. Compared with the version originally adopted in April 2004, proposed amendments to Rule 1470 are expected to have a minimal net impact on owners or operators of engines subject to the rule. Proposed amendments to the rule will primarily affect owners or operators of in-use emergency standby diesel fueled compression ignition engines enrolled in a demand response program and emergency generators used for firefighting purposes.

Proposal

Proposed Amended Rule (PAR) 1470 would reflect the changes made to the CARB ATCM subsequent to its initial adoption in February 2004. The final ATCM became operative on December 8, 2004. The primary purpose of the amendments is to ensure Rule 1470 is consistent with the CARB ATCM and is at least as stringent as the CARB ATCM, as required by Health and Safety Code section 39666(d). Proposed changes resulting from the finalized CARB ATCM include addition of effective dates for rule requirements, definition modifications, and to add clarifying language. Grammatical and typographical corrections are also proposed.

A summary of changes is as follows:

Definitions
For clarity, PAR 1470 will change a variety of definitions that have been slightly modified in the operative version of the CARB ATCM. Significant changes include adding definitions for "Transmission Constrained Area" and "Transmission Emergency" and amending the definition of "Emergency Use" to include allowances for pumping of water to maintain pressure in water distribution systems and to exclude fire training purposes. Fire training purposes are now addressed under the definition for "Maintenance and Testing".

Requirements
The most significant changes would add language to prohibit non-emergency operation of emergency engines on school grounds whenever there are school sponsored activities and specify an effective date of January 1, 2006 for emission limits for in-use emergency standby engines enrolled in a demand response program.

Compliance Requirements
Several minor modifications are proposed to Rule 1470 compliance requirements, including reporting for emergency standby engines to include fuel used and amount of fuel purchased and clarifying the schedule for owners or operators of three or fewer engines in the South Coast Air Quality Management District.

Exemptions
Several minor modifications are proposed to Rule 1470 exemptions, including modifying the exemption for new agricultural engines to add exemption from certain reporting requirements to eliminate reporting of duplicative information; simplified military training engine exemption; and adding requirements to allow delay in implementation of fuel requirement.

Funding Assistance

Schools or school districts which own emergency standby engines on school grounds may apply for funding under an AQMD program. On September 5, 2003, AQMD issued Program Announcement # 2004-01, which established a fund of $250,000 from the State’s Backup Generator Fund for installation of PM traps on diesel backup generators. This funding was subsequently supplemented with $132,500 from the Rule 1309.1 Priority Reserve Fund. To date, 11 schools have been awarded a total of $382,500 to retrofit 27 generators. On October 1, 2004, AQMD issued Program Announcement PA #2005-05 which made available to schools an additional $250,000 from the Rule 1309.1 Priority Reserve Fund for installation of PM traps on school-owned diesel backup generators on school grounds. Due to number of requests received, AQMD staff recommends that an additional $150,000 be added to PA #2005-05 to more fully accommodate interest from schools.

Public Process

During the PAR 1470 rulemaking process, staff conducted a Public Workshop/CEQA Scoping Meeting on January 13, 2005 to present the proposed amended rule. Approximately 50 people attended, with six individuals providing comments at the meeting. Written comments were received from one entity. All comments are responded to in the PAR 1470 Final Staff Report.

Key Issues

• Under Rule 1470, the implementation schedule for owners or operators of four or more 1989 and earlier engines must bring 25 percent of their engines into compliance by January 1, 2006. The CARB ATCM has been amended to delay this initial compliance date to January 1, 2007. Attendees of the January 13, 2005 public workshop recommended that this initial compliance date be extended one year to January 1, 2007, consistent with the ATCM. Rule 1470 specifies an earliest compliance date of 2006 for these engines because these engines tend to be the oldest and highest emitters. Because Rule 1470 was originally adopted in April 2004, engine owners or operators will have nearly two years to comply with this implementation schedule. In addition, Rule 1470 provides flexibility to owners by allowing them to select which engines they would like to bring into compliance first, provided they meet the 25 percent requirement.
   
• AQMD staff was asked to clarify the meaning of the term "school sponsored activities". AQMD staff solicited CARB staff guidance to develop an interpretation of school sponsored activities as being those directly related to the school, including, but not limited to, education of students (e.g., classroom education, physical education, outdoor education), sports teams (e.g., practices, games, school-sponsored tournaments), school events (e.g., open houses, performances, and exhibitions), and school sponsored or sanctioned extracurricular clubs. In situations where school-age children are both housed and educated at a single location (e.g., boarding schools, juvenile detention facilities), limitations on non-emergency operation of emergency standby engines would be in effect only during school hours and when school-sponsored activities, as described above, were taking place. Activities not directly related to schools, including those of organizations (e.g., AYSO soccer, parks and recreation sports teams, community events, and weekend and after school programs not directly related to the school) renting or using facilities (e.g., classrooms, auditorium, sports facilities, playing fields), would not be considered as school sponsored activities.

AQMP and Legal Mandates

PAR 1470 is an air toxic rule that is not an AQMP requirement. Adoption of PAR 1470 will satisfy requirements, as specified in Health and Safety Code §39666 (d), to implement the CARB ATCM.

California Environmental Quality Act (CEQA) Analysis

Pursuant to the California Environmental Quality Act (CEQA) and the AQMD’s Certified Regulatory Program (Rule 110), staff has prepared an Environmental Assessment (EA) for Proposed Amended Rule 1470 – Requirements for Stationary Diesel-Fueled Internal Combustion and Other Compression Ignition Engines. The Draft EA, which was made available for a 30-day public review period from January 18, 2005 to February 16, 2005, concluded that Proposed Amended Rule 1470 would not result in a significant adverse effect on the environment. No comments were received on the draft EA. The final EA is included as part of the attached package for the public hearing on the proposed rule.

Socioeconomic Analysis

As described previously, PAR 1470 reflects incorporation of changes resulting from finalization of the CARB ATCM. Since most of AQMD’s requirements are the same as those of the state, a socioeconomic analysis is not required. Changes to other state requirements do not affect AQMD sources because AQMD has more stringent requirements. Therefore, there are no new socioeconomic impacts associated with PAR 1470.

Implementation and Resources

It is anticipated at this time that existing AQMD resources will be used to implement PAR 1470 requirements.

Attachments

1. Summary of Proposal
2. Key Issues and Responses
3. Rule Development Process
4. Key Contacts List
5. Resolution
6. Rule Language
7. Final Staff Report
8. Final Environmental Assessment

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