Projected Actual Emissions - MARAMA

Projected Actual Emissions - MARAMA

Post Change Emissions

Emissions Increases: Step 1 of an

NSR Applicability Determination

in NSR Reform

Gerallyn Duke

March 27, 2011

1 1

Context

• NSR Reform was promulgated in 2002, then

challenged in the DC Circuit Court in 2006.

• The Court upheld the concept that Congress, via the

Clean Air Act, intended NSR to be based on

increases in actual emissions.

No“potential-to-potential” test (see vacature of Clean Unit

Test);

No exceptions to NSR for pollution control equipment (see

vacature of Pollution Control Exclusion).

2

Step One Basic Calculation

Post-change emissions

– pre-change emissions

= the emissions

increase

3

Emissions Factors

Emissions are basically calculated as the product of an emissions factor

(EF) and an activity level (AL):

E = EF x AL

AL can be the activity level over a day, a month, a year, etc.

Example: E = 5 lbs of VOC/widget x 100 widgets/year = 500 lbs

VOC/year

• EFs and ALs will vary depending on whether we are talking about the

past (what actually happened) or the future (what will happen).

4

Basic Concepts

• Baseline actual emissions (already covered)

• Post-change emissions will always be a

calculated value based on the projected

emission factor and projected activity level

after the change.

• Differences between how a unit operated

during the baseline period and how the unit

will be projected to operate in the future are

critical!

5

• Isolate the actual

emissions increase

relative to the

actual emissions

baseline that is

projected to occur

due solely to the

project.

• (should you choose to

accept it)

6

Baseline Operations vs.

Projected Operations

- How will the EF change?

- How will the AL change?

7

PAE: Part 1 – How long into the future?

Projected Actual Emissions (PAE): maximum annual

emissions rate, in tons per year, that an existing unit

is expected to emit in:

EITHER: one of the 5 years (12-month period) following the

date the unit resumes regular operation after the project;

OR: one of the 10 years following that date, if the project

involves increasing the unit’s design capacity or its PTE and

full utilization would result in either a significant increase by

itself or a significant net increase.

8

PAE: What not to do

•Do not base projected emissions on

average annual emissions expected to

occur, or

unreasonable assumptions.

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PAE: Part II – What to Include

• The maximum annual emissions rate must:

Include fugitive emissions for all source

categories;

Include emissions from start-up, shutdowns

and malfunctions;

Include known future applicable

requirements.

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PAE

Part III:

The

Projection

A unit’s maximum annual rate must be calculated as

the product of:

The projected emissions factor:

Based on the unit’s post-change reasonable

expectations;

Must take into account any legally

enforceable restrictions.

-The projected activity level:

Must be aligned with the unit’s historical

operation (e.g. downtime);

Must take into account all available

information on the expected and the highest

maximum post-change utilization.

PAE: Part IV – What to Exclude

• When calculating the increase in emissions resulting

from the project, EXCLUDE:

That portion of the projected actual emissions that the unit

could have physically and legally emitted during the baseline

period (the 24 month period used in calculating BAE);

AND that are unrelated to the particular project, including any

increased activity level (utilization) that could have been

achieved during the baseline period.

• Remember to keep the end in mind! You are trying

to capture the actual emissions increase due to the

project.

12

A Caveat

• A facility has the option of using PTE instead of PAE. In that case, the

calculation is simply the difference between BAE and the post-change

PTE for each unit.

• A facility cannot mix it up

Can’t use PAE for one pollutant and PTE for another for the same unit

Can’t mix PTE for some units and PAE for other units unless the units are completely

independent.

• Remember that in establishing PAE, a facility is projecting its business

plan for a project and operation of all units must conform to that plan.

• The permitting authority cannot require use of PTE in lieu of PAE for

existing units.

Projected actual emissions is not a limit taken to avoid NSR (e.g. 39 tpy

limit).

13

Example No. 1

• A facility produces red gumballs. Their product is

becoming popular and they want to expand the process

line. The current faceplate capacity is 50,000 gumballs/yr.

The modifications will result in an increase in faceplate

capacity of 100,000 gumballs/yr. Market projections in

their most recent annual report indicate sales over the next

ten years will increase to 80,000 gumballs/yr.

• During the 24 month baseline period chosen by the

company:

Average annual 24 month production was 40,000 gumballs;

The highest monthly throughput achieved during the 24

month period was 3600 gumballs/month.

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Example 1: Activity Level

New faceplate capacity = 100,000 gumballs/yr

Projected sales = 80,000 gumballs /yr

Activity Level

Existing faceplate

capacity = 50,000 gumballs /yr

Average annual production during

baseline period was 40,000 gumballs

Example 1: Activity Level x Emissions Factor = VOC Emissions

New PTE = 100,000 gumballs/yr x 5 lbs/gumball = 250 tpy

PAE = 80,000 gumballs /yr x 5 lbs/gumball = 200 tpy

Emissions

Existing PTE =

50,000 gumballs /yr x 5 lbs/gumball = 125 tpy

How much of the PAE is solely

due to the project?

BAE = 40,000 gumballs x 5 lbs/gumball =

100 tpy

Example No. 1

• What can be excluded?

Remember this cannot be a potential to potential test! You

cannot assume that the unit could reach and sustain its

faceplate capacity if it had never done so.

So….how much could the unit have produced and emitted had

there been a greater demand during the baseline period?

Look at short term production rates – what was the highest

production level the facility actually achieved during the baseline

period?

Make sure the short term production rate is achievable for a

sustained period of time.

Annualize the short term production rate.

17

Example 1: What can be excluded

New faceplate capacity = 100,000 gumballs/yr

Projected sales = 75,000 gumballs /yr

Activity Level

Existing faceplate

capacity = 50,000 gumballs /yr

Highest monthly production = 3600 gumballs/month x 12 months = 43,200 gumballs /yr

Average annual production during

baseline period was 40,000 gumballs

Example 1: Actual Emissions Related to the Change

PAE = 80,000 gumballs /yr x 5 lbs/gumball = 200 tpy

Emissions

43,200 gumballs x 5 lbs/gumball = 108 tpy

Actual emissions increase

related to the change = 92 tpy

BAE = 40,000 gumballs x 5 lbs/gumball =

100 tpy

Emissions that can be excluded

Example No. 2

• Same gumball process line;

• Of the 80,000 projection for gumball production,

they want to include production of 30,000 yellow

gumballs.

• Yellow gumballs have a VOC emission factor of 6 lbs.

of VOC per gumball. (Red ones had an EF of 5)

PAE

Red gumballs = 50,000 gumballs x 5 lbs/gumball = 125 tpy

Yellow gumballs = 30,000 gumballs x 6 lbs/gumball = 90 tpy

Total PAE = 215 tpy.

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Example 2: Actual Emissions Related to the Change

PAE = 215 tpy (80,000 total gumballs)

Emissions

43,200 red gumballs x 5 lbs/gumball = 108 tpy

Yellow gumballs =

90 tpy

Red gumballs=

125 tpy

Excludable emissions

But….

• You can only exclude that portion of the

projected actual emissions that you could

have accommodated during the baseline

period.

• The facility could not produce yellow

gumballs during the baseline period.

• So…

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Example 2: Actual Emissions Related to the Change

PAE = 215 tpy

Emissions

43,200 red gumballs x 5 lbs/gumball = 108 tpy

Yellow gumballs =

90 tpy

Red gumballs=

125 tpy

Total increase =

90 + 125 – 108 =

107 tpy

Excludable emissions

Example No. 3

• Same gumball process line;

• Of the 80,000 projection for gumball production,

they want to include production of 50,000 yellow

gumballs and 30,000 red gumballs.

PAE

Red gumballs = 30,000 gumballs x 5 lbs/gumball = 75 tpy

Yellow gumballs = 50,000 gumballs x 6 lbs/gumball = 150 tpy

Total PAE = 225 tpy.

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Example 3: Actual Emissions Related to the Change

PAE = 225 tpy (80,000 total gumballs)

Emissions

43,200 red gumballs x 5 lbs/gumball = 108 tpy

Yellow gumballs =

150 tpy

Excludable emissions

Red gumballs=

75 tpy

Example 3: Actual Emissions Related to the Change

PAE = 225 tpy

Emissions

43,200 red gumballs x 5 lbs/gumball = 108 tpy

Increase in

emissions

Excludable emissions

Red gumballs=

75 tpy

Example No. 4

•The company has decided to

switch entirely to yellow

gumballs.

•What is the emissions increase?

27

Example 4: Actual Emissions Related to the Change

PAE = 225 tpy

Emissions

Excludable emissions

The entire PAE is the emission

increase due to the project. No

baseline emissions can be

excluded.

Baseline emissions

Example No. 4 – back to red gumballs

• Go back to Example 1, with one change. The existing

permit sets a limit of 7 lbs VOC/gumball, but the

facility got an excellent purchase contract for a red

coating that is 5 lbs/gumball. There are two years left

on the contract.

Pre-change emissions

BAE = 40,ooo gumballs x 5 lb/gumball

PTE = 50,000 gumballs x ___lb/gumball

7

Excludable emissions = 43,200 gumballs x ___ 5 lbs/gumball

Post-change emissions

PAE = 80,000 gumballs x ___ 7 lbs/gumball

PTE = 100,000 gumballs x ____ 7 lbs/gumball

29

Example No. 5

• A refinery is proposing to install SNCR on a CO boiler in response to a consent

decree. The CD imposes new, lower emissions limits on NOx and SO2. The

facility proposes the following:

NOx SO2 CO PM10

BAE 1316 3101 415 564

PTE 1080 2200

PAE 581* 680*

Increase 0 0 PAE –

excludable

PAEexcludable

*Total capacity of the modified boiler is based on the capacity of the FCCU

which is 120,000 BPD. PAE is based on a throughput of 115,000 BPD.

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Example No. 5

• For NOx and SO2, the facility must meet a new, lower limit.

However, the PTE is based on maximum capacity

throughput (120,000, bpd) times a new lower emissions

limit. So the facility, for these pollutants is projecting that

they will operate at full throughput capacity.

• For CO and PM10 the facility is projecting that over the

next five years throughput will be less than full capacity, i.e.

115,000 bpd.

• Since PAE obligates the facility to commit to how they

intend to operate, you cannot mix PTE and PAE.

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A Few Things to Remember

Only emission increases are included in Step 1. If the

project includes shutting down a unit or restricting

operations at a unit, these reductions can only be

considered in Step 2 (netting).

There can be no negative numbers! If a unit’s post change

emissions are lower than the baseline actual emissions, the

increase is zero, i.e. there is no actual emissions increase.

When a company claims that their projected actual

emissions will be the same as their PTE – get

documentation. It is possible that this is true, but highly

unlikely.

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