BOARD MEETING DATE: September 5, 2008
AGENDA NO. 45

PROPOSAL:

Amend Rule 1146.1 - Emissions of Oxides of Nitrogen from Small Industrial, Institutional, and Commercial Boilers, Steam Generators, and Process Heaters

SYNOPSIS:

The proposed amendments will further reduce NOx emissions from boilers, steam generators, and process heaters with maximum rated heat input capacities greater than 2 million Btu per hour and less than 5 million Btu per hour by lowering the applicable NOx emission limits beginning 2012 through 2015, depending on fuel and burner type used. The proposed amendment will, in part, implement the 2007 AQMP Control Measure MSC-01 - Facility Modernization.

COMMITTEE:

Stationary Source, April 25, May 16, and June 20, 2008

RECOMMENDED ACTIONS:

Adopt the attached resolution:

  1. Certifying the Final Environmental Assessment (EA) for Proposed Amended Rule 1146.1 - Emissions of Oxides of Nitrogen from Small Industrial, Institutional, and Commercial Boilers, Steam Generators, and Process Heaters; and,
  2. Amending Rule 1146.1 - Emissions of Oxides of Nitrogen from Small Industrial, Institutional, and Commercial Boilers, Steam Generators, and Process Heaters.
     

Barry R. Wallerstein, D.Env.
Executive Officer

Background

Proposed Amended Rule 1146.1 was originally identified as control measure MSC-01 in the 2007 Air Quality Management Plan (AQMP). The purpose of that measure was to reduce NOx emissions from boilers and process heaters rated between 2 and 5 million Btu per hour.

Rule 1146.1 was originally adopted in October 5, 1990 and developed pursuant to the 1989 Air Quality Management Plan (AQMP) of the South Coast Air Quality Management District (AQMD). The rule established a 30 ppm NOx emission limit for units with an annual heat input greater than 18,000 therms. For units that did not exceed an annual heat input of 18,000 therms the owner or operator was required to either install a non-resetting fuel use totalizing meter or provide fuel use bills from a fuel supply company based on metering of fuel use indicating that the limit was exceeded. In addition, these low fuel usage units must comply with the rule by either semiannual tune-ups or maintaining stack gas oxygen concentrations at less than 3 percent on a dry basis.

There were two amendments to this rule. The first amendment occurred on July 10, 1992. The 1992 amendments specified either District Method 100.1 as the required test method for NOx, CO and O2, or Methods 7.1 for NOx and 10.1 for CO and O2. On May 13, 1994 Rule 1146.1 was amended to add a tune up procedure for natural-draft units. This addition provided guidelines for tuning natural draft-fired units that have not exceeded 18,000 therms per year gross heat input from all fuels burned.

The 2007 AQMP was adopted by the Governing Board in June 2007. The plan was designed to demonstrate attainment with national ambient air quality standards for ozone and PM2.5 and make progress toward attaining the state air quality standards. The 2007 AQMP contains control measure MCS-01 calling for additional NOx emission reductions from various non-RECLAIM combustion sources including boilers and heaters.


Affected Facilities

PAR 1146.1 affects a wide variety of industries within the South Coast Air Basin. Boilers and heaters subject to PAR 1146.1 include those used in medical facilities, educational institutions, office buildings, hotels, and industrial facilities. Staff has estimated that there are about 1,070 active permitted units in the District in the size range affected by this rule. When grouped according to the Standard Industrial Classification (SIC), the educational services account for about 24% of the units, while health services industry has approximately 10% of the units that are subject to the rule. The food industry contributes about 8% of the units and apartments comprise 7% of the total. Hotels and other lodging places have about 4% share of the total Rule 1146.1 units. The remaining 47% of the units are distributed over 52 other SIC categories.


Public Process

The rule development process started with the PAR 1146 effort. This has been ongoing process since January 2006 to assess low NOx technologies for boilers, steam generators, and process heaters. Staff held a Rule 1146.1 Task Force meeting on February 5, 2008 and in parallel with further Rule 1146 rule development efforts, held Rule 1146.1/1146 Task Force meetings on July 10, 2008 and August 14, 2008. A PAR 1146.1 Public Consultation meeting was held on March 19, 2008 and a joint PAR 1146.1/1146 Public Workshop on April 2, 2008. In assessing applicable technology, staff has held individual meetings and conference calls with manufacturers of boilers, steam generators, and process heaters. These meetings included representatives from the manufacturers, trade organizations, permit holders for units subject to Rule 1146.1, and other interested parties. At these meetings low NOx technology, equipment useful lives, and proposed emission limits, and cost implications were discussed.


Summary of Proposal

The proposed amendment to this rule would reduce the allowable emission limits of NOx applicable to boilers and similar combustion units. In an effort to improve compliance, the proposed amendments significantly strengthens the monitoring requirements of the rule. It is also the intent of this proposed amendment to harmonize the NOx compliance limits with those limits proposed for Rule 1146 – Emissions of Oxides of Nitrogen from Industrial, Institutional, and Commercial Boilers, Steam Generators, and Process Heaters.

The proposal lowers the currently in effect 30 ppm NOx limit for natural gas fired units with sealed-combustion to 9 ppm (or 0.011 lbs/106 Btu) and 12 ppm (or 0.015 lbs/106 Btu) for atmospheric units. In addition, the proposed NOx limits for landfill gas fired and digester gas fired units are 25 ppm, and 15 ppm, respectively. Compliance will occur over a three year period starting in January 2012.

The proposed rule amendment also introduces a weighted average formula for duel fueled co-fired units, compliance testing frequency compatible with RECLAIM sources in the same size range, monitoring of NOx emissions with a portable analyzer, and extending the compliance date for health facilities complying with state seismic safety requirements.


Emission Reductions and Cost Effectiveness

There are approximately 1,070 boilers that may be affected by the proposed amendments. The proposed rule amendment is estimated to reduce approximately 0.29 tons per day of NOx emissions by 2015, which reflects an overall 71% reduction in NOx emissions from this source category. The average cost effectiveness estimates for boilers and heaters affected by the proposed amendment range from $14,400 to $33,500 per ton. The cost differential is attributed to unit size, types of burners, and the unit’s operation and load.


Key Issues

Staff received many comments on the proposed rule at the public workshop, consultation meeting, and task force meetings. In addition, attendees provided letters summarizing their comments at the workshop and other meetings. From these comments, the following key issues have been identified: (1) achieving the 9 ppm NOx compliance level on a consistent basis, (2) achieving the 9 ppm NOx compliance level for atmospheric units, (3) lowering the NOx compliance level for thermal fluid heaters, and (4) application of portable analyzer method, and (5) Supplemental firing biogas with natural gas. It is staff’s understanding that most of the key issues identified have been resolved. These key issues and staff’s responses are summarized in Attachment B.


AQMP and Legal Mandates

The California Health and Safety Code requires the AQMD to adopt an Air Quality Management Plan to meet state and federal ambient air quality standards and adopt rules and regulations that carry out the objectives of the AQMP. The Health and Safety Code also requires the AQMD to implement all feasible measures to reduce air pollution. This proposed amendment of Rule 1146.1 relies on feasible technologies to further reduce NOx emissions. The NOx reductions from this proposed rule amendment will further reduce emissions by 0.29 tons per day and help achieve compliance with federal and state ambient air quality standards for ozone, PM10 and PM2.5.


California Environmental Quality Act (CEQA) Analysis

Pursuant to California Environmental Quality Act (CEQA) Guidelines § 15252 and AQMD Rule 110, the AQMD has prepared an Environmental Assessment (EA) proposed amended Rule 1146.1. The Draft EA was released for a 30-day public review and comment period from July 2, 2008 to July 31, 2008 and no comment letters were received from the public regarding the Draft EA. The environmental analysis in the Draft EA concluded that proposed amended Rule 1146.1 would not generate any significant adverse environmental impacts.

Since the release of the Draft EA, minor modifications have been made to the document. However, none of the modifications alter any conclusions reached in the Draft EA, nor provide new information of substantial importance relative to the draft document. As a result, these minor revisions do not require recirculation of the Draft EA pursuant to CEQA Guidelines § 15073.5. Therefore, the Draft EA is now a Final EA and is included as an attachment to this Governing Board package.


Socioeconomic Analysis

Proposed amendments to Rule 1146.1 (PAR 1146.1) would affect 618 facilities with at least one boiler or process heater (a total of 1,072 units) in the District. The affected facilities belong to a number of industries. The most affected in terms of number of units are in the sectors of educational services, professional, scientific, and technical services, and government.

The average annual cost of PAR 1146.1 is estimated at $2.6 million between 2012 and 2020. The majority of the cost will incur in the sectors of educational services ($0.36 million), government ($0.26 million), health care services ($0.26 million), and professional, scientific and technical services ($0.23 million).

PAR 1146.1 is projected to have 16 jobs forgone annually in the entire four-county economy between 2012 and 2020 (less than one-hundredth of one percent of the total four-county employment).
 

Resource Impacts

Existing staff resources are adequate to implement the proposed amendments.

Attachments (ZIP, 890k)

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


This page updated: June 26, 2015
URL: ftp://lb1/hb/2008/September/080945a.htm