Is your facility in compliance with the Clean Air Act (CAA)? Most companies have recently submitted their Title V operating permit applications to address this very question. The Title V permit identifies which state and federal regulations apply to the facility and whether or not a facility is in compliance with each regulation based on current operating practices. However, day-to-day operations are subject to change as a result of the never-ending efforts to reduce costs and increase product quality. Without question, before such a change is implemented, you should ask yourself the following: "Will we continue to be in compliance with the CAA after this change?"

The CAA provisions of particular concern to most companies are the federal permitting requirements under the Prevention of Significant Deterioration (PSD) regulations. Complying with PSD permitting provisions is almost always a complicated, costly, and time-consuming process. Additionally, the resulting permit often imposes significant financial burdens and operational limitations. Even with these implications, many companies fail to assess whether operational changes trigger review under the PSD regulations.

In fact, the most commonly asked question is: "Why should my company be concerned with these PSD issues? We are not planning on any major expansions." To address this, let's consider the plausible ramifications of a couple of co-conspirators: the Title V operating permit program and the Compliance Assurance Monitoring (CAM) rule.

The CAM rule provisions were implemented as a means of demonstrating compliance with applicable requirements set forth in the Title V permit. In many cases, these provisions require continuous emissions monitoring systems for pollutants emitted in major quantities.

The information contained in Title V operating permit applications submitted to state and federal environmental agencies can be used to establish baseline emission levels for facilities. Baseline refers to the level of emissions from which changes are evaluated for applicability to state and federal permitting requirements. It should be noted that all state and federal permit conditions are applicable requirements and, as such, were included in the Title V application. Thus, the Title V application contains all of the tools necessary to not only evaluate compliance with present emission limits and standards but also the effect an operational change has on emissions.

Existing major sources may be subject to review under the PSD provisions when a physical or operational change results in a significant net emissions increase of any PSD-regulated pollutant. This type of change is referred to as a major modification. Physical changes govern the addition of new or modification of existing equipment to debottleneck the process. On the other hand, an operational change, or change in the method of operation, covers a very wide range of possibilities from the obvious to the obscure. The possibilities include changing process computer software, optimizing a process to improve its economics, and using different fuels such as tires.

Whatever the change, its effect on emissions and production capacity is the basis for evaluating for applicability to PSD permitting. Determining these effects is where the questions and concerns start. The general guidance from the Environmental Protection Agency hinges on the assumption that the change will increase the utilization of the affected source or sources. This assumption dictates evaluation as the difference between the potential emissions of the source or sources after the operational change and the existing actual emissions of said sources. The existing actual emissions are defined as the average of the most recent two years, whereas the potential emissions are calculated as the design rate of the equipment operating 8,760 hours per year. If this difference is greater than the established significant level for any PSD regulated pollutant, the operational change may be considered a major modification and be subject to PSD review.

Once triggered, PSD review mandates evaluation of the change under three key elements: control technology review, air quality analysis, and additional impacts analysis. The control technology review is the evaluation and determination of best available control technology (BACT). BACT is defined as:

"an emission limitation (including a visible emission standard) based on the maximum degree of reduction for each pollutant subject to regulation under the Act which would be emitted from any proposed major stationary source or major modification which the Administrator, on a case by case basis, taking into account energy, environmental, and economic impacts and other costs, determines is achievable for such source or modification."

The process of determining BACT has been mandated by the EPA to follow the top-down approach. The top-down approach consists of:

* Identification of all available technologies.

* Ranking of technologies in descending order of effectiveness.

* Elimination of technologies based on technical feasibility or adverse economic, environmental, or energy impacts.

The outcome of the analysis is further limited by maximum emission levels established under the New Source Performance Standards (NSPS) and National Emission Standards for Hazardous Air Pollutants (NESHAPs) regulations for applicable emission sources.

The air quality analysis entails demonstrating compliance with the PSD increments and National Ambient Air Quality Standards (NAAQS). The PSD increments were established as the maximum amount by which ambient air can be degraded in any given area. Increment levels have been established for particulate matter less than 10 microns in size (PM10), sulfur dioxide (SO2), and nitrogen dioxide (NO2). The specified value for a pollutant varies according to averaging time and Federal class designation of the impact area. NAAQS were designed to protect public health and welfare. Areas meeting NAAQS for a particular pollutant are classified as attainment, whereas those not meeting the standards are classified as non-attainment.

The final primary element of a PSD permit application is the additional impacts analysis. This analysis addresses the impairment to visibility, soils, and vegetation that result from the proposed activity, as well as from any associated commercial, industrial, residential, or other growth. Additional requirements may be imposed under certain circumstances, such as close proximity to a federally designated Class I area or nonattainment area.

Of the three, the BACT analysis is often the most feared aspect of a PSD review due to its long-term economic implications. The unsettling point is that the BACT analysis will yield an emission limit, but it will not force you to apply this type of control device. The level of this limit is directly dependent on the cost of achieving it. However, there is no guideline as to what level of cost is economically feasible. Thus, it is not inconceivable to be forced to apply a significantly expensive control device. Or worse, apply the control device and be forced to further reduce emissions to comply with the limit. If this still sounds unsettling, that's because the PSD regulations mandate compliance with the emission limit established in the BACT analysis.

Still, of all the ways one can be subjected to PSD review, there are ways to avoid it. The principal method employed is offsetting the emissions increase such that a significant net emissions increase does not occur. However, this option is usually not available after the fact. Another method is to accept permit conditions limiting the emissions increase to less than the PSD significance levels. The overall key to PSD avoidance is evaluation of the idea prior to implementation of the idea.

So, to illustrate how PSD might be unintentionally triggered, let's look at the following two examples.

Example 1

A cement manufacturing facility is at sold-out capacity and has additional demands for its product. Wanting to capitalize on the opportunity, the process engineers are charged with determining the best way to expand production in a cost-effective and timely manner. The engineers quickly determine the limiting factor for production is the finish mill capacity. They estimate the plant can increase production 20% by adding an additional finish mill. As an environmental safeguard, the process engineers recommend using state-of-the-art pollution control devices on the new mill. Intuitively, using state-of-the-art controls should eliminate any environmental concerns with the new mill. Additionally, the return on investment, including the pollution control devices, is very compelling. Does the cement manufacturing facility have PSD concerns relating to increasing the finish mill capacity?

This change would be viewed as a de-bottlenecking activity under the PSD regulations. EPA guidance on de-bottlenecking dictates evaluation of all affected sources within the facility, not just the one being added or modified. Therefore, the net emissions increase is calculated as the difference in new potential and existing actual emissions for the entire cement plant. Kiln emission increases associated with this level of production increase would undoubtedly be greater than the PSD significance thresholds, thereby being subject to PSD review.

Example 2

Always looking to reduce costs, the facility evaluates an alternative fuel to offset coal usage. The potential supplier provides a specification sheet and a laboratory analysis. The alternative fuel will be stored indoors on a bermed concrete slab and will be conveyed to the coal weigh belt by a new screw conveyor. From there, the material will be fed along with the coal using existing equipment. Should the facility be concerned about PSD in utilizing this fuel?

The following additional information is needed to make the determination:

* The plant typically operates with an uptime of 85%.

* The kiln system removal efficiency is 99% for lead.

* The coal feed rate is 25 tph.

* The coal heat content is 12,000 btu/lb.

* The coal analysis indicates an average of 15 ppm lead.

* The maximum alternative fuel feed rate is planned for 3 tph.

* The alternative fuel analysis indicates 2500 ppm lead.

* The alternative fuel has a heat content of 8,000 btu/lb.

Based on a cursory review, problems are not expected with commencing use of the alternative fuel. Before moving forward, the fuel substitution is evaluated according to EPA guidelines to determine the existing actual and new potential emissions. The emissions changes are illustrated in the following chart.

According to the chart, implementing the fuel substitution without reviewing the CAA implications would result in the facility being in violation of PSD. However, by determining the effect on emissions ahead of time, the facility can properly address the substitution by getting a construction permit with a federally enforceable condition to limit lead emissions. In doing so, the facility will remain in compliance with the CAA.