No. 11-60158 IN THE UNITED STATES COURT OF APPEALS …...Energy Future Holdings Corp. 1601 Bryan...

No. 11-60158

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

LUMINANT GENERATION CO. LLC, STATE OF TEXAS, et al.,

Petitioners, v.

UNITED STATES ENVIRONMENTAL

PROTECTION AGENCY, et al., Respondents.

PRINCIPAL BRIEF OF PETITIONERS LUMINANT GENERATION CO. LLC

AND BIG BROWN POWER COMPANY LLC

P. Stephen Gidiere III Thomas L. Casey III Balch & Bingham LLP 1901 Sixth Ave. N., Ste. 1500 Birmingham, Alabama 35203 205-251-8100

Harry M. Reasoner Vinson & Elkins LLP 1001 Fannin St., Ste. 2500 Houston, Texas 77002 713-758-2358

Eric A. White Vinson & Elkins LLP 2200 Pennsylvania Ave. NW, Ste. 500 West Washington, DC 20037 202-639-6500

Stacey H. Doré General Counsel Energy Future Holdings Corp. 1601 Bryan Street, 41st Floor Dallas, Texas 75201

Stephanie Zapata Moore General Counsel Luminant Generation Company LLC 1601 Bryan Street, 22nd Floor Dallas, Texas 75201

Counsel for Luminant Petitioners July 23, 2012

Case: 11-60158 Document: 00511930725 Page: 1 Date Filed: 07/23/2012

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No. 11-60158 _____________________________________________________________

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT _____________________________________________________________

LUMINANT GENERATION CO. LLC, et al.,

Petitioners,

v.

UNITED STATES ENVIRONMENTAL PROTECTION AGENCY, et al.,

Respondents.

CERTIFICATE OF INTERESTED PERSONS

The undersigned counsel of record certifies that the following listed persons and

entities as described in the fourth sentence of Rule 28.2.1 have an interest in the

outcome of this case. These representations are made in order that the judges of

this Court may evaluate possible disqualification or recusal.

Balch & Bingham LLP (Counsel for Petitioners)

Big Brown Power Company LLC (Petitioner)

Boyd, David R. (Counsel for Petitioners)

Bracewell & Giuliani LLP (Counsel for Petitioners)

Casey, Thomas (Counsel for Petitioners)


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Doré, Stacey H. (Counsel for Petitioners and General Counsel for Energy Future

Holdings Corp.)

Energy Future Competitive Holdings Company (parent company of Texas

Competitive Electric Holdings Company LLC)

Energy Future Holdings Corp. (parent corporation of Energy Future Competitive

Holdings Company)

Gidiere, P. Stephen, III (Counsel for Petitioners)

Holder, Eric H., Jr., Attorney General, U.S. Department of Justice (Counsel for

Respondent)

Jackson, Lisa, Administrator, U.S. EPA (Respondent)

Luminant Generation Company LLC (Petitioner)

Luminant Holding Company LLC (parent company of Luminant Generation

Company LLC and Big Brown Power Company LLC)

McKinney, Steven G. (Counsel for Petitioners)

Moore, Stephanie Zapata (Counsel for Petitioners and General Counsel for

Luminant Generation Company LLC)

Moreno, Ignacia S., Assistant Attorney General, Environment and Natural

Resources Division, U.S. Department of Justice

Reasoner, Harry M. (Counsel for Petitioners)


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Texas Competitive Electric Holdings Company LLC (parent company of Luminant

Holding Company LLC)

Texas Energy Future Holdings Limited Partnership (parent organization of Energy

Future Holdings Corp.)

United States Environmental Protection Agency (Respondent)

Vinson & Elkins LLP (Counsel for Petitioners)

White, Eric A. (Counsel for Petitioners)

/s/ P. Stephen Gidiere III Counsel for Luminant Petitioners


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STATEMENT ON ORAL ARGUMENT

Petitioners Luminant Generation Co. LLC and Big Brown Power Co. LLC

(collectively “Luminant Petitioners”), contend that the Final Rule should be subject

to summary partial vacatur and remand, and have filed a motion requesting that

relief. Should the Court not grant that motion, oral argument would assist the

Court in resolving the legal issues presented in this case.


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TABLE OF CONTENTS

CERTIFICATE OF INTERESTED PERSONS ....................................................... ii

STATEMENT ON ORAL ARGUMENT ................................................................. v

TABLE OF CONTENTS .......................................................................................... vi

TABLE OF AUTHORITIES ................................................................................. viii

GLOSSARY OF TERMS AND ACRONYMS ........................................................ 1

STATEMENT OF JURISDICTION.......................................................................... 2

STATEMENT OF THE ISSUES............................................................................... 2

STATEMENT OF THE CASE .................................................................................. 3

STATUTORY AND REGULATORY BACKGROUND......................................... 5

I. The States Have Sweeping Discretion Under the Clean Air Act’s Cooperative Federalism Structure ................................................................... 6

II. EPA Has a Sharply Limited Role in Reviewing and Approving SIPs

and SIP Revisions ............................................................................................ 7 STATEMENT OF THE FACTS ............................................................................... 9

I. In 1999, Texas Created Its SB 7 Program to Reduce Air Emissions from Grandfathered Facilities and Submitted It to EPA as a Revision to the Texas SIP ............................................................................................... 9

II. In 2011, EPA Approved the SB 7 Program, But Disapproved § 116.911(a)(2) Solely Because It Had Previously Disapproved the Standard Permit for Pollution Control Projects (“PCPs”) ............................. 11

III. EPA Disapproved Texas’s Standard Permit for PCPs at the Same Time It Proposed to Disapprove § 116.911(a)(2) ....................................................... 13


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IV. The Present Case Was Held in Abeyance Pending This Court’s Review in Luminant I of EPA’s Disapproval of Texas’s Standard Permit for PCPs ............................................................................................. 18

V. In Luminant I, This Court Held Unlawful and Vacated EPA’s Disapproval of Texas’s Standard Permit for PCPs ....................................... 19

SUMMARY OF THE ARGUMENT ...................................................................... 22

STANDARD OF REVIEW ..................................................................................... 24

ARGUMENT ........................................................................................................... 25

I. Luminant I Is Dispositive of This Case and Requires Partial Vacatur and Remand of the Final Rule ....................................................................... 25

CONCLUSION ........................................................................................................ 31

CERTIFICATE OF SERVICE ................................................................................ 32

CERTIFICATE OF COMPLIANCE ....................................................................... 33

ADDENDUM OF STATUTES, RULES, AND REGULATIONS ........................ 34


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TABLE OF AUTHORITIES

Page(s) Cases Allied Local & Reg’l Mfrs. Caucus v. EPA,

215 F.3d 61 (D.C. Cir. 2000) .............................................................................. 24 Allied-Signal, Inc. v. U.S. Nuclear Regulatory Comm’n,

988 F.2d 146 (D.C. Cir. 1993) ...................................................................... 29, 30 Baker v. Richardson,

462 F.2d 81 (5th Cir. 1972) ................................................................................ 26 Baylor Univ. Med. Ctr. v. Heckler,

758 F.2d 1052 (5th Cir. 1985) .................................................................. 4, 25, 27 Burge v. Parish of St. Tammany,

187 F.3d 452 (5th Cir. 1999) .......................................................................... 4, 26 BCCA Appeal Group v. EPA,

355 F.3d 817 (5th Cir. 2003) .................................................................. 5, 6, 7, 24 Camp v. Pitts,

411 U.S. 138 (1973) ...................................................................................... 24, 27 Clean Air Implementation Project v. EPA, No. 96-1224,

1996 WL 393118 (D.C. Cir. June 28, 1996) ...................................................... 26 CleanCOALition v. TXU Power,

536 F.3d 469 (5th Cir. 2008) ................................................................................ 7 Cunningham v. Belleque,

151 F. App’x 511 (9th Cir. 2005) ....................................................................... 26 Fla. Power & Light Co. v. Costle,

650 F.2d 579 (5th Cir. 1981) ........................................................................ 5, 6, 8 Galveston-Houston Ass’n for Smog Prevention v. EPA,

289 F. App’x 745 (5th Cir. 2008) ......................................................................... 6


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Geyen v. Marsh,

775 F.2d 1303 (5th Cir. 1985) ............................................................................ 25 Hernandez-Rodriguez v. Pasquarell,

118 F.3d 1034 (5th Cir. 1997) ............................................................................ 26 Ky. Res. Council, Inc. v. EPA,

467 F.3d 986 (6th Cir. 2006) ................................................................................ 8 La. Envtl. Action Network v. EPA,

382 F.3d 575 (5th Cir. 2004) .............................................................................. 24 Luminant Generation Co. v. EPA,

675 F.3d 917 (5th Cir. 2012) (“Luminant I”) ..............................................passim Macktal v. U.S. Dep’t of Labor,

171 F.3d 323 (5th Cir. 1999) .............................................................................. 26 Michigan v. EPA,

268 F.3d 1075 (D.C. Cir. 2001) ............................................................................ 5 Natural Res. Def. Council v. EPA,

489 F.3d 1250 (D.C. Cir. 2007) .......................................................................... 30 New York v. EPA,

413 F.3d 3 (D.C. Cir. 2005) ................................................................................ 16 North Carolina v. EPA,

531 F.3d 896 (D.C. Cir. 2008) .............................................................................. 8 Sierra Club v. EPA,

314 F.3d 735 (5th Cir. 2002) .......................................................................... 6, 10 Sierra Club v. EPA,

315 F.3d 1295 (11th Cir. 2002) ............................................................................ 6 Simpson v. Sperry Rand Corp.,

488 F.2d 450 (5th Cir. 1973) .............................................................................. 26


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Texas v. EPA, 499 F.2d 289 (5th Cir. 1974) .............................................................................. 24

Train v. Natural Res. Def. Council, Inc.,

421 U.S. 60 (1975) ................................................................................................ 7 Federal Statutes 5 U.S.C. § 706(2) ..................................................................................................... 24 42 U.S.C. § 7409(b) ................................................................................................. 10 42 U.S.C. § 7410 .................................................................................................... 6, 8 42 U.S.C. § 7410(l) .............................................................................................. 8, 29 42 U.S.C. § 7410(k) ............................................................................................. 8, 11 42 U.S.C. § 7411(a)(4) ............................................................................................. 16 42 U.S.C. § 7607(b) ................................................................................................... 2 Federal Regulatory Materials 40 C.F.R. § 51.104(a) ................................................................................................. 7 40 C.F.R. § 52.21(b)(23)(1) ..................................................................................... 16 68 Fed. Reg. 40,865 (July 9, 2003) .......................................................................... 15 68 Fed. Reg. 64,543 (Nov. 14, 2003)....................................................................... 15 74 Fed. Reg. 48,467 (Sept. 23, 2009) ...................................................................... 17 75 Fed. Reg. 56,424 (Sept. 15, 2010) ...................................................................... 17 75 Fed. Reg. 64,235 (Oct. 19, 2010) ........................................................................ 11 76 Fed. Reg. 1525 (Jan. 11, 2011) ....................................................................passim


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State Statutes Tex. Util. Code § 39.264(c). ...................................................................................... 9 State Regulatory Materials1 30 Tex. Admin. Code § 116.617 .......................................................................passim 30 Tex. Admin. Code § 116.911(a)(2) ..............................................................passim 30 Tex. Admin Code. §§ 116.910–.931 ................................................................... 10 18 Tex. Reg. 8145 (Nov. 9, 1993) ........................................................................... 13 19 Tex. Reg. 3055 (Apr. 22, 1994) .......................................................................... 13 30 Tex. Reg. 6183 (Sept. 30, 2005) ......................................................................... 16 31 Tex. Reg. 515 (Jan. 27, 2006) ............................................................................. 15 Miscellaneous Texas Commission on Environmental Quality, Emissions Banking and

Trading of Allowances Program Audit 5-1, available at http://www.tceq.state.tx.us/assets/public/implementation/air/banking/reports/EBTA_program_2011_audit.pdf. ............................................................ 10

1 All citations to the Texas Administrative Code in this brief are to the

versions as submitted to and considered by EPA in the Final Rule, copies of which are included in the Addendum of Statutes, Rules, and Regulations. Any subsequent revisions to the regulations are not before the Court and not relevant to this appeal.


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GLOSSARY OF TERMS AND ACRONYMS

BACT Best Available Control Technology

CAA Clean Air Act

EPA U.S. Environmental Protection Agency

Hg Mercury

NAAQS National Ambient Air Quality Standards

NESHAP National Emission Standards for Hazardous Air Pollutants

NNSR Nonattainment New Source Review

NOX Nitrogen oxide

NSPS New Source Performance Standards

NSR New Source Review

PCP Pollution Control Project

PSD Prevention of Significant Deterioration

PTE Potential to Emit

Section 110 42 U.S.C. § 7410

SIP State Implementation Plan

SO2 Sulfur dioxide

Standard Permit for PCPs 30 Tex. Admin. Code § 116.617

Standard Permit Program 30 Tex. Admin. Code §§ 116.601–116.615

TCEQ Texas Commission on Environmental Quality


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STATEMENT OF JURISDICTION

Jurisdiction in this Court is proper under section 307(b) of the Clean Air

Act. See 42 U.S.C. § 7607(b). EPA’s Final Rule concerns only the Texas State

Implementation Plan (“SIP”), which is not nationally applicable. Id. The

consolidated petitions for review were timely filed on March 11 and 14, 2011.

STATEMENT OF THE ISSUES

1. Did the U.S. Environmental Protection Agency (“EPA”) act arbitrarily and

capriciously and contrary to law when it disapproved a revision to the Texas

SIP, 30 Tex. Admin. Code § 116.911(a)(2), that required “grandfathered

facilities” to comply with Texas’s Standard Permit for Pollution Control

Projects (“PCPs”)?2

2. EPA’s only rationale for disapproval of the SIP revision was its prior

disapproval of the Texas Standard Permit for PCPs. In the related case of

Luminant Generation Co. v. EPA, No. 10-60891, 675 F.3d 917 (5th Cir.

2012) (“Luminant I”) this Court found the PCP disapproval to be arbitrary

and capricious and contrary to law and vacated it. Is the EPA’s refusal to

vacate its disapproval in this case arbitrary and capricious and contrary to

2 EPA’s Final Rule at issue here (published at 76 Fed. Reg. 1525 (Jan. 11,

2011)) approves all aspects of Texas’s SB 7 Program except for 30 Tex. Admin. Code § 116.911(a)(2). In their petition for review, Luminant Petitioners only challenge EPA’s disapproval of § 116.911(a)(2), and no other aspects of the Final Rule are before the Court.


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law when the decision that was the sole ground for its disapproval has been

vacated by the Court?

STATEMENT OF THE CASE

The present appeal involves consolidated petitions for review by the State of

Texas and Luminant Petitioners3 challenging the U.S. Environmental Protection

Agency’s (“EPA”) disapproval of a proposed revision to the Texas Clean Air Act

SIP. See 76 Fed. Reg. 1525 (Jan. 11, 2011). The revision at issue concerns

Texas’s Standard Permit for PCPs,4 as incorporated into a regulatory program that

reduces emissions from “grandfathered” electric generating facilities (i.e., facilities

that had not previously been subject to certain permitting requirements because

they commenced construction prior to the adoption of regulations implementing

the 1971 Texas Clean Air Act).

The question presented here—whether EPA lawfully disapproved the Texas

SIP revisions concerning Standard Permits for PCPs—has been asked and

answered by this Court in a related case. See Luminant Generation Co. v. EPA,

No. 10-60891, published at 675 F.3d 917 (5th Cir. 2012) (“Luminant I”). In

3 Petitioners Luminant Generation Company LLC and Big Brown Power

Company LLC are referred to collectively here as “Luminant Petitioners.” 4 In general, a PCP is the installation of technology or equipment, or the use

of a technique, that reduces emissions. As explained by this Court, Texas’s regulations authorize a standard permit for PCPs “that reduce or maintain currently authorized emission rates for facilities authorized by a permit[.]” 30 Tex. Admin. Code § 116.617(a)(1); see Luminant I, 675 F.3d at 922–23.


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Luminant I, this Court unequivocally held unlawful EPA’s disapproval of Texas’s

Standard Permit for PCPs and vacated and remanded with instructions that EPA

act “most expeditiously” to reconsider Texas’s PCP regulations. 675 F.3d at 932–

33 (emphasis added). The sole basis for EPA’s disapproval here is its prior

disapproval of the Standard Permit for PCPs, 76 Fed. Reg. at 1527, which this

Court held unlawful in Luminant I. 675 F.3d at 929–33.

Petitioners urge that in light of the prior panel ruling and the applicable

standard of review that limits review to EPA’s rationale as stated in the rule, the

Court should vacate and remand EPA’s disapproval here. See Burge v. Parish of

St. Tammany, 187 F.3d 452, 466 (5th Cir. 1999) (“It is a firm rule of this circuit

that in the absence of an intervening contrary or superseding decision by this court

sitting en banc or by the United States Supreme Court, a panel cannot overrule a

prior panel’s decision.”); Baylor Univ. Med. Ctr. v. Heckler, 758 F.2d 1052, 1060

(5th Cir. 1985) (quoting Motor Vehicle Mfrs. Ass’n v. State Farm Mut. Auto. Ins.

Co., 463 U.S. 29, 50 (1983)) (“‘An agency’s action must be upheld, if at all, on the

basis articulated by the agency at the time of the rule making.’”).

Accordingly, Petitioners sought EPA’s agreement to vacate and remand its

ruling. Upon EPA’s refusal to do so, Petitioners filed a Joint Motion for Summary

Vacatur and Remand In Light of Intervening Decision on June 21, 2012. EPA

conceded its action was not sustainable on the present record but opposed the


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motion to vacate, asking instead that the Court stay the case for 90 days and

“remand the record” to EPA. Petitioners opposed EPA’s alternative relief. As of

the date of filing this brief, the Court has not yet ruled on Petitioners’ motion or

EPA’s alternative remedy.

STATUTORY AND REGULATORY BACKGROUND

This case takes place against the backdrop of the cooperative federalism

paradigm of the Clean Air Act. The Clean Air Act “establishes a comprehensive

program for controlling and improving the nation’s air quality through state and

federal regulation.” BCCA Appeal Group v. EPA, 355 F.3d 817, 821–22 (5th Cir.

2003). Congress chose a “cooperative federalism” structure to implement the

statute, dividing authority between the federal government and the States.

Michigan v. EPA, 268 F.3d 1075, 1083 (D.C. Cir. 2001); see also Fla. Power &

Light Co. v. Costle, 650 F.2d 579, 581 (5th Cir. 1981) (“Congress chose a balanced

scheme of state-federal interaction to implement the goals of the [Clean Air]

Act.”).

Consistent with this structure, EPA’s job is to promulgate National Ambient

Air Quality Standards (“NAAQS”) for certain pollutants (like sulfur dioxide

(“SO2”) and nitrogen oxide (“NOX”)), and to ensure that the minimum

requirements for air pollution control programs are met. BCCA Appeal Group, 355

F.3d at 822. The Clean Air Act, however, gives to the States “the primary


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responsibility” for determining how to achieve those standards and meet those

requirements within their own borders.5 Id. (citing 42 U.S.C. § 7407(a)); see also

42 U.S.C. § 7401(a)(3) (“[A]ir pollution prevention . . . is the primary

responsibility of States and local governments.”).

I. The States Have Sweeping Discretion Under the Clean Air Act’s Cooperative Federalism Structure

States achieve the NAAQS set by EPA through the development and

administration of State Implementation Plans, or “SIPs.” Fla. Power & Light Co.,

650 F.2d at 586–87. A SIP is the overall body of regulations that govern air

emissions in a State. It is approved by EPA and revised from time to time by the

State. See Sierra Club v. EPA, 315 F.3d 1295, 1296 (11th Cir. 2002).

In general, a State’s SIP must, “among other things . . . ‘include enforceable

emission limitations and other control measures, means, or techniques . . . as may

be necessary or appropriate’ to meet” the applicable NAAQS; “‘appropriate

devices, methods, systems, and procedures’ to ‘monitor, compile, and analyze data

on ambient air quality;’” and an enforcement program. See BCCA Appeal Group,

355 F.3d at 822 (summarizing 42 U.S.C. § 7410(a)(2)). But, “so long as the

ultimate effect of a State’s choice of emission limitations is compliance with the

5 NAAQS, which address the overall quality of the air in the environment, are translated by States into limitations on sources or groups of sources in order to achieve the overall mandated quality of the ambient air. See Galveston-Houston Ass’n for Smog Prevention v. EPA, 289 F. App’x 745, 747 (5th Cir. 2008); Sierra Club v. EPA, 314 F.3d 735, 737 (5th Cir. 2002); 42 U.S.C. § 7410.


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national standards for ambient air, the State is at liberty to adopt whatever mix of

emission limitations it deems best suited to its particular situation.” Train v.

Natural Res. Def. Council, Inc., 421 U.S. 60, 79 (1975) (emphasis added); see also

CleanCOALition v. TXU Power, 536 F.3d 469, 472 n.3 (5th Cir. 2008) (“[T]he

EPA has no authority to question the wisdom of a State’s choices of emission

limitations if they are part of a SIP that otherwise satisfies the standards set forth in

42 U.S.C. § 7410(a)(2).”). The Clean Air Act “supplies the goals and basic

requirements of [SIPs], but the states have broad authority to determine the

methods and particular control strategies they will use to achieve the statutory

requirements.” BCCA Appeal Group, 355 F.3d at 822.

B. EPA Has a Sharply Limited Role in Reviewing and Approving SIPs and SIP Revisions

When States revise their SIPs, as Texas has done here, those revisions are

submitted to EPA for approval. See 40 C.F.R. § 51.104(a) (“States may revise the

plan from time to time consistent with the requirements applicable to

implementation plans under this part.”). EPA’s role in reviewing those SIP

revisions is limited. As this Court has explained, “[t]he great flexibility accorded

the states under the Clean Air Act is . . . illustrated by the sharply contrasting,


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narrow role to be played by EPA.” Fla. Power & Light Co., 650 F.2d at 587.6

Accordingly, EPA’s review of SIP revisions is cabined and delineated by 42

U.S.C. § 7410, also referred to as section 110 of the Clean Air Act. Id. at 586–87

(explaining statutory standards for EPA review of SIP revisions).

Section 110 of the Clean Air Act is the benchmark against which a SIP

revision must be judged. Under section 110(l)—entitled “Plan revisions”—EPA is

to approve a SIP revision unless it determines that “the revision would interfere

with [1] any applicable requirement concerning attainment [of the NAAQS] and

reasonable further progress [toward attainment] . . . or [2] any other applicable

requirement[.]” 42 U.S.C. § 7410(l) (emphasis added); see also Ky. Res. Council,

Inc. v. EPA, 467 F.3d 986, 994 (6th Cir. 2006) (“[W]here the EPA does not find

that a SIP revision would interfere with attainment, approval of the revision does

no violence to the statute.”).

If the SIP revision meets the requirements in the Clean Air Act, EPA is

required to approve it. Id.; 42 U.S.C. §7410(k)(3) (“[T]he Administrator shall

approve [a SIP or SIP revision] as a whole if it meets all of the applicable

requirements of this chapter.”).

6 EPA is a creature of statute and has only the authority conferred upon it by

statute—in this case, the Clean Air Act. North Carolina v. EPA, 531 F.3d 896, 922 (D.C. Cir. 2008) (citing Michigan, 268 F.3d at 1081).


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STATEMENT OF THE FACTS

I. In 1999, Texas Created Its SB 7 Program to Reduce Air Emissions from Grandfathered Facilities and Submitted It to EPA as a Revision to the Texas SIP Pursuant to this cooperative federalism structure, Texas created a regulatory

program in 1999 to dramatically reduce emissions of air pollutants from

“grandfathered” electric generating facilities in the State—i.e., facilities that had

not previously been subject to certain permitting requirements because they

commenced construction in the 1970s prior to the adoption of regulations

implementing the Texas Clean Air Act. The program is known as the “SB 7

Program” because it was adopted by the Texas Legislature as Texas Senate Bill 7

(a bill that included an overall restructuring of the electric utility industry in the

State).7

In the years following its adoption, the SB 7 Program achieved substantial

reductions of NOX and SO2 emissions by grandfathered facilities in the State. The

legislation’s intent was to reduce the annual emissions of NOX by 50% and SO2

emissions by 25% from the total emissions reported to the State in 1997 by

grandfathered electric generating facilities. Tex. Util. Code § 39.264(c). In

practice, the program achieved even greater reductions. On average, these Texas

7 SB 7 is codified as Chapter 39 of the Texas Utilities Code. Section 39.264

is the specific provision of Chapter 39 that mandates emissions reductions for grandfathered electric generating facilities. See Add. 85.


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facilities have reduced NOX emissions by 71% and SO2 emissions by 32% from

1997 levels.8

As directed by the legislation, the SB 7 program and its permitting

requirements are implemented by the Texas Commission on Environmental

Quality (“TCEQ”). The program’s rules9 promulgated by TCEQ contain a

provision—30 Tex. Admin. Code § 116.911(a)(2)—that requires grandfathered

electric generating facilities to comply with, inter alia, the requirements of the

Standard Permit for PCPs. A Standard Permit for PCPs authorizes industrial

facilities to install and operate a PCP by way of a registration and review process

that imposes standardized requirements, including the requirement that the PCP not

interfere with the National Ambient Air Quality Standards (“NAAQS”).10

On January 3, 2000, Texas submitted the SB 7 Program, including

§ 116.911(a)(2), to EPA for review and approval into Texas’s SIP. Even though

the Clean Air Act gives EPA a deadline of eighteen months to act on a SIP

8 See Texas Commission on Environmental Quality, Emissions Banking and Trading of Allowances Program Audit 5-1, available at http://www.tceq.state.tx.us/assets/public/implementation/air/banking/reports/EBTA_program_2011_audit.pdf.

9 The SB 7 Program rules for grandfathered electric generating facilities are found at 30 Tex. Admin. Code §§ 116.910–.931.

10 NAAQS—as the name indicates—deal with ambient air quality, i.e., the overall quality of the air in the environment. See Sierra Club, 314 F.3d at 737; 42 U.S.C. § 7409(b). As this Court explained, “the PCP Standard Permit [is] unavailable for any PCP that has even the potential to cause a breach of the NAAQS[.]” Luminant I, 675 F.3d at 929.


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revision,11 EPA did not act on Texas’s submission at all for over a decade, with no

explanation for its delay. Meanwhile, businesses in Texas complied with the SB 7

requirements, including the Standard Permit for PCPs, to install expeditiously and

operate PCPs, reducing air emissions by hundreds of thousands of tons. See supra

note 8 and accompanying text.

II. In 2011, EPA Approved the SB 7 Program, But Disapproved § 116.911(a)(2) Solely Because It Had Previously Disapproved the Standard Permit for Pollution Control Projects (“PCPs”) In 2010, EPA finally proposed action on Texas’s SB 7 SIP revision. 75 Fed.

Reg. 64,235 (Oct. 19, 2010). EPA proposed to approve the inclusion of the SB 7

Program in the Texas SIP, with the sole exception of § 116.911(a)(2). Id. Overall,

EPA found that the SB 7 Program “will cause additional emission reductions and

ensure better protection of public health and welfare, and improve the existing

SIP.” Id. at 64,239. But EPA proposed to disapprove § 116.911(a)(2) because, it

said, “[t]he Texas PCP SP is not part of the Texas NSR SIP [and] EPA has

proposed to disapprove it on September 23, 2009.” Id. at 64,237.12

11 See Luminant I, 675 F.3d at 921 (citing 42 U.S.C. § 7410(k)(1)(B), (2),

and (3)). 12 Luminant Petitioners and others submitted comments to EPA on its

proposed disapproval. Among other things, Luminant Petitioners commented that “EPA’s disapproval of 30 TAC 116.617 does not justify or require disapproval of 116.911(a)(2)” and that “EPA has an independent obligation to justify its disapproval of the substance of those requirements in this [SB7] rulemaking and not simply rely on a prior one that did not involve the SB7 permit program.” 76 Fed. Reg. at 1529. EPA disagreed with this comment. Id.


12

On January 11, 2011, EPA finalized its proposal to approve the SB 7

Program but disapprove § 116.911(a)(2). 76 Fed. Reg. 1525 (Jan. 11, 2011). EPA

concluded that Texas’s SB 7 Program “contribute[s] to improvement in overall air

quality in Texas” and “meets the applicable requirements of the CAA [Clean Air

Act] and EPA air quality regulations, and is consistent with EPA policy.” Id. at

1529. However, EPA carved out and disapproved § 116.911(a)(2). EPA said it

was disapproving this provision because it had disapproved the Standard Permit for

PCPs in its related rulemaking. Id. at 1527. EPA explained:

EPA disapproved the new PCP Standard Permit submittal on September 15, 2010. 75 FR 56,424 (September 15, 2010). Thus, we are disapproving the submitted 116.911(a)(2) because it refers to and relies on the PCP SP that does not meet the applicable requirements of the Act[.]

Id. (emphasis added). The only “requirement[] of the Act” mentioned by EPA in

its final rule was the so-called “similar source” requirement, which, as discussed

below, EPA had relied on in disapproving the Standard Permit for PCPs.13 Id.

EPA’s final rule provided no other justification for its disapproval of

§ 116.911(a)(2).

13 As discussed below, this Court later rejected the “similar source”

requirement as a lawful basis for disapproval of the Standard Permit for PCPs. Luminant I, 675 F.3d at 927–30.


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III. EPA Disapproved Texas’s Standard Permit for PCPs at the Same Time It Proposed to Disapprove § 116.911(a)(2) Just prior to proposing action on the SB 7 Program, EPA took separate

action on Texas’s Standard Permit for PCPs (which § 116.911(a)(2) cross

references). Texas’s Standard Permit Program originated in 1993 when the Texas

Natural Resource Conservation Commission (“TNRCC”)14 proposed the program

as a revision to the Texas SIP. See 18 Tex. Reg. 8145 (Nov. 9, 1993). As

described by TCEQ, the new regulations “establish[] a new category of new source

review permits referred to as standard permits,” which “simplif[y] and accelerate[]

the permit review process[.]” Id. at 8145.15 One purpose of the Standard Permit

Program was to “streamline the agency review process, and allow more rapid

approval than would be possible under the generalized permit review process.” Id.

The program was finalized and adopted by the State in 1994, after being revised to

reflect input from EPA. See 19 Tex. Reg. 3055 (Apr. 22, 1994).

In general, a PCP is the installation of technology or equipment, or the use

of a technique, that reduces emissions. Under TCEQ’s rules, PCPs include “(A)

14 TNRCC later became the Texas Commission on Environmental Quality or

“TCEQ.” For the sake of convenience, this brief will use “TCEQ” throughout to refer to the State of Texas’s air permitting agency.

15 Generally speaking, “new source review” or “NSR” is the phrase used to refer to the process for obtaining authorization for the construction of new sources, or the modification of existing sources, that involve the emission of air pollutants. As discussed in detail in Luminant I, NSR can be either “major” or “minor,” depending on the amount of anticipated emissions. 675 F.3d at 922.


14

the installation or replacement of emissions control equipment; (B) the

implementation or change to control techniques; or (C) the substitution of

compounds used in manufacturing processes” “that reduce or maintain currently

authorized emission rates.” 30 Tex. Admin. Code § 116.617(a)(1), (2)(A)–(C).

PCPs reduce air pollutants of primary concern, such as SO2 and NOX. The type of

PCP that is used in a given situation is selected based on the pollutant to be

reduced. Examples of PCPs used to reduce emissions of SO2 include flue gas

desulfurization (“FGD”) systems, i.e., wet and dry “scrubbers.”16 For control of

NOX (an ozone precursor), control technologies include installation of low-NOX

burners,17 over-fire air systems,18 selective catalytic reduction (“SCR”), and

selective non-catalytic reduction (“SNCR”).19 Mercury (Hg) emissions may be

controlled by a process known as activated carbon injection (“ACI”).

16 Most FGD systems involve addition of a sorbent (like limestone) to

“scrub” SO2 out of the exhaust stream. 17 Rather than removing NOX, low-NOX burners are used to limit NOX

formation in the combustion process. This design regulates the mixing of the fuel with air, resulting in reduced oxygen, reduced flame temperature, and/or reduced residence time at peak temperature—conditions that limit NOX formation but may increase carbon monoxide emissions.

18 Often used with low-NOX burners, over-fire air systems divert a portion of the total combustion air from the burners. The goal is to delay the mixing of fuel with air, thus limiting NOX formation.

19 Although low-NOX burners and over-fire air systems are used during the combustion process, NOX can also be controlled by the installation of post-combustion technology, i.e., SCRs or SNCRs.


15

Texas submitted its regulations implementing the Standard Permit Program

and the Standard Permit for PCPs to EPA as revisions to its SIP in 1994 and

submitted various revisions in the years following. See 68 Fed. Reg. 40,865,

40,868 (July 9, 2003) (listing Texas’s submissions from 1994 to 2002). In 2003,

after almost ten years of taking no action, EPA approved Texas’s Standard Permit

Program. 68 Fed. Reg. 64,543 (Nov. 14, 2003). EPA found that Texas’s Standard

Permit Program was approvable because it (1) prohibited the use of Standard

Permits for Major sources or Major modifications; (2) required sources to meet all

applicable New Source Performance Standards (“NSPS”) and all National

Emission Standards for Hazardous Air Pollutants (“NESHAP”); (3) included all

required administrative procedures “which support the issuance and enforcement

of a Standard Permit”; and (4) required public notice and comment. Id. at 64,546–

47; see also 68 Fed. Reg. at 40,870 (proposed rule). However, at the time EPA

approved Texas’s Standard Permit Program, it did not approve the Standard Permit

for PCPs in § 116.617. EPA gave no reasons, but stated that it would review §

116.617 separately. 68 Fed. Reg. at 64,547.

In 2006, even though EPA had still not acted to approve or disapprove its

Standard Permit for PCPs, Texas revised and updated the permit. See 31 Tex. Reg.

515 (Jan. 27, 2006) (adopting a new 30 Tex. Admin. Code § 116.617). Texas took

this step in consideration of a court decision that vacated a federal regulatory


16

exemption for PCPs created by EPA regulations. Id. at 517 (citing New York v.

EPA, 413 F.3d 3 (D.C. Cir. 2005)). Specifically, Texas revised the Standard

Permit for PCPs in 2006 so that, prospectively, it would be limited to Minor NSR

permitting only20 and thus could not in any way run afoul of the D.C. Circuit’s

reasoning on the statutory definition of “modification” for Major NSR.21 30 Tex.

Reg. 6183, 6183 (Sept. 30, 2005) (“If the total [increased emissions] exceeds the

major modification threshold, then the modification is subject to federal NSR.”).

20 “Major” NSR applies to new sources with the potential to emit 100 or 250

tons per year (depending on the type of source) of one of a specified list of pollutants. “Major” NSR also applies to “major modifications,” i.e., changes at an existing facility that result in an increase in emissions over specified “significance” levels. Depending on the pollutant, these significance levels range from 100 tons per year (tpy) for carbon monoxide (CO), to 40 tpy for pollutants such as NOX and SO2, to 0.6 tpy for lead. 40 C.F.R. § 52.21(b)(23)(1). “Minor” NSR, in contrast, applies to new sources with the potential to emit less than 100 or 250 tons per year of the specified pollutants and to “minor modifications” of an existing facility, i.e., those changes that result in emissions increases below the specified significance levels.

21 In New York v. EPA, the D.C. Circuit reviewed an EPA rule creating a regulatory exemption for PCPs from Major NSR permitting. 413 F.3d at 40–42. Under the EPA rule, a facility that was modified in a way that resulted in an increase in emissions above Major NSR levels as part of a PCP was exempted from the statutory requirement to obtain a PSD permit, by excluding PCPs altogether from the statutory definition of “modification” found at 42 U.S.C. § 7411(a)(4). Id. at 40. The court held that EPA lacked authority to create PCP exemptions from the statutory requirements of Major NSR. Id. at 41. By contrast, Texas’s Standard Permit for PCPs as amended in 2006 does not apply to Major modifications and is otherwise substantially different from the federal PCP exemption vacated in New York v. EPA. Importantly, TCEQ’s Standard Permit for PCPs is not an exemption at all—it is a permit with requirements and emission limits.


17

TCEQ submitted its revised and more limited Standard Permit for PCPs to EPA on

February 1, 2006. 75 Fed. Reg. 56,424, 56,444 (Sept. 15, 2010).

Four years after Texas submitted its revised Standard Permit for PCPs to

EPA, and after more than fifteen years of sources in Texas utilizing the Standard

Permits for PCPs, EPA finally took action on it in 2010. Despite EPA’s prior

approval of Texas’s Standard Permit Program, under which the Standard Permit

for PCPs was promulgated, EPA disapproved the Standard Permit for PCPs in

September 2010. 75 Fed. Reg. 56,424 (Sept. 15, 2010) (final rule); 74 Fed. Reg.

48,467 (Sept. 23, 2009) (proposed rule).

EPA did not disapprove the Standard Permit for PCPs because it was

inconsistent with the Clean Air Act or federal regulations. Rather, its stated reason

for disapproval was that the Standard Permit for PCPs is inconsistent with other

Texas regulations—i.e., the Standard Permit Program regulations that EPA had

already approved. EPA did not base its disapproval on the federal statutory and

regulatory requirements for a Minor NSR program. Instead, EPA concluded that

the Standard Permit for PCPs “does not meet the requirements of the Texas Minor

NSR Standard Permits Program,” which EPA had approved in 2003, because EPA

concluded that it “does not apply to similar sources.” 75 Fed. Reg. at 56,447

(emphasis added). EPA claimed that, “[u]nder the Texas Standard Permits Minor

NSR SIP, an individual Standard Permit must be limited to new or existing similar


18

sources[.]” Id. at 56,444. EPA asserted that, “[b]ecause of the broad types of

source categories covered by the PCP Standard Permit, this Standard Permit lacks

replicable standardized permit conditions specifying how the Director’s discretion

is to be implemented for the individual determinations, e.g., the air quality

determination, the controls, and even the monitoring, recordkeeping, and

reporting.” Id. On this stated basis, EPA disapproved Texas’s Standard Permit for

PCPs, announcing its final decision in a Federal Register notice published

September 15, 2010—one month before EPA proposed to disapprove

§ 116.911(a)(2) of the SB 7 Program.

IV. The Present Case Was Held in Abeyance Pending This Court’s Review in Luminant I of EPA’s Disapproval of Texas’s Standard Permit for PCPs

Both EPA’s disapproval of Texas’s Standard Permit for PCPs (on September

15, 2010) and its disapproval of § 116.911(a)(2) of the SB 7 Program (on January

11, 2011) were challenged by way of multiple petitions for review filed with this

Court. Challenges by the State of Texas and Luminant Petitioners to the

disapproval of the Standard Permit for PCPs were consolidated in Case No. 10-

60891 (i.e., Luminant I). Challenges by these same petitioners to the disapproval

of § 116.911(a)(2) were consolidated in Case No. 11-60158.

Given the obvious connection between the two rulemakings and the fact that

“the Court’s decision in petition No. 10-60891 [Luminant I] may resolve all or


19

some of the issues” in No. 11-60158, EPA and the State of Texas jointly moved the

Court to stay the present case until a decision was issued by the Court in Luminant

I, No. 10-60891. See EPA’s and The State of Texas’ Unopposed Joint Motion to

Place This Case in Abeyance Pending Resolution of a Related Case at 3, No. 11-

60158 (May 4, 2011). In their motion, EPA and the State of Texas explained that

Case No. 10-60891 and Case No. 11-60158 “share certain common elements, such

that the Court’s resolution of the issues raised in petition No. 10-60891 may

resolve or narrow the issues that would otherwise require adjudication by the Court

in petition No. 11-60158.” Id. at 2. Indeed, EPA and Texas both acknowledged

expressly that the Court’s ultimate decision in Case No. 10-60891 could resolve

“all” of the issues in Case No. 11-60158. Id. at 3. The joint motion was granted

by the Court on May 9, 2011, holding this case in abeyance until after final

resolution of Case No. 10-60891.

V. In Luminant I, This Court Held Unlawful and Vacated EPA’s Disapproval of Texas’s Standard Permit for PCPs

With the present case held in abeyance, proceedings in Luminant I moved

forward, and on March 26, 2012, this Court issued its final decision in that case.

See Luminant Generation Co. v. EPA, 675 F.3d 917 (5th Cir. 2012). The Court

vacated and remanded EPA’s disapproval of Texas’s Standard Permit for PCPs.

Luminant I, 675 F.3d at 932–33. Given EPA’s lengthy delay in acting on Texas’s


20

original submission, the Court directed EPA to reconsider its decision, in light of

the guidance provided by the Court, “most expeditiously.” Id.

The Court rejected every justification EPA gave for its disapproval of the

Standard Permit for PCPs, concluding that EPA “failed to identify a single

provision of the [Clean Air] Act that Texas’s program violated, let alone explain its

reasons for reaching its conclusion.” Id. at 924. The Court rejected EPA’s

argument that Texas’s Standard Permit for PCPs was inconsistent with Texas law,

holding that “EPA may consider only the requirements of the CAA when

reviewing SIP submissions.” Id. at 926. The Court also rejected EPA’s argument

that Texas’s Standard Permit for PCPs was not sufficiently limited to “similar

sources.” Id. at 930 (“Because the so-called ‘similar source’ requirement is neither

necessary to safeguard the NAAQS nor warranted by any applicable provision of

the [Clean Air] Act, we must conclude that the EPA’s insistence upon it here was

unjustified.”). Finally, the Court rejected EPA’s argument that Texas’s standard

permit granted the director of TCEQ “too much discretion” or was otherwise

“unreplicable.” Id. at 931 (“The EPA had no legal basis to demand ‘replicable’

limitations on the Director’s discretion. Not once . . . has the EPA pointed to any

applicable provision of the [Clean Air] Act or its regulations that includes a

‘replicability’ standard.”). The Court remanded to EPA for expedited

reconsideration with the admonition that “[i]t is difficult to conceive, and the EPA


21

has not suggested, how it could disapprove the PCP Standard Permit under the

appropriate statutory factors.” Id. at 932 n.12.

On March 27, 2012—the day after the decision in Luminant I was issued—

the Clerk advised the parties that Case No. 11-60158 was removed from abeyance

and stated that a briefing schedule would issue upon receipt of the administrative

record. Letter of Advisement at 2 (Mar. 27, 2012). EPA did not seek rehearing of

this Court’s decision in Luminant I, and the mandate issued on May 18, 2012.


22

SUMMARY OF THE ARGUMENT

It is undisputed that Texas’s Standard Permit for PCPs, 30 Tex. Admin.

Code § 116.617(a)(1), facilitates the prompt installation of pollution control

devices and has led to substantial reductions in air pollution. The EPA can cite no

negative impacts to actual air quality nor any administrative problems caused by

the implementation of Texas’s Standard Permit for PCPs over many years.

A recent panel of this Court properly and powerfully rejected the grounds

for EPA’s disapproval of Texas’s Standard Permit for PCPs in Luminant I. This

Court unequivocally held unlawful EPA’s disapproval of Texas’s Standard Permit

for PCPs and vacated and remanded EPA’s action with instructions that EPA act

“most expeditiously” to reconsider it. 675 F.3d at 932–33. This Court left little

doubt as to the only lawful result on remand. Id. at 932 n.12 (“It is difficult to

conceive, and the EPA has not suggested, how it could disapprove the PCP

Standard Permit under the appropriate statutory factors.”)

This case is derivative of Luminant I. The provision at issue here, 30 Tex.

Admin. Code § 116.911 (a)(2), simply incorporated by reference the provisions of

Texas’s Standard Permit for PCPs into its program for “grandfathered” electric

generating facilities. There is no dispute that Texas’s grandfathered facilities

program has also led to enormous reductions in major pollutants. EPA

disapproved § 116.911(a)(2), however, because it incorporated by reference the


23

disapproved Standard Permit for PCPs. EPA offered no other rationale for its

disapproval of § 116.911(a)(2). 76 Fed. Reg. at 1527 (“EPA disapproved the new

PCP Standard Permit submittal on September 15, 2010. 75 FR 56,424 (September

15, 2010). Thus, we are disapproving the submitted 116.911(a)(2) because it refers

to and relies on the PCP SP . . . .”).

In light of Luminant I, which vacated and remanded EPA’s disapproval of

Texas’s Standard Permit for PCPs, the derivative disapproval of § 116.911(a)(2)

must be also be vacated. The same reasons that required vacatur in Luminant I

require it here. Indeed, EPA concedes that remand is warranted. But, the agency

stubbornly refuses to consent to vacatur, arguing instead that this Court should

retain jurisdiction over this case on a limited “remand of the record” for 90 days

without vacatur. EPA’s proposed remedy is unjustified and impractical. Both

vacatur and remand are warranted. Administrative and judicial efficiency, as well

as common sense, dictate that the related PCP provision here be vacated and

placed on the same expedited track as the remanded provision. Luminant

Petitioners request that the Court here order EPA to consider them on the same

expedited schedule.


24

STANDARD OF REVIEW

Under the Administrative Procedure Act (“APA”), final agency action must

be set aside if it is “arbitrary and capricious, an abuse of discretion, or otherwise

not in accordance with law,” or if it exceeds the agency’s statutory authority. 5

U.S.C. § 706(2).22 An agency’s action is arbitrary and capricious if “the agency

has relied on factors which Congress has not intended it to consider, entirely failed

to consider an important aspect of the problem, offered an explanation for its

decision that runs counter to the evidence before the agency, or is so implausible

that it could not be ascribed to a difference in view or the product of agency

expertise.” La. Envtl. Action Network v. EPA, 382 F.3d 575, 582 (5th Cir. 2004)

(citations omitted).

At a minimum, the agency must “examine[] the relevant data and articulate[]

a satisfactory explanation for its action including a rational connection between the

facts found and the choice made.” BCCA Appeal Group, 355 F.3d at 824 (internal

quotation omitted). The agency’s action must satisfy these standards based only on

the administrative record before the agency at the time of its decision and only on

the agency’s stated rationale at that time. See Camp v. Pitts, 411 U.S. 138, 142–43

(1973) (“The focal point for judicial review should be the administrative record

22 The standard of review for EPA’s action under the Clean Air Act here is the standard of review found in the APA. Texas v. EPA, 499 F.2d 289, 296 (5th Cir. 1974); Allied Local & Reg’l Mfrs. Caucus v. EPA, 215 F.3d 61, 68 (D.C. Cir. 2000).


25

already in existence, not some new record made initially in the reviewing court.”);

see also Luminant I, 675 F.3d at 925 (citing Burlington Truck Lines, Inc. v. United

States, 371 U.S. 156, 168–69 (1962)) (holding that agency action is reviewed

“solely on the basis of the agency’s stated rationale at the time of its decision.”);

Geyen v. Marsh, 775 F.2d 1303, 1309 (5th Cir. 1985) (citing Fla. Power & Light

Co. v. Lorion, 470 U.S. 729 (1982)) (“Review of agency action under § 706(2)’s

‘arbitrary or capricious’ standard is limited to the record before the agency at the

time of its decision.”); Baylor Univ. Med. Ctr., 758 F.2d at 1060 (internal quotation

omitted) (“An agency’s action must be upheld, if at all, on the basis articulated by

the agency at the time of the rule making.”).

ARGUMENT

I. Luminant I Is Dispositive of This Case and Requires Partial Vacatur and Remand of the Final Rule

Luminant I requires vacatur of EPA’s Final Rule23 and remand with

instructions to the agency to reconsider as part of the on-going expedited remand

proceedings ordered in Luminant I. In Luminant I, this Court held unlawful EPA’s

disapproval of Texas’s Standard Permit for PCPs and vacated and remanded with

instructions that EPA act “most expeditiously” to reconsider Texas’s PCP

23 Petitioners request only that the Court vacate that part of the Final Rule that disapproves 30 Tex. Admin. Code § 116.911(a)(2). No party to this proceeding is challenging EPA’s approval of the remainder of Texas’s SB 7 program regulations, and thus EPA’s approval of those provisions (which is also contained in the Final Rule) should not be vacated.


26

regulations. 675 F.3d at 932–33 (emphasis added). The same result is necessary in

this closely related case.

The sole basis for EPA’s Final Rule here is its prior disapproval of the

Standard Permit for PCPs, 76 Fed. Reg. at 1527, which this Court held unlawful in

Luminant I. 675 F.3d at 929–33.

This Court adheres assiduously to the prior panel rule. See Burge, 187 F.3d

at 466 (“It is a firm rule of this circuit that in the absence of an intervening contrary

or superseding decision by this court sitting en banc or by the United States

Supreme Court, a panel cannot overrule a prior panel’s decision.”); Macktal v. U.S.

Dep’t of Labor, 171 F.3d 323, 328 (5th Cir. 1999) (“This court adheres strictly to

the maxim that one panel of the court cannot overturn another, even if it disagrees

with the prior panel’s holding.”). EPA did not seek en banc or Supreme Court

review of the decision in Luminant I, and thus the decision is the law of the Circuit.

Further, courts appropriately vacate and remand decisions on review where,

as here, intervening rulings or changes in law nullify the underlying justification of

the order or rule under review. E.g., Simpson v. Sperry Rand Corp., 488 F.2d 450,

451 (5th Cir. 1973) (per curiam); Baker v. Richardson, 462 F.2d 81, 82 (5th Cir.

1972) (per curiam); Clean Air Implementation Project v. EPA, No. 96-1224, 1996

WL 393118 (D.C. Cir. June 28, 1996) (per curiam); Cunningham v. Belleque, 151

F. App’x 511, 512 (9th Cir. 2005); see also Hernandez-Rodriguez v. Pasquarell,


27

118 F.3d 1034, 1042 (5th Cir. 1997) (“[U]nquestionably the judiciary must

generally apply changes in the law to cases pending on appeal[.]”). That is the

case here—after EPA disapproved § 116.911(a)(2), the Court issued its decision in

Luminant I, nullifying the only stated basis for EPA’s decision.

On its face, EPA’s disapproval of § 116.911(a)(2) is no longer defensible in

light of Luminant I. EPA’s disapproval of § 116.911(a)(2) relies completely on

EPA’s related disapproval of Texas’s Standard Permit for PCPs. 76 Fed. Reg. at

1527 (“EPA disapproved the new PCP Standard Permit submittal on September

15, 2010. 75 FR 56,424 (September 15, 2010). Thus, we are disapproving the

submitted 116.911(a)(2) because it refers to and relies on the PCP SP . . . .”).

EPA’s prior disapproval was vacated and remanded by this Court in an

unambiguous ruling rejecting each of EPA’s proffered justifications for its

disapproval. Luminant I, 675 F.3d at 932–33 (agreeing with all three of

Petitioners’ main arguments as to why EPA’s disapproval was unlawful).

Nor can EPA now rely on new grounds to justify its disapproval of

§ 116.911(a)(2). See Camp, 411 U.S. at 142–43 (“The focal point for judicial

review should be the administrative record already in existence, not some new

record made initially in the reviewing court.”); Baylor Univ. Med. Ctr., 758 F.2d at

1060 (internal quotation omitted) (“An agency’s action must be upheld, if at all, on

the basis articulated by the agency at the time of the rule making.”).


28

There can be no credible argument that the relevant part of EPA’s Final Rule

here must not also be vacated and remanded for reconsideration by EPA for the

reasons stated in Luminant I. Indeed, EPA’s disapproval of § 116.911(a)(2)

specifically referenced one of its failed arguments from its Final Rule disapproving

the Standard Permit for PCPs. EPA noted that it believed Texas’s Standard Permit

for PCPs “did not meet the applicable requirements of the Act,” because TCEQ

had “failed to demonstrate how this particular Standard Permit met the Texas

Standard Permits NSR SIP since it applies to numerous types of pollution control

projects, which can be used at any source that want to use a PCP, and is not an

authorization for similar sources.” 76 Fed. Reg. at 1528. This “similar source”

argument was expressly rejected by this Court. See Luminant I, 675 F.3d at 930

(“Because the so-called ‘similar source’ requirement is neither necessary to

safeguard the NAAQS nor warranted by any applicable provision of the Act, we

must conclude that the EPA’s insistence upon it here was unjustified.”).

EPA has already acknowledged the close connection between this case and

Luminant I. In moving for a stay at the outset of this case, EPA represented to this

Court that an intervening ruling on EPA’s disapproval of Texas’s Standard Permit

for PCPs could resolve all of the issues in this case. EPA and the State of Texas’s

Unopposed Joint Motion at 3, Luminant Gen. v. EPA, No. 11-60158 (May 4, 2011)

(“[T]he Court’s decision in petition No. 10-60891 may resolve all or some of the


29

issues, or otherwise narrow such issues in petition No. 11-60158 and therefore

potentially eliminate or narrow the need for briefing by the parties and adjudication

by the Court in that petition.”). This Court’s March 26, 2012 rejection of EPA’s

position on Texas’s Standard Permit for PCPs was definitive. Plainly, that opinion

resolved all the issues before the Court in this case.

Moreover, vacatur—and not just remand—of EPA’s Final Rule

disapproving § 116.911(a)(2) is warranted. In Luminant I, the Court vacated and

remanded EPA’s disapproval of the very PCP provision at issue in this case. 675

F.3d at 932–33. Given that EPA relied on its earlier disapproval for its decision

here and expressed no other basis for disapproval, vacatur is again appropriate.

In determining whether vacatur or remand without vacatur is appropriate,

courts consider, among other matters, “the seriousness of the order’s deficiencies

(and thus the extent of doubt whether the agency chose correctly)[.]” Allied-

Signal, Inc. v. U.S. Nuclear Regulatory Comm’n, 988 F.2d 146, 150–51 (D.C. Cir.

1993) (internal citations omitted). Here, this Court has already stated that “[i]t is

difficult to conceive, and the EPA has not suggested, how it could disapprove the

PCP Standard Permit under the appropriate statutory factors.” Luminant I, 675

F.3d at 932 n.12.24 Furthermore, there are no potential “disruptive consequences”

24 Under the statute, EPA must approve a SIP revision unless it would

interfere with the NAAQS or violate another requirement of the statute. 42 U.S.C. § 7410(l); Luminant I, 675 F.3d at 928. Here, there is no question that the revision


30

of vacatur in this case, Allied-Signal, 988 F.2d at 150–51, and EPA has not claimed

any.

Finally, pursuant to the Court’s instructions in Luminant I, EPA is currently

conducting expedited reconsideration proceedings during which it must

“reconsider these regulations and approve or disapprove them most expeditiously.”

Id. at 933. Administrative and judicial efficiency, as well as common sense,

dictate that the related PCP provision here be vacated and placed on the same

expedited track as the remanded provision, and Luminant Petitioners request that

the Court here order EPA to consider them on the same expedited schedule.25 Cf.

Natural Res. Def. Council v. EPA, 489 F.3d 1250, 1264 (D.C. Cir. 2007)

(Randolph, J., concurring) (“A remand-only disposition is, in effect, an indefinite

is protective of the NAAQS. Luminant I, 675 F.3d at 929. Nor, in the more than decade long administrative process in which this rule was considered, has EPA identified any other provision of the statute that the Standard Permit for PCPs would violate. Id. at 924, 932.

25 In Luminant I, the Court did not specify a deadline for EPA to complete its reconsideration and either approve or disapprove the Texas regulations using the proper statutory factors. 675 F.3d at 932–33. Given that the statutory deadline for EPA’s original action on the revisions was 18 months and EPA has already violated that deadline by waiting “more than three years after the statutory deadline to act,” Petitioners submit that a reasonable time period for EPA to take final action on remand to approve or disapprove the regulations under the proper factors would be 3 to 6 months from issuance of this Court’s mandate on May 18, 2012. Id. at 921, 932. EPA’s review is narrowly cabined and should not require protracted remand proceedings, given this Court’s instruction that “EPA must limit its review of Texas’s regulations to ensuring that they meet the minimal CAA requirements that govern SIP revisions to minor NSR[.]” Id. at 932. EPA’s reconsideration of § 116.911(a)(2) should take place on the same schedule.


31

stay of the effectiveness of the court’s decision and agencies naturally treat it as

such.”).

CONCLUSION

For these reasons and those stated in Luminant I, the Court should vacate

EPA’s disapproval of § 116.911(a)(2) and remand with instructions to the agency

to reconsider as part of the ongoing expedited remand proceedings ordered in

Luminant I.

Respectfully submitted,


Counsel for Luminant:

P. Stephen Gidiere III Thomas L. Casey III Balch & Bingham LLP 1901 Sixth Ave. N., Ste. 1500 Birmingham, Alabama 35203 205-251-8100

Harry M. Reasoner Vinson & Elkins LLP 1001 Fannin St., Ste. 2500 Houston, Texas 77002 713-758-2358

Eric A. White Vinson & Elkins LLP 2200 Pennsylvania Ave. NW, Ste. 500 West Washington, DC 20037 202-639-6500

Stacey H. Doré General Counsel Energy Future Holdings Corp. 1601 Bryan Street, 41st Floor Dallas, Texas 75201

Stephanie Zapata Moore General Counsel Luminant Generation Company LLC 1601 Bryan Street, 22nd Floor Dallas, Texas 75201


32

CERTIFICATE OF SERVICE

I hereby certify that all counsel of record who have consented to electronic service are being served with a copy of this document via the Court’s CM/ECF system on this 23rd day of July, 2012. Any other counsel of record will be served by first class U.S. mail on this same day.



33

CERTIFICATE OF COMPLIANCE

This brief complies with the type-volume limitation of Fed. R. App. P. 32(a)(7)(B) because it contains 7,384 words, excluding the parts of the brief exempted by Fed. R. App. P. 32(a)(7)(B)(iii). This brief complies with typeface requirements of Fed. R. App. P. 32(a)(5) and the type style requirements of Fed. R. App. P. 32(a)(6) because it has been prepared in a proportionally spaced typeface using Microsoft Word 2010 in Times New Roman 14-point font.

July 23, 2012 /s/ P. Stephen Gidiere III Counsel for Luminant Petitioners


34

ADDENDUM OF STATUTES, RULES, AND REGULATIONS TO PRINCIPAL BRIEF OF PETITIONERS

LUMINANT GENERATION CO. LLC, ET AL. For the Court’s ease of reference, this Addendum reproduces the following regulatory materials:

• Federal Register notices o 75 Fed. Reg. 64,235 (Oct. 19, 2010) ............................................ Add. 1 o 76 Fed. Reg. 1525 (Jan. 11, 2011) ............................................... Add. 8

• Texas Register notices o 18 Tex. Reg. 8145 (Nov. 9, 1993) .............................................. Add. 16 o 19 Tex. Reg. 3055 (Apr. 22, 1994) ............................................ Add. 22 o 30 Tex. Reg. 6183 (Sept. 30, 2005) ........................................... Add. 33 o 31 Tex. Reg. 515 (Jan. 27, 2006) ............................................... Add. 58

• Texas Administrative Code Provisions o 30 Tex. Admin. Code § 116.617 ................................................ Add. 79 o 30 Tex. Admin. Code § 116.911 ................................................ Add. 83

• Texas Utilities Code Provision o Tex. Util. Code § 39.264 ............................................................ Add. 85


64235 Federal Register / Vol. 75, No. 201 / Tuesday, October 19, 2010 / Proposed Rules

based on a 6 hour average. Particulate testing shall be performed annually as required by paragraph (e)(3) of this section. This test with 2 hour test runs may be substituted and used to demonstrate compliance with the particulate limits in paragraph (d)(2) of this section.

(2) Particulate Matter from units 4 and 5 shall be limited to 0.015 lb/MMbtu for each unit as measured by the average of 3 test runs with each run collecting a minimum of 60 dscf of sample gas and with a duration of at least 120 minutes. Sampling shall be performed according to 40 CFR Part 60 Appendices A–1 through A–3, Methods 1 through 4 and Method 5 or Method 5e. The averaging time for any other demonstration of the particulate matter compliance or exceedence shall be based on a 6 hour average.

(3) No owner or operator shall discharge or cause the discharge of emissions from the stacks of Units 1, 2, 3, 4 or 5 into the atmosphere exhibiting greater than 10% opacity, excluding uncombined water droplets, averaged over any six (6) minute period.

(4) Plantwide nitrogen oxide emission limits.

(i) The plantwide nitrogen oxide limit, expressed as nitrogen dioxide, shall be 0.11 lb/MMbtu as averaged over a rolling 30 calendar day period. NO2 emissions for each calendar day shall be determined by summing the hourly emissions measured in pounds of NO2 for all operating units. Heat input for each calendar day shall be determined by adding together all hourly heat inputs, in millions of BTU, for all operating units. Each day the thirty day rolling average shall be determined by adding together that day and the preceding 29 days pounds of NO2 and dividing that total pounds of NO2 by the sum of the heat input during the same 30 day period. The results shall be the 30 day rolling pound per million BTU emissions of NOX.

(ii) The interim NOX limit for each individual boiler with SCR control shall be as follows:

(A) Unit 1 shall meet a rolling 30 calendar day NOX limit of 0.21 lb/ MMBtu,

(B) Unit 2 shall meet a rolling 30 calendar day limit of 0.17 lb/MMBtu,

(C) Unit 3 shall meet a rolling 30 calendar day limit of 0.16 lb/MMBtu,

(D) Units 4 and 5 shall meet a rolling 30 calendar day limit of 0.11 lb/MMBtu, each.

(iii) Testing and monitoring shall use the 40 CFR part 75 monitors and meet the 40 CFR part 75 quality assurance requirements. In addition to these 40 CFR part 75 requirements, relative

accuracy test audits shall be performed for both the NO2 pounds per hour measurement and the heat input measurement. These shall have relative accuracies of less than 20%. This testing shall be evaluated each time the 40 CFR part 75 monitors undergo relative accuracy testing.

(iv) If a valid NOX pounds per hour or heat input is not available for any hour for a unit, that heat input and NOX pounds per hour shall not be used in the calculation of the 30 day plant wide rolling average.

(v) Upon the effective date of the plantwide NOX average, the owner or operator shall have installed CEMS and COMS software that complies with the requirements of this section.

(j) Dust. Each owner or operator shall operate and maintain the existing dust suppression methods for controlling dust from the coal handling and ash handling and storage facilities. Within ninety (90) days after promulgation of this paragraph (j), the owner or operator shall develop a dust control plan and submit the plan to the Regional Administrator. The owner or operator shall comply with the plan once the plan is submitted to the Regional Administrator. The owner or operator shall amend the plan as requested or needed. The plan shall include a description of the dust suppression methods for controlling dust from the coal handling and storage facilities, ash handling, storage and landfilling, and road sweeping activities. Within 18 months of promulgation of this paragraph (j) each owner or operator shall not emit dust with opacity greater than 20 percent from any crusher, grinding mill, screening operation, belt conveyor, or truck loading or unloading operation. [FR Doc. 2010–26262 Filed 10–18–10; 8:45 am]

BILLING CODE 6560–50–P

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA–R06–OAR–2005–TX–0031; FRL–9215– 1]

Approval and Promulgation of Air Quality Implementation Plans; Texas; Revisions to Rules and Regulations for Control of Air Pollution; Permitting of Grandfathered and Electing Electric Generating Facilities

AGENCY: Environmental Protection Agency (EPA). ACTION: Proposed rule.

SUMMARY: The EPA is proposing to partially approve and partially disapprove revisions of the Texas State Implementation Plan (SIP) submitted by the Texas Commission on Environmental Quality (TCEQ, or Commission) on January 3, 2000, and July 31, 2002, as supplemented on August 5, 2009. These revisions are to regulations of the TCEQ which relate to application and permitting procedures for grandfathered electric generating facilities (EGFs). The revisions address a mandate by the Texas Legislature under Senate Bill 7 to achieve nitrogen oxide (NOX), sulfur dioxide (SO2) and particulate matter (PM) emission reductions from grandfathered EGFs. These emissions reductions will contribute to achieving attainment and help ensure attainment and continued maintenance of the National Ambient Air Quality Standards (NAAQS) for ozone, sulfur dioxide, and particulate matter in the State of Texas. As a result of these mandated emissions reductions, in accordance with section 110(l) of the Federal Clean Air Act, as amended (the Act, or CAA), partial approval of these revisions will not interfere with attainment of the NAAQS, reasonable further progress, or any other applicable requirement of the Act. EPA is proposing that the revisions, but for a severable provision, meet section 110, part C, and part D of the Federal Clean Air Act (the Act or CAA) and EPA’s regulations. Therefore, EPA is proposing to approve the revisions but for a severable portion that allows collateral emissions increases of carbon monoxide (CO) created by the imposition of technology controls to be permitted under the State’s Standard Permit (SP) for Pollution Control Projects (PCP). EPA is proposing to disapprove this severable portion concerning the issuance of a PCP SP for the CO collateral emissions increases. EPA is taking comments on this proposal and plans to follow with a final action. DATES: Written comments must be received on or before November 18, 2010.

ADDRESSES: Submit your comments, identified by Docket No. R06–OAR– 2005–TX–0031, by one of the following methods:

• Federal eRulemaking Portal: http:// www.regulations.gov.

• Follow the on-line instructions for submitting comments.

• U.S. EPA Region 6 ‘‘Contact Us’’ Web site: http://epa.gov/region6/ r6comment.htm. Please click on ‘‘6PD (Multimedia)’’ and select ‘‘Air’’ before submitting comments.

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• E-mail: Mr. Rick Barrett at: [email protected]. Please also send a copy by e-mail to the person listed in the FOR FURTHER INFORMATION CONTACT section below.

• Fax: Mr. Rick Barrett, Air Permits Section (6PD–R), at fax number 214– 665–7263.

• Mail: Mr. Rick Barrett, Air Permits Section (6PD–R), Environmental Protection Agency, 1445 Ross Avenue, Suite 1200, Dallas, Texas 75202–2733.

• Hand or Courier Delivery: Mr. Rick Barrett, Air Permits Section (6PD–R), Environmental Protection Agency, 1445 Ross Avenue, Suite 1200, Dallas, Texas 75202–2733. Such deliveries are accepted only between the hours of 8 a.m. and 4 p.m. weekdays except for legal holidays. Special arrangements should be made for deliveries of boxed information.

Instructions: Direct your comments to Docket No. EPA–R06–OAR–2005–TX– 0031. EPA’s policy is that all comments received will be included in the public docket without change and may be made available online at http:// www.regulations.gov, including any personal information provided, unless the comment includes information claimed to be Confidential Business Information (CBI) or other information the disclosure of which is restricted by statute. Do not submit information through http://www.regulations.gov or e-mail that you consider to be CBI or otherwise protected from disclosure. The http://www.regulations.gov Web site is an ‘‘anonymous access’’ system, which means EPA will not know your identity or contact information unless you provide it in the body of your comment. If you send an e-mail comment directly to EPA without going through http://www.regulations.gov, your e-mail address will be automatically captured and included as part of the comment that is placed in the public docket and made available on the Internet. If you submit an electronic comment, EPA recommends that you include your name and other contact information in the body of your comment and with any disk or CD–ROM you submit. If EPA cannot read your comment due to technical difficulties and cannot contact you for clarification, EPA may not be able to consider your comment. Electronic files should avoid the use of special characters, any form of encryption, and be free of any defects or viruses.

Docket: All documents in the docket are listed in the http:// www.regulations.gov index. Although listed in the index, some information is not publicly available, e.g., CBI or other information whose disclosure is

restricted by statute. Certain other material, such as copyrighted material, will be publicly available only in hard copy. Publicly available docket materials are available either electronically in http:// www.regulations.gov or in hard copy at the Air Permits Section (6PD–R), Environmental Protection Agency, 1445 Ross Avenue, Suite 700, Dallas, Texas 75202–2733. The file will be made available by appointment for public inspection in the Region 6 FOIA Review Room between the hours of 8:30 a.m. and 4:30 p.m. weekdays except for legal holidays. Contact the person listed in the FOR FURTHER INFORMATION CONTACT paragraph below or Mr. Bill Deese at 214–665–7253 to make an appointment. If possible, please make the appointment at least two working days in advance of your visit. There will be a 15 cent per page fee for making photocopies of documents. On the day of the visit, please check in at the EPA Region 6 reception area at 1445 Ross Avenue, Suite 700, Dallas, Texas.

The State submittal is also available for public inspection at the State Air Agency listedbelow during official business hours by appointment: Texas Commission on Environmental Quality, Office of Air Quality, 12124 Park 35 Circle, Austin, Texas 78753. FOR FURTHER INFORMATION CONTACT: Mr. Rick Barrett, Air Permits Section (6PD– R), Environmental Protection Agency, Region 6, 1445 Ross Avenue, Suite 700, Dallas, Texas 75202–2733, telephone 214–665–7227; fax number 214–665– 7263; e-mail address: [email protected].

SUPPLEMENTARY INFORMATION: Throughout this document ‘‘we,’’ ‘‘our,’’ and ‘‘us’’ refers to EPA.

Outline

I. Texas Senate Bill 7 II. What action is EPA proposing?

A. January 3, 2000 Submittal B. July 31, 2002 Submittal

III. Why are we proposing to partially approve and partially disapprove this SIP submittal? A. January 3, 2000 Submittal B. July 31, 2002 Submittal C. CAA 110(l) Analysis

IV. Proposed Action V. Statutory and Executive Order Reviews

I. Texas Senate Bill 7

Texas Senate Bill 7 (SB 7), formed under the 76th Texas State Legislature, 1999, amended the Texas Utilities Code (TUC), Title 2, Public Utility Regulatory Act, Subtitle B, Electric Utilities, and created a new Texas Utilities Code Chapter 39, ‘‘Restructuring of Electric Utility Industry.’’ SB 7 requires the

TCEQ to establish a regulatory program implementing the statute’s mandatory emissions reductions for ‘‘grandfathered facilities’’ under the Texas Utilities Code section 39.264. A ‘‘grandfathered facility’’ is one that existed at the time the Legislature amended the Texas Clean Air Act (TCAA) in 1971.

These facilities were not required to comply with (i.e., grandfathered from) the then new requirement to obtain permits for construction or modifications of facilities that emit air contaminants. Texas began permitting new and modified sources in 1971, and sources built before Texas’ permitting rules became effective were not required to obtain permits for air emissions as long as they were not modified as defined under Texas’ New Source Review SIP program.

Section 39.264 of the TUC now requires EGFs that existed on January 1, 1999, to obtain a permit from the Commission even though these sources were not previously required to obtain a permit under the TCAA, section 382.0518(g).

Section 39.264 of the TUC specifically requires owners or operators of grandfathered EGFs to apply for a permit to emit nitrogen oxides (NOX) and, for coal-fired grandfathered EGFs, sulfur dioxide (SO2) and particulate matter (PM) through opacity limitations. These applications were due on or before September 1, 2000. A grandfathered EGF that does not obtain a permit may not operate after May 1, 2003, unless the Commission finds good cause for an extension. Section 39.264 of the TUC requires that for the 12- month period beginning May 1, 2003, and for each 12-month period following, annual emissions of NOX from grandfathered EGFs not exceed 50% of the NOX emissions reported to the Commission for 1997. Furthermore, it requires that emissions of SO2 from coal-fired grandfathered EGFs not exceed 75% of the SO2 emissions reported to the Commission in 1997. In addition, TUC section 39.264(e) requires electric generating facility permits (EGFPs) for coal-fired, grandfathered EGFs to contain appropriate opacity limitations provided by the commission’s rules in 30 Texas Administrative Code (TAC) Ch.111.111, ‘‘Requirements for Specified Sources.’’ As described in more detail below, the emission limitations may be satisfied by using control technology or by participating in the banking and trading of allowances under Texas’ Emission Banking and Trading of Allowances (EBTA) program.

Overall, SB 7 mandates specific pollution reduction in an area, while


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1 TCEQ does not interpret ‘‘new control methods’’ to include the use of combustion techniques. Consequently, no PCP SP is required. Also, if a grandfathered facility chooses to impose add-on controls, this does not fall under the PCP SP requirement either. As a result, a PCP SP is required only for collateral emissions of CO.

allowing individual sources flexibility in how they meet emissions reductions. As participants in the program, EGFs must obtain a permit allocating them a certain level of emissions which they cannot exceed. In each defined region, the total level of emissions is restricted, or capped, to a level consistent with the SB 7 statutory goals. The individual EGF, to meet its allocated emissions level, can either choose to install pollution controls, shut down operations, or purchase allowances from another source that already reduced emission levels below its permitted amount.

To achieve SB 7’s mandate, the TCEQ made revisions to 30 TAC Ch.116, ‘‘Control of Air Pollution by Permits for New Construction or Modification,’’ by establishing an allowance and permitting program for regulating grandfathered EGFs under Subchapter I. TCEQ concurrently adopted Chapter 101, Subchapter H, ‘‘Emissions Banking and Trading,’’ that establishes a regional cap and trade system to distribute emission allowances for use by EGFs. The new Division 2, Chapter 101, Subchapter H, concerning EBTA, sets out the allowance system to be used to assist grandfathered and electing EGFs in meeting the emission reduction requirements of TUC, section 39.264. Together, the two rules define categories of EGFs that are eligible to use the trading system. As discussed above, the first category consists of grandfathered facilities. The second category of EGFs consist of currently permitted EGFs that are not subject to the permitting requirements mandated by SB 7, yet elect to participate in the allowance trading system. These are referred to as ‘‘electing’’ EGFs and participation in the permitting program will allow electing EGFs to obtain allowances under the EBTA.

The purpose of the proposed rulemaking by EPA is to partially approve and partially disapprove the TCEQ’s permit and emission control requirements for grandfathered and electing EGFs and related permit application, monitoring, reporting and public notice procedures. Specifically, the permit application requirements, methods for monitoring and reporting emissions and public notice procedures for grandfathered and electing EGFs are the subject of this proposal action. Please note that EPA’s action on 30 TAC Chapter 101, Subchapter H, Division 2, concerning Emissions Banking and Trading of Allowances, is being proposed in a separate notice and is evaluated in a separate TSD. (RME Docket R06–OAR–2005–TX–0012).

The revisions to TCEQ’s 30 TAC, Chapter 116, concerning the permitting of grandfathered EGFs, will achieve the Legislature’s SB 7 emissions reductions goals. Compliance with these revisions will cause decreased air emissions of NOX, SO2, and PM, due to the shutdown of the source, participation in the EBTA, or installation of pollution controls on grandfathered sources that had previously been exempt from having to use pollution controls. Because the revisions will cause additional emission reductions from these sources, they will better serve to protect the public health and welfare. The revisions will also continue to contribute to improvement of air quality and attainment or maintenance of the federal air quality standards. Overall, these provisions serve to improve the existing SIP.

Lastly, these provisions meet the requirement in 40 CFR 51.160(a) that each plan include legally enforceable procedures to determine whether the construction or modification of a facility, building, structure, or installation, or combination of these will result in (1) A violation of applicable portions of the control strategy; or (2) interference with attainment or maintenance of a national standard in the State in which the proposed source (or modification) is located or in a neighboring State.

II. What action is EPA proposing? We are proposing to partially approve

and partially disapprove the revision to Title 30, Chapter 116, of the TAC submitted by the State of Texas on January 3, 2000. We are also proposing to fully approve the revision to Title 30, Chapter 116, of the TAC submitted by the State of Texas on July 31, 2002. The January 3, 2000 submittal concerns Subchapter A: ‘‘Definitions,’’ section 116.18; and Subchapter I: ‘‘Electric Generating Facility Permits,’’ sections 116.910–914, 116.916, 116.920–922, 116.930, and 116.931. We are proposing to fully approve all of this 2000 submittal but for the severable reference in 30 TAC 116.911(a)(2) that, if approved, would allow the use of a Texas PCP SP for the permitting of the CO collateral emissions increases. We are proposing to disapprove this reference in submitted 30 TAC 116.911(a)(2) allowing the use of a PCP SP for the collateral CO emissions. The July 31, 2002 submittal concerns Subchapter A: ‘‘Definitions,’’ sections 116.10 and 116.18; and Subchapter I: ‘‘Electric Generating Facility Permits,’’ sections 116.910, 116.911, 116.913, 116.917, 116.918, 116.921, 116.926, 116.928, and 116.930. The TCEQ adopted these revisions on December

16, 1999, and May 22, 2002, respectively.

Please note that in the July 31, 2002 submittal concerning Subchapter A: ‘‘Definitions,’’ section 116.10 is severable and previously acted on as approvable in a separate rulemaking (see explanation below).

EPA intends to take final action on the submitted SB 7 SIP by December 31, 2010, as provided in the Consent Decree entered on January 21, 2010 in BCCA Appeal Group v. EPA, Case No. 3:08– cv–01491–N (N.D. Tex).

A. January 3, 2000 Submittal In the January 3, 2000 submittal,

TCEQ submitted new rules to Chapter 116, including Subchapter A: ‘‘Definitions,’’ delineating certain definitions of words and terms used in Subchapter I; and Subchapter I: ‘‘Electric Generating Facility Permits,’’ implementing the applicability requirements for grandfathered and electing electric generating facilities. Representative sections of Subchapter I include: 116.911, Electric Generating Facility Permit Application; 116.913, General and Special Conditions; 116.914, Emissions Monitoring and Reporting Requirements; and 116.921, Notice and Comment Hearings for Initial Issuance.

In 116.911, owners or operators of grandfathered or electing EGFs shall submit an application to TCEQ to authorize nitrogen oxides (NOX) emissions and, if applicable, sulfur dioxide (SO2) and particulate matter (PM) emissions before September 11, 2000. The section requires the application to specify various requirements under 116.911(a)(1)–(4), (b)(1)–(2), (c)–(d). Section 116.911 contains one subsection, 116.911(a)(2), ‘‘Control method,’’ which references section 116.617, Standard Permits for Pollution Control Projects (PCPs). Under 116.911(a)(2), if an EGF permit applicant proposes the use of new control methods 1 in its initial application, then compliance with particular subsections in 116.617 is required and TCEQ may require air dispersion modeling or ambient monitoring. The Texas PCP SP is not part of the Texas NSR SIP. Moreover, EPA has proposed to disapprove it on September 23, 2009. See 74 FR 48467. Final action was signed on August 31, 2010, under the BCCA consent decree.


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Furthermore, the DC Circuit Court of Appeals issued a court decision, New York v. EPA, No. 02–1387 (June 24, 2005) that addressed the use of PCPs and disapproved their use for Major NSR requirements. In that decision, the court vacated the provisions of the 2002 NSR Reform rule that specifically related to Clean Units and Pollution Control Projects.

In response to the court’s decision, EPA filed a Petition for Rehearing or Rehearing En Banc and Request for Clarification on August 8, 2005. In that Petition, EPA requested clarification that the court’s ruling on PCP’s applies only prospectively. On December 9, 2005, the DC Circuit ordered that ‘‘EPA’s request for clarification as to any retroactive effect of the ruling on Pollution Control Projects be denied.’’ The court also stated that because there was no specific retroactive application of this provision before the court, it was premature to rule on this request. Based on TCEQ’s Technical Supplement, EPA believes that any collateral emissions increases due to controls installed to limit NOX, SO2 or PM under the submitted 30 TAC 911(a)(2) are above the significance level for Prevention of Significant Deterioration (PSD) review for CO collateral emissions increases only, and that these collateral CO increases are located at only two PCP SP permitted plants. Therefore, in only two instances were there collateral CO emissions increases that obtained a Texas PCP SP rather than a Major NSR SIP permit. They obtained their PCP SP before the court decision was issued. Furthermore, based upon the Technical Supplement, EPA believes that all of the resultant collateral CO increases across the State of Texas (including those from the two plants) do not interfere with attainment or maintenance of the NAAQS for CO, et al., nor cause or contribute to increase in PSD increments, much less a violation of any NAAQS. Nevertheless, based on the above court decision and the PCP SP not being part of the Texas NSR SIP, the submitted subsection 116.911(a)(2) is not approvable, and therefore we are proposing to disapprove this submitted subsection for collateral increases of CO emissions. Note that the entire State of Texas is currently in attainment for CO.

Section 116.913 contains general conditions applicable to every EGF permit, and allows the TCEQ to include special conditions in individual permits. Under 116.913, an EGF permit authorizes nitrogen oxides (NOX) emissions from all grandfathered or electing electric generating facilities (EGF); and sulfur dioxide (SO2) emissions and particulate matter

emissions, through opacity limitations, for coal-fired grandfathered or electing EGFs. The grandfathered or electing EGF must comply with Chapter 101, Subchapter H, Division 2 of this title, relating to EBTA, including the requirement to maintain allowances in a compliance account. Facilities subject to the EBTA shall quantify and report emissions using the monitoring and reporting requirements of section 116.914. As noted previously, EPA’s action on Chapter 101, Subchapter H, Division 2, is being proposed in a separate action (RME Docket R06–OAR– 2005–TX–0012).

Section 116.914, specifies the monitoring and reporting requirements for EGFPs. The rule authorizes the use of Continuous Emission Monitoring (CEM) under the Acid Rain Program, which contains monitoring requirements for SO2 for affected units. Since the acid rain program already requires extensive monitoring, this section authorizes the use of that monitoring for EGF’s that are subject to the acid rain program for compliance with Subchapter I. EGFs not subject to the Acid Rain Program would have three choices in monitoring: the EGF may choose to meet either the Part 75 monitoring requirements, or the requirements of Title 40 CFR part 60; or, the EGF may provide an alternative monitoring plan that would be incorporated into the permit conditions. This alternate monitoring plan must meet state and federal requirements for approval. Monitoring and reporting requirements provisions related to the EBTA rule are set forth in section101.336(a), per 30 TAC Chapter 116.914.

Section 116.921 contains the hearing requirements for the initial issuance of EGFPs. If a hearing is requested by a person who may be affected by emissions from the grandfathered or electing EGF, and that request is reasonable, the commission will hold a hearing. The section requires that notice of hearing on a draft EGFP be published in the public notice section of one issue of a newspaper of general circulation in the municipality or the nearest municipality where the EGF is located. The notice must be published at least 30 days prior to a hearing.

The State of Texas submitted the SIP revision to EPA after adequate notice and public hearing on January 3, 2000. The Technical Supplement was submitted on August 5, 2009. See our Technical Support Document, Attachment C, for more details.

B. July 31, 2002 Submittal

In the July 31, 2002 submittal, Texas submitted new and amended rules to Chapter 116, which include Subchapter A: ‘‘Definitions,’’ delineating certain definitions of words and terms used in Subchapter I; Subchapter H: ‘‘Permits for Grandfathered Facilities,’’ Division 1, ‘‘General Applicability;’’ Division 2, ‘‘Small Business Stationary Source Permits,’’ ‘‘Pipeline Facilities Permits,’’ and ‘‘Existing Facility Permits;’’ Division 3, ‘‘Existing Facility Flexible Permits;’’ and Subchapter I: ‘‘Electric Generating Facility Permits.’’ In addition, Texas submitted TAC Chapter 39, ‘‘Public Notice,’’ which includes Subchapter H: ‘‘Applicability and General Provisions,’’ and Subchapter K: ‘‘Public Notice of Air Quality Applications.’’

EPA is acting only on Subchapter A: ‘‘Definitions,’’ and Subchapter I: ‘‘Electric Generating Facility Permits’’ of Chapter 116 from the July 31, 2002 submittal. The above-referenced provisions contained in the Subchapter H of Ch. 116 and the Subchapter K of Chapter 39 are severable and not part of today’s proposal action. Other revisions to Ch.116 establish requirements and procedures in Subchapter H for the permitting of grandfathered facilities in accordance with 5.02–5.04 of House Bill (HB) 2912, 77th Legislature, 2001, and Section 78 of HB 2914, 77th Legislature, 2001, which establishes an incentive program for the reduction of emissions of nitrogen oxides from certain grandfathered reciprocating internal combustion engines associated with pipelines. These severable submittals will be acted on in separate rulemakings.

The submitted amendments to Subchapter A, Section 116.10, ‘‘General Definitions,’’ revise the definition of ‘‘grandfathered facility’’ to be consistent with TCAA, section 382.0518(g). The revised definition clarifies that a grandfathered facility is one that is not a new facility, was constructed prior to August 30, 1971 (or no construction contract was executed on or before August 30, 1971 that specified a beginning construction date on or before February 29, 1972) and has not been modified since August 30, 1971. This definition is severable and previously acted on as approvable in a separate rulemaking (See 75 FR 19468, April 14, 2010). Therefore, it now is part of the Texas NSR SIP already.

The submitted amendments to Subchapter A, Section 116.18, ‘‘Electric Generating Facility Permits Definitions,’’ add a definition for ‘‘natural gas-fired electric generating facility’’ for consistency only with the EGF permit


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requirements of HB 2912. HB 2912 provides that a natural gas fired EGF includes a facility that was designed to burn both natural gas and fuel oil. The amendments also include a definition for ‘‘normal annual operating schedule,’’ to establish the normal annual operating schedule at an EGF site.

The submitted amendments to Subchapter I, Electric Generating Facility Permits, implement the portions of TCAA, section 382.0518, which create a new EGF permit. Representative sections of Subchapter I include: 116.911, Electric Generating Facility Permit Application; 116.913, General and Special Conditions; 116.917, Electric Generating Facility Permit Application for Certain Grandfathered Coal-Fired Electric Generating Facilities and Certain Grandfathered Facilities Located at Electric Generating Facility Sites; and 116.918, Additional General and Special Conditions for Grandfathered Coal-Fired Electric Generating Facilities and Certain Grandfathered Facilities Located at Electric Generating Facility Sites.

Under amended section 116.911, Electric Generating Facility Permit Application, a new EGF permit will allow the owners or operators of EGFs who have already applied for a permit required by SB 7 to apply for a permit for: (1) Generators that do not generate electric energy for compensation and are not used more than 10% of the annual operating schedule; and (2) auxiliary fossil-fuel-fired combustion facilities that do not generate electric energy and do not emit more than 100 tpy of any air contaminant. The adopted changes will also allow coal-fired EGFs which were required to apply for a permit under SB 7 to apply for an EGF permit for criteria pollutants other than NOX, SO2, and PM as it relates to opacity.

Section 116.913, General and Special Conditions, is amended to update the conditions of any permit issued under Subchapter I, including the pollutants or allowances that may be authorized for each permit, and the requirements of the SB 7 allowance trading program for the additional equipment which may be permitted under Subchapter I. The commission will issue a permit to these facilities.

Section 116.917, Electric Generating Facility Permit Application for Certain Grandfathered Coal-Fired Electric Generating Facilities and Certain Grandfathered Facilities Located at Electric Generating Facility Sites outlines the application requirements for grandfathered coal-fired EGFs which choose to permit their additional criteria pollutants, and the auxiliary generators and the additional combustion

equipment which can now be permitted under Subchapter I. To be consistent with the current review process for permits and applicable federal requirements, 116.917 requires the owner or operator of a grandfathered facility applying for an EGF permit to demonstrate that the facility meets applicable federal New Source Performance Standards (NSPS) and National Emission Standard for Hazardous Air Pollutants (NESHAP). If applicable, facilities would be required to comply with PSD and nonattainment review as specified in Chapter 116, Subchapter B, New Source Review Permits.

Section 116.918, Additional General and Special Conditions for Grandfathered Coal-Fired Electric Generating Facilities and Certain Grandfathered Facilities Located at Electric Generating Facility Sites identifies some of the general and special conditions which may be included in any permit issued under the adopted section 116.917. The holders of a permit shall comply with all such conditions. General conditions include: Sampling requirements, equivalency of methods, recordkeeping, maximum allowable emission rates, maintenance of emission control, and compliance with rules. The holders of permits shall also comply with all special conditions contained in the permit document.

The State of Texas submitted the SIP revision to EPA after adequate notice and public hearing on July 31, 2002. See our Technical Support Document, Attachment B, for more details.

III. Why are we proposing to partially approve and partially disapprove the January 3, 2000 submittal and approve the July 31, 2002 SIP submittal?

A. January 3, 2000 Submittal

Regarding the January 3, 2000 submittal, it is the intent of SB 7 that for the 12-month period beginning May 1, 2003, and for each 12-month period following, annual emissions of NOX from grandfathered EGFs not exceed 50% of the NOX emissions reported to the Commission for 1997. Furthermore, it is the intent of the legislation that emissions of SO2 from coal-fired EGFs not exceed 75% of the SO2 emissions reported to the Commission in 1997, and to contain appropriate opacity limitations by way of permitting the emissions of particulate matter. These provisions will cause additional emission reductions and ensure better protection of public health and welfare, and improve the existing SIP. These provisions, with the exception of 116.911(a)(2) discussed above, meet the

requirement in 40 CFR 51.160(a) that each plan include legally enforceable procedures to determine whether the construction or modification of a facility, building, structure, or installation, or combination of these will result in (1) A violation of applicable portions of the control strategy; or (2) interference with attainment or maintenance of a national standard in the State in which the proposed source (or modification) is located or in a neighboring State.

The revision also meets 40 CFR 51.160(e) by identifying a type of facility that will be subject to review under 40 CFR 51.160(a). In this case, TCEQ specifically identified grandfathered and electing electric generating facilities. See our Technical Support Document, Attachment A, for more details.


Regarding the July 31, 2002 submittal, this rulemaking allows the owners or operators of previously grandfathered and electing EGFs who have already applied for a permit required by SB 7 to also obtain a permit for all air contaminants, certain generators and auxiliary fossil fuel fired combustion facilities The adopted changes will also allow coal fired EGFs which were required to apply for a permit under SB 7 to apply for an EGF permit for criteria pollutants other than NOX, SO2, and PM as it relates to opacity. The permits issued for these facilities are expected to result in reduced emissions of air contaminants and improved compliance with state and federal air pollution control requirements. Further, these permits should achieve better protection of public health and welfare, and improve the existing SIP. These provisions meet the requirement in 40 CFR 51.160(a) that each plan include legally enforceable procedures to determine whether the construction or modification of a facility, building, structure, or installation, or combination of these will result in (1) a violation of applicable portions of the control strategy; or (2) interference with attainment or maintenance of a national standard in the state in which the proposed source (or modification) is located or in a neighboring state.

The revision also meets 40 CFR 51.160(e) by identifying a type of facility that will be subject to review under 40 CFR 51.160(a). In this case, Texas specifically identified grandfathered and electing electric generating facilities. See our Technical Support Document, Attachment B, for more details.


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C. CAA 110(l) Analysis

Each revision to an implementation plan submitted by a State under this Act shall be adopted by such State after reasonable notice and public hearing. The Administrator shall not approve a revision of a plan if the revision would interfere with any applicable requirement concerning attainment and reasonable further progress (as defined in section 171), or any other applicable requirement of this Act. EPA is proposing to approve these revisions because they improve the SIP in accordance with Section 110 of the Act. The reductions achieved through the SB7 program are throughout the State of Texas and include reducing precursors to ozone (NOx), SO2 emissions, and PM emissions. The NOx emissions reductions in certain regions of the State were assumed in Texas’ ozone attainment demonstration plans and will provide benefits in reducing ozone concentrations in nonattainment areas and near nonattainment areas, as well as attainment areas. There are no SO2 nonattainment areas in Texas. The only PM–10 nonattainment area in Texas is the El Paso geographic area. Any reductions in PM10 emissions due to these revisions should contribute to attainment of the PM10 NAAQS in that area. Further, EPA believes that any collateral emissions increases in carbon dioxide (CO) due to controls installed to limit NOx do not interfere with attainment or maintenance of the NAAQS for CO, nor cause or contribute to increase in any PSD increments. Texas is also currently in attainment for CO. Further, the permitting of grandfathered sources will benefit the public due to reductions of air contaminants emitted from affected EGFs, and present the opportunity for public participation and comment in the permitting procedures for formerly grandfathered EGFs and other participating EGFs. The program establishes requirements, procedures, deadlines and responsibilities for EGF permit applications for facilities formerly exempt from permit requirements.

IV. Proposed Action

EPA is proposing to partially approve and partially disapprove revisions to the Texas SIP that include 30 TAC Chapter 116, Subchapter A: ‘‘Definitions,’’ section 116.18; and Subchapter I: ‘‘Electric Generating Facility Permits,’’ sections 116.910–914, 116.916, 116.920–922, 116.930, and 116.931, which Texas submitted on January 3, 2000.

EPA is proposing to approve all of the January 3, 2000, SIP revision submittal as part of the Texas NSR SIP but for 30 TAC 116.911(a)(2). EPA is proposing to disapprove the submitted severable 30 TAC 116.911(a)(2) for collateral emissions increases of CO that are allowed to be permitted under the Texas PCP SP.

Further, EPA is proposing to approve revisions to the Texas SIP that include 30 TAC Chapter 116, Subchapter A: ‘‘Definitions,’’ section 116.18; and Subchapter I: ‘‘Electric Generating Facility Permits,’’ sections 116.910, 116.911, 116.913, 116.917, 116.918, 116.921, 116.926, 116.928, and 116.930, which Texas submitted on July 31, 2002. We are proposing to take no action on Chapter 116, Subchapter H: ‘‘Permits for Grandfathered Facilities,’’ which Texas submitted on July 31, 2002. The State understands that EPA will take future action on Subchapter H because it is independent from Subchapters A and I, and action is not necessary at this time.

The January 3, 2000 and July 31, 2002 submittals address the applicability and permitting requirements for grandfathered and electing electric generating facilities. The revisions will contribute to improvement in overall air quality in Texas. There will be no increase in ozone, SO2, and PM concentration levels because of approving the revisions. We have evaluated the State’s submittal, determined that it meets the applicable requirements of the CAA and EPA air quality regulations, and is consistent with EPA policy.

V. Statutory and Executive Order Reviews

A. Executive Order 12866, Regulatory Planning and Review

This action is not a ‘‘significant regulatory action’’ under the terms of Executive Order 12866 (58 FR 51735, October 4, 1993) and is therefore not subject to review under the Executive Order.

B. Paperwork Reduction Act

This action does not impose an information collection burden under the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. because this proposed SIP disapproval under section 110 and subchapter I, part D of the Clean Air Act will not in-and-of itself create any new information collection burdens but simply disapproves certain State requirements for inclusion into the SIP. Burden is defined at 5 CFR 1320.3(b).

C. Regulatory Flexibility Act

The Regulatory Flexibility Act (RFA) generally requires an agency to conduct a regulatory flexibility analysis of any rule subject to notice and comment rulemaking requirements unless the agency certifies that the rule will not have a significant economic impact on a substantial number of small entities. Small entities include small businesses, small not-for-profit enterprises, and small governmental jurisdictions. For purposes of assessing the impacts of today’s rule on small entities, small entity is defined as: (1) A small business as defined by the Small Business Administration’s (SBA) regulations at 13 CFR 121.201; (2) a small governmental jurisdiction that is a government of a city, county, town, school district or special district with a population of less than 50,000; and (3) a small organization that is any not-for-profit enterprise which is independently owned and operated and is not dominant in its field.

After considering the economic impacts of today’s proposed rule on small entities, I certify that this action will not have a significant impact on a substantial number of small entities. This rule does not impose any requirements or create impacts on small entities. This proposed SIP disapproval under section 110 and subchapter I, part D of the Clean Air Act will not in-and- of itself create any new requirements but simply disapproves certain State requirements for inclusion into the SIP. Accordingly, it affords no opportunity for EPA to fashion for small entities less burdensome compliance or reporting requirements or timetables or exemptions from all or part of the rule. The fact that the Clean Air Act prescribes that various consequences (e.g., higher offset requirements) may or will flow from this disapproval does not mean that EPA either can or must conduct a regulatory flexibility analysis for this action. Therefore, this action will not have a significant economic impact on a substantial number of small entities.

We continue to be interested in the potential impacts of this proposed rule on small entities and welcome comments on issues related to such impacts.

D. Unfunded Mandates Reform Act

This action contains no Federal mandates under the provisions of Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), 2 U.S.C. 1531– 1538 ‘‘for State, local, or tribal governments or the private sector.’’ EPA has determined that the proposed


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disapproval action does not include a Federal mandate that may result in estimated costs of $100 million or more to either State, local, or tribal governments in the aggregate, or to the private sector. This action proposes to disapprove pre-existing requirements under State or local law, and imposes no new requirements. Accordingly, no additional costs to State, local, or tribal governments, or to the private sector, result from this action.

E. Executive Order 13132, Federalism Executive Order 13132, entitled

‘‘Federalism’’ (64 FR 43255, August 10, 1999), requires EPA to develop an accountable process to ensure ‘‘meaningful and timely input by State and local officials in the development of regulatory policies that have federalism implications.’’ ‘‘Policies that have federalism implications’’ is defined in the Executive Order to include regulations that have ‘‘substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.’’

This action does not have federalism implications. It will not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132, because it merely disapproves certain State requirements for inclusion into the SIP and does not alter the relationship or the distribution of power and responsibilities established in the Clean Air Act. Thus, Executive Order 13132 does not apply to this action.

F. Executive Order 13175, Coordination With Indian Tribal Governments

This action does not have tribal implications, as specified in Executive Order 13175 (59 FR 22951, November 9, 2000), because the SIP EPA is proposing to disapprove would not apply in Indian country located in the State, and EPA notes that it will not impose substantial direct costs on tribal governments or preempt tribal law. Thus, Executive Order 13175 does not apply to this action.

G. Executive Order 13045, Protection of Children From Environmental Health Risks and Safety Risks

EPA interprets Executive Order 13045 (62 FR 19885, April 23, 1997) as applying only to those regulatory actions that concern health or safety risks, such that the analysis required

under section 5–501 of the Executive Order has the potential to influence the regulation. This action is not subject to Executive Order 13045 because it is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997). This proposed SIP disapproval under section 110 and subchapter I, part D of the Clean Air Act will not in-and-of itself create any new regulations but simply disapproves certain State requirements for inclusion into the SIP.

H. Executive Order 13211, Actions That Significantly Affect Energy Supply, Distribution, or Use

This proposed rule is not subject to Executive Order 13211 (66 FR 28355, May 22, 2001) because it is not a significant regulatory action under Executive Order 12866.

I. National Technology Transfer and Advancement Act

Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (‘‘NTTAA’’), Public Law 104–113, section 12(d) (15 U.S.C. 272 note) directs EPA to use voluntary consensus standards in its regulatory activities unless to do so would be inconsistent with applicable law or otherwise impractical. Voluntary consensus standards are technical standards (e.g., materials specifications, test methods, sampling procedures, and business practices) that are developed or adopted by voluntary consensus standards bodies. NTTAA directs EPA to provide Congress, through OMB, explanations when the Agency decides not to use available and applicable voluntary consensus standards.

The EPA believes that this action is not subject to requirements of Section 12(d) of NTTAA because application of those requirements would be inconsistent with the Clean Air Act.

J. Executive Order 12898: Federal Actions To Address Environmental Justice in Minority Populations and Low-Income Populations

Executive Order 12898 (59 FR 7629 (Feb. 16, 1994)) establishes federal executive policy on environmental justice. Its main provision directs federal agencies, to the greatest extent practicable and permitted by law, to make environmental justice part of their mission by identifying and addressing, as appropriate, disproportionately high and adverse human health or environmental effects of their programs, policies, and activities on minority populations and low-income populations in the United States.

EPA lacks the discretionary authority to address environmental justice in this proposed action. In reviewing SIP submissions, EPA’s role is to approve or disapprove state choices, based on the criteria of the Clean Air Act. Accordingly, this action merely proposes to disapprove certain State requirements for inclusion into the SIP under section 110 and subchapter I, part D of the Clean Air Act and will not in- and-of itself create any new requirements. Accordingly, it does not provide EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898.

List of Subjects in 40 CFR Part 52 Environmental protection, Air

pollution control, Carbon monoxide, Intergovernmental relations, Nitrogen oxides, Nonattainment, Ozone, Particulate matter, Reporting and recordkeeping requirements, Sulfur dioxide.

Authority: 42 U.S.C. 7401 et seq.

Dated: October 8, 2010. Lawrence E. Starfield, Acting Regional Administrator, Region 6. [FR Doc. 2010–26259 Filed 10–18–10; 8:45 am]



40 CFR Part 81

[Docket: EPA–R10–OAR–2010–0433; FRL– 9214–8]

Determination of Attainment for PM10: Eagle River PM10 Nonattainment Area, Alaska

AGENCY: Environmental Protection Agency (EPA). ACTION: Proposed rule.

SUMMARY: EPA proposed to determine that the Eagle River nonattainment area in Alaska attained the National Ambient Air Quality Standard for particulate matter with an aerodynamic diameter of less than or equal to a nominal ten micrometers (PM10) as of December 31, 1994. DATES: Comments must be received on or before November 18, 2010. ADDRESSES: Submit your comments, identified by Docket ID No. EPA–R10– OAR–2010–0433, by any of the following methods:

• http://www.regulations.gov: Follow the on-line instructions for submitting comments.


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1525 Federal Register / Vol. 76, No. 7 / Tuesday, January 11, 2011 / Rules and Regulations

(12) The National Declassification Center (NDC).

(f) NARA uses its office, program, and other official logos (usually in conjunction with the agency logo) for official business, which includes, but is not limited to: * * * * *

(g) Use of logos by others. NARA logos may be used by the public and other Federal agencies for events or activities co-sponsored by NARA, but only with the written approval of the Archivist or his designee. See Subpart C for procedures to request approval for use.

Subpart C—[Amended]

■ 4. Revise the heading for § 1200.8 to read as follows:

§ 1200.8 How do I request to use the official seals and logos?

* * * * *

Dated: January 5, 2011.

David S. Ferriero, Archivist of the United States. [FR Doc. 2011–492 Filed 1–10–11; 8:45 am]



40 CFR Part 52

[EPA–R06–OAR–2005–TX–0031; FRL–9248– 9]

Approval and Promulgation of Air Quality Implementation Plans; Texas; Revisions to Rules and Regulations for Control of Air Pollution; Permitting of Grandfathered and Electing Electric Generating Facilities

AGENCY: Environmental Protection Agency (EPA). ACTION: Final rule.

SUMMARY: EPA is taking final action to partially approve and partially disapprove revisions of the Texas State Implementation Plan (SIP) submitted by the Texas Commission on Environmental Quality (TCEQ, or Commission) on January 3, 2000, and July 31, 2002, as supplemented on August 5, 2009. These revisions are to regulations of the TCEQ that relate to application and permitting procedures for grandfathered electric generating facilities (EGFs). The revisions address a mandate by the Texas Legislature under Senate Bill 7 to achieve nitrogen oxide (NOX), sulfur dioxide (SO2) and particulate matter (PM) emission reductions from grandfathered EGFs. The emissions reductions will contribute to achieving attainment and help ensure attainment and continued maintenance of the National Ambient Air Quality Standards (NAAQS) for ozone, sulfur dioxide, and particulate matter in the State of Texas. As a result

of these mandated emissions reductions, in accordance with section 110(l) of the Federal Clean Air Act, as amended (the Act, or CAA), partial approval of these revisions will not interfere with attainment of the NAAQS, reasonable further progress, or any other applicable requirement of the Act. EPA has determined that the revisions, but for a severable provision, meet section 110, part C, and part D of the Federal Clean Air Act (the Act or CAA) and EPA’s regulations. Therefore, EPA is taking final action to approve the revisions but for a severable portion that allows collateral emissions increases of carbon monoxide (CO) created by the imposition of technology controls to be permitted under the State’s Standard Permit (SP) for Pollution Control Projects (PCP). EPA is taking final action to disapprove this severable portion concerning the issuance of a PCP SP for the CO collateral emissions increases. DATES: This final rule is effective on February 10, 2011. ADDRESSES: EPA has established a docket for this action under Docket Identification No. EPA–R06–OAR– 2005–TX–0031. All documents in this docket are listed at http:// www.regulations.gov. Although listed in the index, some information is not publicly available, e.g., Confidential Business Information or other information whose disclosure is restricted by statute. Certain other material, such as copyrighted material, is not placed on the Internet and will be publicly available only in hard copy form. Publicly available docket materials are available either

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electronically through http:// www.regulations.gov or in hard copy at the Air Permits Section (6PD–R), Environmental Protection Agency, 1445 Ross Avenue, Suite 700, Dallas, Texas 75202–2733. The file will be made available by appointment for public inspection in the Region 6 FOIA Review Room between the hours of 8:30 am and 4:30 pm weekdays except for legal holidays. Contact the person listed in the FOR FURTHER INFORMATION CONTACT paragraph below to make an appointment. If possible, please make the appointment at least two working days in advance of your visit. There will be a 15 cent per page fee for making photocopies of documents. On the day of the visit, please check in at the EPA Region 6 reception area at 1445 Ross Avenue, Suite 700, Dallas, Texas.

The State submittal, which is part of the EPA record, is also available for public inspection at the State Air Agency listed below during official business hours by appointment:

Texas Commission on Environmental Quality, Office of Air Quality, 12124 Park 35 Circle, Austin, Texas 78753. FOR FURTHER INFORMATION CONTACT: Mr. Rick Barrett, Air Permits Section (6PD– R), Environmental Protection Agency, Region 6, 1445 Ross Avenue, Suite 700, Dallas, Texas 75202–2733, telephone 214–665–7227; fax number 214–665– 7263; e-mail address: [email protected].

SUPPLEMENTARY INFORMATION: Throughout this document ‘‘we,’’ ‘‘our,’’ and ‘‘us’’ refers to EPA.

Outline

I. What action is EPA taking? II. Background

A. Texas Senate Bill 7 B. January 3, 2000 Submittal C. July 31, 2002 Submittal

III. What are the grounds for these actions? A. January 3, 2000 Submittal B. July 31, 2002 Submittal

IV. Did we receive public comments on the proposed rulemaking?

V. Final Action VI. Statutory and Executive Order Reviews

I. What action is EPA taking?

We are partially approving and partially disapproving the revision to Title 30, Chapter 116, of the TAC submitted by the State of Texas on January 3, 2000. We are also fully approving the revision to Title 30, Chapter 116, of the TAC submitted by the State of Texas on July 31, 2002. The January 3, 2000 submittal concerns Subchapter A: ‘‘Definitions,’’ section 116.18; and Subchapter I: ‘‘Electric Generating Facility Permits,’’ sections 116.910–914, 116.916, 116.920–922,

116.930, and 116.931. We are fully approving all of this 2000 submittal but for the severable reference in 30 TAC 116.911(a)(2) that, if approved, would allow the use of a Texas PCP SP for the permitting of the CO collateral emissions increases. We are disapproving this reference in submitted 30 TAC 116.911(a)(2) allowing the use of a PCP SP for the collateral CO emissions. The July 31, 2002 submittal concerns Subchapter A: ‘‘Definitions,’’ sections 116.10 and 116.18; and Subchapter I: ‘‘Electric Generating Facility Permits,’’ sections 116.910, 116.911, 116.913, 116.917, 116.918, 116.921, 116.926, 116.928, and 116.930. The TCEQ adopted these revisions on December 16, 1999, and May 22, 2002, respectively.

Please note that in the July 31, 2002 submittal concerning Subchapter A: ‘‘Definitions,’’ section 116.10 is severable and was approved in a separate rulemaking (See 75 FR 19468 April 14, 2010).

EPA is taking final action on the submitted application and permitting procedures for grandfathered EGFs, as mandated by the Texas Legislature, to achieve NOX, SO2 and PM emission reductions (Texas SB7 SIP) by December 31, 2010, as provided in the Consent Decree entered on January 21, 2010 in BCCA Appeal Group v. EPA, Case No. 3:08–cv–01491–N (N.D. Tex).

II. Background

A. Texas Senate Bill 7

Texas Senate Bill 7 (SB 7), formed under the 76th Texas State Legislature, 1999,amended the Texas Utilities Code (TUC), Title 2, Public Utility Regulatory Act, Subtitle B, Electric Utilities, and created a new Texas Utilities Code Chapter 39, ‘‘Restructuring of Electric Utility Industry.’’ SB 7 requires the TCEQ to establish a regulatory program implementing the statute’s mandatory emissions reductions for ‘‘grandfathered facilities’’ under the Texas Utilities Code section 39.264. A ‘‘grandfathered facility’’ is one that existed at the time the Legislature amended the Texas Clean Air Act (TCAA) in 1971.

These facilities were not required to comply with (i.e., grandfathered from) the then new requirement to obtain permits for construction or modifications of facilities that emit air contaminants. Texas began permitting new and modified sources in 1971, and sources built before Texas’ permitting rules became effective were not required to obtain permits for air emissions as long as they were not modified as defined under Texas’ New Source Review SIP program.

Section 39.264 of the TUC now requires EGFs that existed on January 1, 1999, to obtain a permit from the Commission even though these sources were not previously required to obtain a permit under the TCAA, section 382.0518(g).

Section 39.264 of the TUC specifically requires owners or operators of all grandfathered EGFs to apply for a permit to emit NOX and, for coal-fired grandfathered EGFs, SO2, and PM through opacity limitations. These applications were due on or before September 1, 2000. A grandfathered EGF that does not obtain a permit may not operate after May 1, 2003, unless the Commission finds good cause for an extension. Section 39.264 of the TUC requires that for the 12-month period beginning May 1, 2003, and for each 12-month period following, annual emissions of NOX from grandfathered EGFs not exceed 50% of the NOX emissions reported to the Commission for 1997. Furthermore, it requires that emissions of SO2 from coal-fired grandfathered EGFs not exceed 75% of the SO2 emissions reported to the Commission in 1997. In addition, TUC section 39.264(e) requires electric generating facility permits (EGFPs) for coal-fired, grandfathered EGFs to contain appropriate opacity limitations provided by the commission’s rules in 30 Texas Administrative Code (TAC) Ch.111.111, ‘‘Requirements for Specified Sources.’’ As described in more detail below, the emission limitations may be satisfied by using control technology or by participating in the banking and trading of allowances under Texas’ Emission Banking and Trading of Allowances (EBTA) program.

Overall, SB 7 mandates specific pollution reduction in an area, while allowing individual sources flexibility in how they meet emissions reductions. As participants in the program, EGFs must obtain a permit allocating them a certain level of emissions which they cannot exceed. In each defined region, the total level of emissions are restricted, or capped, to a level consistent with the SB 7 statutory goals. The individual EGF, to meet its allocated emissions level, can either choose to install pollution controls, shut down operations, or purchase allowances from another source that already reduced emission levels below its permitted amount.

To achieve SB 7’s mandate, the TCEQ revised 30 TAC Chapter 116, ‘‘Control of Air Pollution by Permits for New Construction or Modification,’’ by establishing an allowance and permitting program for regulating grandfathered EGFs under Subchapter I.

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TCEQ concurrently adopted Chapter 101, Subchapter H, ‘‘Emissions Banking and Trading,’’ that establishes a regional cap and trade system to distribute emission allowances for use by EGFs. The new Division 2, Chapter 101, Subchapter H, concerning EBTA, sets out the allowance system to be used to assist grandfathered and electing EGFs in meeting the emission reduction requirements of TUC, section 39.264. Together, the two rules define categories of EGFs that are eligible to use the trading system. As discussed above, the first category consists of grandfathered facilities. The second category of EGFs consist of currently permitted EGFs that are not subject to the permitting requirements mandated by SB 7, yet elect to participate in the allowance trading system. These are referred to as ‘‘electing’’ EGFs and participation in the permitting program will allow electing EGFs to obtain allowances under the EBTA.

Please note that EPA’s action on 30 TAC Chapter 101, Subchapter H, Division 2, concerning Emissions Banking and Trading of Allowances, is being finalized in a separate notice and is evaluated in a separate TSD. (RME Docket R06–OAR–2005–TX–0012).

The background for today’s actions is also discussed in more detail in our October 19, 2010, proposal to partially approve and partially disapprove revisions to the Texas SIP (75 FR 64235–64240).

B. January 3, 2000 Submittal

Regarding the January 3, 2000 submittal, SB 7 requires that for the 12- month period beginning May 1, 2003, and for each 12-month period following, annual emissions of NOX from all grandfathered EGFs not exceed 50% of the NOX emissions reported to the Commission for 1997. Furthermore, the legislation requires that emissions of SO2 from all coal-fired grandfathered EGFs not exceed 75% of the SO2 emissions reported to the Commission in 1997, and to contain appropriate opacity limitations by way of permitting the emissions of particulate matter.

C. July 31, 2002 Submittal

Regarding the July 31, 2002 submittal, this submittal allows the owners or operators of previously grandfathered and electing EGFs who have already applied for an electric generating facility (EGF) permit required by SB 7 to also obtain a permit for all air contaminants, certain generators and auxiliary fossil fuel fired combustion facilities.

III. What are the grounds for these actions?

A. January 3, 2000 Submittal These submitted provisions, with the

exception of 116.911(a)(2) discussed below, meet the requirement in 40 CFR 51.160(a) that each plan include legally enforceable procedures to determine whether the construction or modification of a facility, building, structure, or installation, or combination of these will result in (1) a violation of applicable portions of the control strategy; or (2) interference with attainment or maintenance of a national standard in the State in which the proposed source (or modification) is located or in a neighboring State. As such, they are consistent with the Act and its permitting requirements.

Regarding the submitted 30 TAC 116.911(a)(2), EPA approved Texas’s general regulations for Standard Permits in 30 TAC Subchapter F of 30 TAC Chapter 116 on November 14, 2003 (68 FR 64548) as meeting the minor NSR SIP requirements. The Texas Clean Air Act provides that the TCEQ may issue a standard permit for ‘‘new or existing similar facilities’’ if it is enforceable and compliance can be adequately monitored. See section 382.05195 of the TCAA. EPA approved the State’s Standard Permit program as part of the Texas Minor NSR SIP program on November 14, 2003 (68 FR 64548). However, when EPA approved the Texas Standard Permits Program as part of the Texas Minor NSR SIP, it explicitly did not approve the Pollution Control Project (PCP) Standard Permit (30 TAC 116.617). This is the PCP SP referenced in 30 TAC 116.911(a)(2) of this SIP submittal which owners or operators of grandfathered or electing electric generating facilities used to permit collateral emissions of CO which, otherwise, would have triggered PSD review. Following the State of New York, et al. v. EPA, 413 F.3d 801 (D.C. Cir. 2005) court decision (New York I), Texas submitted a repeal of the previously submitted PCP Standard Permit and submitted the adoption of a new PCP Standard Permit at 30 TAC 116.617—State Pollution Control Project Standard Permit, on February 1, 2006. One of the main reasons Texas adopted a new PCP Standard Permit was to meet the new Federal requirements to explicitly limit this PCP Standard Permit only to Minor NSR. In New York I, the Court vacated the federal pollution control project provisions for NNSR and PSD. Although the new PCP Standard Permit explicitly prohibits the use of it for Major NSR purposes, TCEQ failed to demonstrate how this particular

Standard Permit met the Texas Standard Permits NSR SIP since it applies to numerous types of pollution control projects, which can be used at any source that wants to use a PCP, and is not an authorization for similar sources. EPA disapproved the new PCP Standard Permit submittal on September 15, 2010. 75 FR 56,424 (September 15, 2010). Thus, we are disapproving the submitted 116.911 (a)(2) because it refers to and relies on the PCP SP that does not meet the applicable requirements of the Act, and was previously disapproved by EPA as a part of the Texas SIP.

The rationale for today’s actions is also discussed in more detail in our October 19, 2010, proposal to partially approve and partially disapprove revisions to the Texas SIP (75 FR 64237–64239). See our Technical Support Document, Attachment A, for additional details.


These provisions meet the requirement in 40 CFR 51.160(a) that each plan include legally enforceable procedures to determine whether the construction or modification of a facility, building, structure, or installation, or combination of these will result in (1) a violation of applicable portions of the control strategy; or (2) interference with attainment or maintenance of a national standard in the state in which the proposed source (or modification) is located or in a neighboring state. As such, they are consistent with the Act and its permitting requirements.

The rationale for today’s actions is also discussed in more detail in our October 19, 2010, proposal to partially approve and partially disapprove revisions to the Texas SIP (75 FR 64239). See our Technical Support Document, Attachment B, for additional details.

IV. Did we receive public comments on the proposed rulemaking?

In response to our October 19, 2010, proposal, we received comments from the following: Association of Electric Companies of Texas (AECT); Baker Botts, L.L.P., on behalf of Texas Industrial Project (TIP); Jackson Walker L.L.P., on behalf of the Gulf Coast Lignite Coalition (GCLC); Luminant Generation Company LLC (Luminant); Texas Commission on Environmental Quality (TCEQ); and Texas Mining and Reclamation Association (TMRA).

We respond to these comments in our evaluation and review under this final action below.


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Comment 1: TMRA, Luminant, GCLC, AECT, and TCEQ commented generally that the submitted 30 TAC 116.911(a)(2) was in compliance with all federal regulations and policies at the time it was adopted and submitted to EPA, and the subsequent court decisions including the EPA appeal decision, to vacate the provision should not be applied retroactively. Further, these commenters assert that EPA action on this provision should apply prospectively only and not to any permits issued prior to the court decisions.

Response: EPA disagrees with this comment. As discussed above, EPA approved the State’s Standard Permit program as part of the Texas Minor NSR SIP program on November 14, 2003 (68 FR 64548). When EPA approved the Texas Standard Permits Program as part of the Texas Minor NSR SIP, it explicitly DID NOT approve the Pollution Control Project (PCP) Standard Permit (30 TAC 116.617). This is the PCP SP referenced in 30 TAC 116.911(a)(2) of this SIP submittal which owners or operators of grandfathered or electing electric generating facilities used to permit collateral emissions of CO which, otherwise, would have triggered PSD review. Following New York 1, Texas submitted a repeal of the previously submitted PCP Standard Permit and submitted the adoption of a new PCP Standard Permit at 30 TAC 116.617— State Pollution Control Project Standard Permit, on February 1, 2006. One of the main reasons Texas adopted a new PCP Standard Permit was to meet the new Federal requirements to explicitly limit this PCP Standard Permit only to Minor NSR. In New York 1, the Court vacated the federal pollution control project provisions for NNSR and PSD. Although the new PCP Standard Permit explicitly prohibits the use of it for Major NSR purposes, TCEQ has failed to demonstrate how this particular Standard Permit meets the Texas Standard Permits NSR SIP since it applies to numerous types of pollution control projects, which can be used at any source that wants to use a PCP, and is not an authorization for similar sources. EPA disapproved the new PCP Standard Permit submittal on September 15, 2010. 75 FR 56,424 (September 15, 2010).

We are disapproving the submitted 116.911(a)(2) because the reference in it which allows obtaining a PCP SP for the collateral emissions does not meet the applicable requirements of the Act, as discussed herein, and was disapproved by EPA as a part of the Texas SIP. EPA is required to review a SIP revision for

its compliance with the Act and EPA regulations. See CAA section 110(k)(3); see also BCCA Appeal Group v. EPA, 355 F 3d.817, 822 (5th Cir 2003); Natural Resources Defense Council, Inc. v. Browner, 57 F.3d 1122, 1123 (D.C. Cir 1995).

Comment 2: TMRA, TIP, Luminant, GCLC, and AECT commented generally that the Clean Air Act requires that EPA ‘‘shall not approve a revision of a plan if the revision would interfere with any applicable requirement concerning attainment and reasonable further progress * * *.’’ EPA should therefore approve 116.911(a)(2) because EPA discusses in its proposed rule dated October 19, 2010, that the CO increases do not interfere with attainment or maintenance of the NAAQS for CO, nor cause or contribute to increase in PSD increments, much less a violation of any NAAQS.

Response: This comment misunderstands the basis on which we are disapproving 116.911(a)(2). We are disapproving the submitted 30 TAC 116.911(a)(2) because it allows the source to obtain a permit for its collateral CO emissions that is not a part of the Texas SIP. EPA previously disapproved the permit allowed for the collateral CO emissions because it did not meet the applicable requirements of the Act. EPA is required to review a SIP revision for its compliance with the Act and EPA regulations. See CAA section 110(k)(3); see also BCCA Appeal Group v. EPA, 355 F 3d.817, 822 (5th Cir 2003); Natural Resources Defense Council, Inc. v. Browner, 57 F.3d 1122, 1123 (D.C. Cir 1995).

Comment 3: TIP, Luminant, and GCLC commented generally that the court decision of June 24, 2005, does not apply to 116.911(a)(2). That court decision dealt with an exclusion from major NSR, whereas the PCP SP is a minor NSR permitting process and authorization tool and the SP cannot be used to circumvent major NSR. One commenter noted that ‘‘in light of’’ the court decision, on February 1, 2006, Texas submitted to EPA a revised version of 30 TAC § 116.617 (Standard Permits for Pollution Control Projects) to ‘‘limit the use of the state’s PCP SP to Minor NSR’’.

Response: EPA disagrees with this comment. See response to comment 1.

Comment 4: TMRA, Luminant, and AECT commented generally that they disagree with EPA’s allegation that there were two facilities where collateral emissions of Carbon Monoxide (CO) above the PSD significance level occurred following the installation of pollution control equipment. Further, that they disagree with EPA’s proposal

to disapprove these already issued permits.

Response: EPA disagrees with this comment. EPA is not disapproving these two already issued permits with this SIP action. Our disapproval is strictly limited to the provision 30 TAC 116.911(a)(2) of the January 3, 2000, SIP submittal. Although it is not a basis for EPA’s final action here, EPA stands by its previous discussion of the facilities where collateral emissions of CO above PSD significance levels occurred following the installation of pollution control equipment.

Comment 5: TMRA, Luminant, and AECT commented that EPA should follow its established position that Pollution Control Project permits are acceptable under the Clean Air Act.

Response: It is not EPA’s position, established or otherwise, that PCP permits are acceptable under the Clean Air Act for Major NSR. Furthermore, the New York I opinion addressed the use of PCPs and disapproved their use for Major NSR requirements. In that decision, the court vacated the provisions of the Federal 2002 NSR Reform rule that specifically related to PCPs. The EPA must comply with the court decision. EPA disapproved the State’s submitted PCP SP for Minor NSR. See response to comment 1.

Comment 6: TMRA and AECT commented generally that the proposed disapproval has a chilling effect on much needed economic investment and makes it even more difficult for companies to create jobs and provide for economic growth. Further, that the Senate Bill 7 program has achieved substantial emission reductions while providing a fair and predictable regulatory framework that is protective of human health and the environment.

Response: Under the NAAQS provisions of the CAA, air pollution control at its source is the primary responsibility of States and local governments. EPA is respectful of the Act and cognizant of the cooperative federalism principle contained therein. However, while the Act does give States a fair degree of latitude in choosing the mix of controls necessary to meet and maintain the NAAQS, it also places some limits on the choices States can make. EPA’s role is to ensure that the SIP submittal is consistent with the CAA. Any SIP submittal must adhere to applicable requirements of the federal CAA, including the obligation to provide for attainment and maintenance of the NAAQS and to ensure that the SIP may be adequately enforced. EPA’s statutory responsibilities in reviewing a SIP are to ensure it meets the requirements of the Act. As explained in


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the proposal and above, as part of EPA’s review, we determined that the provision providing for the obtaining of a non-SIP PCP SP is inconsistent with the CAA. See CAA section 110(k)(3); see also BCCA Appeal Group v. EPA, 355 F 3d.817, 822 (5th Cir 2003); Natural Resources Defense Council, Inc. v. Browner, 57 F.3d 1122, 1123 (D.C. Cir 1995).

Comment 7: Luminant commented that EPA incorrectly concludes that its prior disapproval of 30 TAC 116.617 necessitates disapproval of 30 TAC 116.911(a)(2). Rather, EPA must independently justify its disapproval of these provisions relating to the Texas Senate Bill No. 7 (‘‘SB7’’) permitting program. Further, that EPA’s disapproval of 30 TAC 116.617 does not justify or require disapproval of 30 TAC 116.911(a)(2). Also, the obligation thus originates from the SB7 permit rules, and EPA has an independent obligation to justify its disapproval of the substance of those requirements in this rulemaking and not simply rely on a prior one that did not involve the SB7 permit program.

Response: EPA disagrees with this comment. 30 TAC 116.911(a)(2) allows a SB7 source that has collateral emissions of CO to obtain a TCEQ PCP SP rather than obtaining a Texas NSR SIP permit, for its CO collateral emissions. The PCP SP is not a part of the Texas NSR SIP. See the response to comment 1. Moreover, EPA is required to review a SIP revision for its compliance with the Act and EPA regulations. See CAA section 110(k)(3); see also BCCA Appeal Group v. EPA, 355 F 3d.817, 822 (5th Cir 2003); Natural Resources Defense Council, Inc. v. Browner, 57 F.3d 1122, 1123 (D.C. Cir 1995).

Comment 8: Luminant commented that it supports the remainder of proposed approval of the January 3, 2000 and July 31, 2002 submittals. It also supports the EPA’s November 16, 2010 direct final rule to approve the EBTA program.

Response: EPA acknowledges this comment.

Comment 9: The TCEQ commented that it maintains its position that § 116.617 is an efficient and legally supportable authorization for pollution control projects in Texas.

Response: EPA disagrees with this comment. We disapproved the PCP SP on September 15, 2010. See 75 FR 56,424 (September 15, 2010).

IV. Final Action EPA is partially approving and

partially disapproving revisions to the Texas SIP that include 30 TAC Chapter

116, Subchapter A: ‘‘Definitions,’’ section 116.18; and Subchapter I: ‘‘Electric Generating Facility Permits,’’ sections 116.910–914, 116.916, 116.920–922, 116.930, and 116.931, which Texas submitted on January 3, 2000.

EPA is approving all of the January 3, 2000, SIP revision submittal as part of the Texas NSR SIP but for 30 TAC 116.911(a)(2). EPA is disapproving the submitted severable 30 TAC 116.911(a)(2) for collateral emissions increases of CO that are allowed to be permitted under the Texas PCP SP.

Further, EPA is approving revisions to the Texas SIP that include 30 TAC Chapter 116, Subchapter A: ‘‘Definitions,’’ section 116.18; and Subchapter I: ‘‘Electric Generating Facility Permits,’’ sections 116.910, 116.911, 116.913, 116.917, 116.918, 116.921, 116.926, 116.928, and 116.930, which Texas submitted on July 31, 2002. We are taking no action on Chapter 116, Subchapter H: ‘‘Permits for Grandfathered Facilities,’’ which Texas submitted on July 31, 2002. The State understands that EPA will take future action on Subchapter H because it is independent from Subchapters A and I, and action is not necessary at this time.

The January 3, 2000 and July 31, 2002 submittals address the applicability and permitting requirements for grandfathered and electing electric generating facilities. The revisions will contribute to improvement in overall air quality in Texas. There will be no increase in ozone, SO2, and PM concentration levels because of approving the revisions. We have evaluated the State’s submittal, determined that it meets the applicable requirements of the CAA and EPA air quality regulations, and is consistent with EPA policy.

V. Statutory and Executive Order Reviews

A. Executive Order 12866, Regulatory Planning and Review

This final action has been determined not to be a ‘‘significant regulatory action’’ subject to review by the Office of Management and Budget under Executive Order 12866 (58 FR 51735, October 4, 1993).

B. Paperwork Reduction Act

This action does not impose an information collection burden under the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501 et seq., because this SIP disapproval under section 110 and subchapter I, part D of the Clean Air Act will not in-and-of itself create any new information collection burdens but

simply disapproves certain State requirements for inclusion into the SIP. Burden is defined at 5 CFR 1320.3(b). Because this final action does not impose an information collection burden, the Paperwork Reduction Act does not apply.

C. Regulatory Flexibility Act

The Regulatory Flexibility Act (RFA) generally requires an agency to conduct a regulatory flexibility analysis of any rule subject to notice and comment rulemaking requirements unless the agency certifies that the rule will not have a significant economic impact on a substantial number of small entities. Small entities include small businesses, small not-for-profit enterprises, and small governmental jurisdictions. For purposes of assessing the impacts of today’s rule on small entities, small entity is defined as: (1) A small business as defined by the Small Business Administration’s (SBA) regulations at 13 CFR 121.201; (2) a small governmental jurisdiction that is a government of a city, county, town, school district or special district with a population of less than 50,000; and (3) a small organization that is any not-for-profit enterprise which is independently owned and operated and is not dominant in its field. This rule will not have a significant impact on a substantial number of small entities because SIP approvals and disapprovals under section 110 and part D of the Clean Air Act do not create any new requirements but simply approve or disapprove requirements that the States are already imposing.

Furthermore, as explained in this action, the submissions do not meet the requirements of the Act and EPA cannot approve the submissions. The final disapproval will not affect any existing State requirements applicable to small entities in the State of Texas. Federal disapproval of a State submittal does not affect its State enforceability. After considering the economic impacts of today’s rulemaking on small entities, and because the Federal SIP disapproval does not create any new requirements or impact a substantial number of small entities, I certify that this action will not have a significant economic impact on a substantial number of small entities. Moreover, due to the nature of the Federal-State relationship under the Clean Air Act, preparation of flexibility analysis would constitute Federal inquiry into the economic reasonableness of state action. The Clean Air Act forbids EPA to base its actions concerning SIPs on such grounds. Union Electric Co. v. U.S. EPA,


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427 U.S. 246, 255–66 (1976); 42 7410(a)(2).

D. Unfunded Mandates Reform Act This action contains no Federal

mandates under the provisions of Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), 2 U.S.C. 1531– 1538 ‘‘for State, local, or tribal governments or the private sector.’’ EPA has determined that the disapproval action does not include a Federal mandate that may result in estimated costs of $100 million or more to either State, local, or tribal governments in the aggregate, or to the private sector. This Federal action determines that pre- existing requirements under State or local law should not be approved as part of the Federally approved SIP. It imposes no new requirements. Accordingly, no additional costs to State, local, or tribal governments, or to the private sector, result from this action.

E. Executive Order 13132, Federalism Executive Order 13132, entitled

‘‘Federalism’’ (64 FR 43255, August 10, 1999), requires EPA to develop an accountable process to ensure ‘‘meaningful and timely input by State and local officials in the development of regulatory policies that have Federalism implications.’’ ‘‘Policies that have Federalism implications’’ is defined in the Executive Order to include regulations that have ‘‘substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.’’

This action does not have Federalism implications. It will not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132, because it merely disapproves certain State requirements for inclusion into the SIP and does not alter the relationship or the distribution of power and responsibilities established in the Clean Air Act. Thus, Executive Order 13132 does not apply to this action.

F. Executive Order 13175, Coordination With Indian Tribal Governments

This action does not have tribal implications, as specified in Executive Order 13175 (59 FR 22951, November 9, 2000), because the SIP EPA is disapproving would not apply in Indian country located in the State, and EPA notes that it will not impose substantial

direct costs on tribal governments or preempt tribal law. This final rule does not have tribal implications, as specified in Executive Order 13175. It will not have substantial direct effects on tribal governments, on the relationship between the Federal government and Indian tribes, or on the distribution of power and responsibilities between the Federal government and Indian tribes. This action does not involve or impose any requirements that affect Indian Tribes. Thus, Executive Order 13175 does not apply to this action.

G. Executive Order 13045, Protection of Children From Environmental Health Risks and Safety Risks

EPA interprets Executive Order 13045 (62 FR 19885, April 23, 1997) as applying only to those regulatory actions that concern health or safety risks, such that the analysis required under section 5–501 of the Executive Order has the potential to influence the regulation. This action is not subject to Executive Order 13045 because it is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997). This SIP disapproval under section 110 and subchapter I, part D of the Clean Air Act will not in-and-of itself create any new regulations but simply disapproves certain State requirements for inclusion into the SIP.

H. Executive Order 13211, Actions That Significantly Affect Energy Supply, Distribution, or Use

This rule is not subject to Executive Order 13211 (66 FR 28355, May 22, 2001) because it is not a significant regulatory action under Executive Order 12866.

I. National Technology Transfer and Advancement Act

Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (‘‘NTTAA’’), Public Law 104–113, section 12(d) (15 U.S.C. 272 note) directs EPA to use voluntary consensus standards in its regulatory activities unless to do so would be inconsistent with applicable law or otherwise impractical. Voluntary consensus standards are technical standards (e.g., materials specifications, test methods, sampling procedures, and business practices) that are developed or adopted by voluntary consensus standards bodies. NTTAA directs EPA to provide Congress, through the Office of Management and Budget, explanations when the Agency decides not to use available and applicable voluntary consensus standards.

EPA believes that this action is not subject to requirements of Section 12(d) of NTTAA because application of those requirements would be inconsistent with the Clean Air Act. Today’s action does not require the public to perform activities conducive to the use of voluntary consensus standards.

J. Executive Order 12898: Federal Actions To Address Environmental Justice in Minority Populations and Low-Income Populations

Executive Order 12898 (59 FR 7629, (February 16, 1994)) establishes Federal executive policy on environmental justice. Its main provision directs Federal agencies, to the greatest extent practicable and permitted by law, to make environmental justice part of their mission by identifying and addressing, as appropriate, disproportionately high and adverse human health or environmental effects of their programs, policies, and activities on minority populations and low-income populations in the United States.

EPA lacks the discretionary authority to address environmental justice in this action. In reviewing SIP submissions, EPA’s role is to approve or disapprove state choices, based on the criteria of the Clean Air Act. Accordingly, this action merely disapproves certain State requirements for inclusion into the SIP under section 110 and subchapter I, part D of the Clean Air Act and will not in- and-of itself create any new requirements. Accordingly, it does not provide EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under E‘xecutive Order 12898.

K. Congressional Review Act

The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this rule and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the Federal Register. A major rule cannot take effect until 60 days after it is published in the Federal Register. This action is not a ‘‘major rule’’ as defined by 5 U.S.C. 804(2).


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L. Petitions for Judicial Review

Under section 307(b)(1) of the Clean Air Act, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by March 14, 2011. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this rule for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action may not be challenged later in proceedings to enforce its requirements. See section 307(b)(2).

List of Subjects in 40 CFR Part 52

Environmental protection, Air pollution control, Carbon monoxide,

Incorporation by reference, Intergovernmental relations, Nitrogen oxides, Nonattainment, Ozone, Particulate matter, Reporting and recordkeeping requirements, Sulfur dioxide.


Dated: December 29, 2010. Samuel Coleman, Acting Regional Administrator, Region 6.

40 CFR part 52 is amended as follows:

PART 52—[AMENDED]

1. The authority citation for part 52 continues to read as follows:


Subpart SS—Texas

■ 2. The table in § 52.2270 (c) entitled ‘‘EPA Approved Regulations in the

Texas SIP’’ is amended under Chapter 116—Control of Air Pollution by Permits for New Construction or Modification, as follows: ■ a. Immediately following the entry for Section 116.14, by adding a new entry for Section 116.18, Electric Generating Facility Permits Definitions; and ■ b. Immediately following section 116.615, by adding a new centered heading entitled ‘‘Subchapter I—Electric Generating Facility Permits’’ followed by new entries for Sections 116.910, 116.911, 116.912, 116.913, 116.914, 116.916, 116.917, 116.918, 116.920, 116.921, 116.922, 116.926, 116.928, 116.930, and 116.931.

The additions read as follows:

§ 52.2270 Identification of plan.

(c) * * *

State citation Title/subject

State approval/ submittal

date

EPA approval date Explanation

* * * * * * * Chapter 116 (Reg 6)—Control of Air Pollution by Permits for New Construction or Modification

* * * * * * * Subchapter A—Definitions

* * * * * * * Section 116.18 .......... Electric Generating Facility Per-

mits Definitions.5/22/2002 1/11/2011, [Insert FR page num-

ber where document begins].

* * * * * * * Subchapter I—Electric Generating Facility Permits

* * * * * * * Section 116.910 ........ Applicability ................................ 5/22/2002 1/11/2011, [Insert FR page num-

ber where document begins].Section 116.911 ........ Electric Generating Facility Per-

mit.5/22/2002 1/11/2011, [Insert FR page num-

ber where document begins].116.911(a)(2) is not in the SIP.

Section 116.912 ........ Electric Generating Facilities ..... 12/16/1999 1/11/2011, [Insert FR page num-ber where document begins].

Section 116.913 ........ General and Special Conditions 5/22/2002 1/11/2011, [Insert FR page num-ber where document begins].

Section 116.914 ........ Emissions Monitoring and Re-porting Requirements.

12/16/1999 1/11/2011, [Insert FR page num-ber where document begins].

Section 116.916 ........ Permits for Grandfathered and Electing Generating Facilities in El Paso County.


Section 116.917 ........ Electric Generating Facility Per-mit Application for Certain Grandfathered Coal-Fired Electric Generating Facilities and Certain Facilities Located at Electric Generating Facility Sites.


Section 116.918 ........ Additional General Special Con-ditions for Grandfathered Coal-Fired Electric Generating Facilities and Certain Facilities Located at Electric Generating Facility Sites.


Section 116.920 ........ Applicability ................................ 12/16/1999 1/11/2011, [Insert FR page num-ber where document begins].

Section 116.921 ........ Notice and Comment Hearings for Initial Issuance.



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1 The Hayden planning area straddles Gila and Pinal counties at the confluence of the Gila and San Pedro rivers in east central Arizona. The nonattainment area covers roughly 700 square miles of mountainous terrain. Cities and towns within this area include Kearney (population roughly 2,800), Hayden (population roughly 800), and Winkelman (population roughly 400).

2 The Nogales planning area covers approximately 70 square miles along the border with Mexico within Santa Cruz County. The only significant population center in this area is the city of Nogales with a population of roughly 21,000. The population of Nogales, Mexico, which lies just

State citation Title/subject

State approval/ submittal

date

EPA approval date Explanation

Section 116.922 ........ Notice of Final Action ................. 12/16/1999 1/11/2011, [Insert FR page num-ber where document begins].

Section 116.926 ........ Permit Fee .................................. 5/22/2002 1/11/2011, [Insert FR page num-ber where document begins].

Section 116.928 ........ Delegation .................................. 5/22/2002 1/11/2011, [Insert FR page num-ber where document begins].

Section 116.930 ........ Amendments and Alterations Issued Under this Subchapter.


Section 116.931 ........ Renewal ..................................... 12/16/1999 1/11/2011, [Insert FR page num-ber where document begins].

* * * * * * *

■ 3. Section 52.2273 is amended by adding a new paragraph (f) to read as follows:

§ 52.2273 Approval status.

* * * * * (f) EPA is disapproving the Texas SIP

revision submittals under 30 TAC Chapter 116—Control of Air Pollution by Permits for New Construction or Modification as follows:

(1) Subchapter I—Electric Generating Facility Permits—Section 116.911(a)(2) (Electric Generating Facility Permit), adopted December 16, 1999, and submitted January 3, 2000. [FR Doc. 2011–222 Filed 1–10–11; 8:45 am]



40 CFR Part 81

[EPA–R09–OAR–2010–0718; FRL–9250–1]

Determinations of Attainment by the Applicable Attainment Date for the Hayden, Nogales, Paul Spur/Douglas PM10 Nonattainment Areas, Arizona

AGENCY: Environmental Protection Agency (EPA). ACTION: Final rule.

SUMMARY: EPA is making final determinations that the Hayden, Nogales, and Paul Spur/Douglas nonattainment areas in Arizona attained the National Ambient Air Quality Standard (NAAQS) for particulate matter with an aerodynamic diameter of less than or equal to a nominal ten micrometers (PM10) by their applicable attainment dates of December 31, 1994. On the basis of these determinations, EPA concludes that these three ‘‘moderate’’ nonattainment areas are not subject to reclassification by operation of law to ‘‘serious.’’ EPA is not finalizing determinations with respect to the air

quality in these areas subsequent to their 1994 attainment dates. DATES: Effective Date: This rule is effective on February 10, 2011. ADDRESSES: EPA has established docket number EPA–R09–OAR–2010–0718 for this action. The index to the docket is available electronically at http:// www.regulations.gov and in hard copy at EPA Region IX, 75 Hawthorne Street, San Francisco, California. While all documents in the docket are listed in the index, some information may be publicly available only at the hard copy location (e.g., copyrighted material), and some may not be publicly available in either location (e.g., CBI). To inspect the hard copy materials, please schedule an appointment during normal business hours with the contact listed in the FOR FURTHER INFORMATION CONTACT section. FOR FURTHER INFORMATION CONTACT: Wienke Tax at telephone number: (415) 947–4192; e-mail address: [email protected], or the above EPA, Region IX address. SUPPLEMENTARY INFORMATION: Throughout this document, wherever ‘‘we’’, ‘‘us’’ or ‘‘our’’ are used, we mean EPA. Information is organized as follows:

Table of Contents

I. Context for Today’s Actions II. Summary of Proposed Actions III. Public Comments and EPA Responses IV. Final Action V. Statutory and Executive Order Reviews

I. Context for Today’s Actions On November 2, 2010 (75 FR 67220),

we published a direct final rule that made certain determinations we are making in this document. On November 2, 2010 (75 FR 67303), we also published a corresponding proposed rule in the event that we received adverse comment leading us to withdraw the direct final rule. In our direct final rule, we indicated that we would withdraw the direct final rule if

we received adverse comments, and address public comments in a subsequent final rule based on the proposed rule. On November 3, 2010, we received adverse comments, and subsequently withdrew the direct final rule (75 FR 72964, November 29, 2010). Today, we take final action based on our November 2, 2010 proposed rule and our consideration of the public comments received.

II. Summary of Proposed Actions In our November 2, 2010 proposed

rule, we proposed to determine, pursuant to section 188(b)(2) of the Clean Air Act, that three Arizona ‘‘moderate’’ PM10 nonattainment areas (Hayden, Nogales, and Paul Spur/ Douglas) had attained the PM10 NAAQS by the applicable attainment date (December 31, 1994), and that, based on these proposed determinations, we concluded that none of these areas is subject to reclassification to serious by operation of law. We also proposed to find that more recent data for 2007– 2009 show none of the areas is currently attaining the standard. More detailed information is contained in the November 2 direct final rule, which is summarized in the paragraphs that follow.

First, our direct final rule described the relevant NAAQS, 150 micrograms per cubic meter (μg/m3), 24-hour average, against which monitored ambient concentrations of PM10 in the three subject areas (Hayden,1 Nogales,2


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SCHEDULE B; PEMALTIES FOR FACILITIES SERVING PERSONS WITN MENTAL RETARDATUIf AIm/Ol RELATED C~ITICIIS

DESCRIPTION OF CONDITIONS AND ELEMENTS OF CONDITIONS FIRST SECOND

OFFENSE OFFENSE (1) ,2>

A. • C. (No change.)

H. Failure to saait a renewal of dliIf1ge of ownership license 8A)lication as required in accordance 'lith H9O.15 or 90.16 of this title (relating to Renewal />roce6ses and Qual ificaticns and Chilf1ge of ~rship).

1. 1. The facH ity does not s..uit a license r_l application at least 45 days before ttl.e cwrent license expiration date. 500 1,000

2. 2. During a charee of ownership process, ttl.e prospective purchaser does not saait a license appl ication to the licensing progr_ at least 30 days before the anticipated sale date.

(d)[(e)] The maximum hourly rate for legal services shall be as follows: 1I0urly rale:

CAl Attorney- S150;

(Bl Legal assistanl (not 10 include hours for general office staff) $50 [When an attorney's only service has been to assist a claimant with completing and filing claim forms and other documents, and the claun is not disputed, the range of hours allowed shall be in the range of one to three hours, depending upon the extent of setvices rendered J

This aoency hereby cer1ifies thallhe proposal has been reviewed by legal counsel and found 10 be wllhin the agency's authority to -. Issued WI Aushn, Texas, on Octcber 29,1993. TAD·9331266 ... ~ """ General CounllGI

Tex .. WoOIers' ~er.allon Com_

Earliest possible date 01 adoption: December 10, 1993

For luther Inlonnation, please call: (512) 440-3592

• • •

500 1,000

TITLE 30. ENVIRONMENTAL QUALITY

Part 1. Texas Natural Resource Conservation Commission

Chapter 116. Control of Air Pollution by Permits For New Construction or Modification

Subchapter B. New Source Review Permits

Permit Application • 30 TAC 1116.110, 1116.115

The Texas Nah..-at Resource Conservation Commission (TNRCC) proposes amend· ments to §116.110, concerning Applicability; § 116.115, concerning Special Provisions; §116.211, concerning the Standard Exemption LisI; and §116.311 (b) and (e), concerning Permit Renewal Applications. Also, TNRCC proposes a new Stb::hapler F, Slarr:tard Per· mits, containing new §§116.610, 116.611 , 116.614, and 116.617, to establish a category 01 standard perm~s . The proposed changes nave been developed in response 10 recommendalions by the Permi1:s Wo1Ishop Task Face and directives from the kloner Te~as Air Control Board to streamline the permit

• Proposed Sectiotls

THIRD OR SUBSEQUENT

OFFENSE

'"

1,500

1,500

process. The proposed changes 10 the Standard Exemption LisI consS 01 revisions 10 Siandard Exefl1)tion (SE) 75, SE 107, SE 113, and a new SE 124. The proposed revisions 10 SE 107, regarding vapor delJ1lasers, and SE 113, regarding thermoset resin operations, were recommended by the Permits stalf. The proposed new SE 124, relating 10 aUlo body shops, and revised SE 75, relating to stfiace coating lacililies, were developed by the Auto Body Shop Task Face to provide a means lor the lhousands of auto boItt shops located in TedS to comply with Chapter 116 requirements.

The proposed new Stb::hapler F eslalllishes a new category 01 new SOlJ'"C8 review pennits referred to as slarOard permils. The standard perm~ simptifies and accelerales the permit review process by establishing standardized cond~jons targeting a specific indLlStry Of type 01 tac~ity . The permit w~1 contain specific conditions and requirements pertairMg to a specific industry a SCU"ee type. If an appticant can meet al of the condi1:ions 01 a standard permit, then it would not be necessary 10 stbmil a oeneral applicalion under lhe reo quirements 01 §116.111. This wi' streaml .... lhe agency review process, and allow mae rapi:l approval than would be possible uncler the oeneralized permit review pr0C9SS. The first two standard perrn~s w~1 be lor emission conln:li projects required by rule and volunlay emission control projects. Slandard Pernit Nurrber 1 wWI authorize the instaftalion 01 emission conlrol ~ a impIementa· lion of controf lecI"w1iques for emission control

No .. ember 9. 1993 1ll TexReg (J145

Add. 16


Add. 17


Public heaMgs on the IYQPOSaI w~1 be held Decerrber 2,1993, al 2:00 p .m. in lOe City 01 Houslon Polulion Control Building Auditorium, 7411 Par1< Place Boulevard, Houston. and on Decembet" 3, 1993, at 10:00 a.m. in !he ALOiIorium (Room 201S) 01 the TNACC Central Office, Air Qua.I~y Planning Annex, located al12118 North IH-35, Park 35 TechnolOgy Center, Building E, Austin. The hear· ings are sIrucIu-ed lor the receipt 01 oral or writen commenls by interested persons. Interrogation or cross-examination is not permitted; no.veV8(, a TNACC staft member will discuss the proposal 30 mintAes belore the hearing and wiK be available to answer ques· tions.

Wrinen comments not presented altha hearWig may be sl.Cmilled to the TNACC, Air Quality Plaming OMsion, P.O. Box 13087, Austin, Texas 76711 tlYough December 17, 1993. Material received by the Regulation Developmert Section by 4:00 p .m. on lhat date wi. be coosDered by the Commission prior to any final action on the proposed sections. Copies of the proposat are available al !he TNACC AK Quality Planning Annex 10-eated 8112118 North tH-35. Park 35 Technol· ogy Center, Building E, Austin, Texas 78753, and at 81 TNACC regional offices. Fa- f~her information, contact M-. Gary McArth\.l'" at (512) 908-1917.

Persons wbh disabil~ies who have special communication a- other acconvnodalion needs who are plaming to attend the hearing should contact the agency al (512) 908-2245. Requests should be made as tar in aclvance ,,_. The amendments are proposed under the Texas Health and Salely Code, the Texas Clean AS Act (rCM), §382.017, which p-ovides the TNACC w~h the authority 10 ~ rules consisleol with the policy and ptxpOSeS of the TCAA.

§/I6 ./IO. Applicability.

(a) Permit to construct. Any person who plans to construCI any new facility or to engage in the modification of any exisling facility which may emil air contaminants into the air of this state shall obtain a permit pursuant to § 1l6.l11 of this title (relating to General Applications), Sillisry the conditions ror a standard permil pursuallt 10 tlte rl'quirt'mt'llls in Subchaptt'r F of this chapler (relatiui: 10 Siandard Permil!!), Of satisfy the conditions for exempt facilities pursuant to Subchapter C of this chapter (relating to Permit Exemptions) before any actual work is begun on the facility. Modifications to existing permitted facilities may be handled through the amendment of an existing permit.

(b)-(e) (No change.)

§//6./15. Special Prov!sion.J. Permits. special permits, stitndard permil!!, aocl exemptions may contain general and special provisions. The holders of permits, special permits, standard permits, and exemptions

shall comply with any and all such provi. sions. Upon a specific fiocling by the Executive Director that an increase of a particular pollutant could result in a significant impact on the air environment. or could cause the facility to become sub..iect to review under the undesignated heads of this subchapter relating to Nonattainment Review or Prevention of Significant Deterioration Review, the permit may include a special provision which states that the permittee mUSI obtain written approval from the Executive Director before constructing a source under a standard exemption or standard permi!.

ThiS agency hereby certifies thallhe J:)'oposal has been reviewed by legal counset and found to be within the agency's authority to

""""'. Issued in Austin, Texas. on November 3, 1993.

TRD·9331""7 Mary Ruth Holder Director, Legal DlvIslon Tens NlIlural Re60Urce

eon.ervatloo eomm....., Earliest possible date 01 adoption: February 1, 1994

For '''''her inlormation. please eal: (512) 463·8159

• • • Subchapter C. Permit Exemp-

tions • 30 TAC §116,21J

The amendment is J:)'oposed under the Texas Hea_h aoo Satety Code, the Texas Clean ~ Act (TCAA), §382.Q17, which J:)'OVides the Texas Natll'"al ReSOll'"ce ConservatlOl1 C0mmission w~h the author~y 10 adopt rules con· sistent with the policy and purposes 01 the TCAA.

§//6.2f1. Standard £r:emptiuIJ U;,t.

(a) Pursuant 10 the Texas Clean Air Act (TCAA). §382.057. the facilities or types of facilities listed in the Standard Exemption List, dated October 13, 1993 (July 16. 1993}, as filed in the Secretary of State's Office and herein adopted by reference. are exempt from the permit requitements of the TeM. §382.0518. because such facilities will not make a sigmficant contribution of air contaminants to the at· mosphere. A facility shall meet the following conditions to be exempt from permit requirements:

(I) (No change.)

(2) Total actual emISSIons au· thorized under standard exemption from the proposed facility which IS located in a nonattainment area shall not exceed:

(A)-{C) (No change.)

• Proposed SectiOIlS

(D) in an ozone nonaltainment area. the applicable major modification threshold of IVOC Of"] NO in Table I of the definition of "major mod'ification" in §116.012 of this title (relating to Nonattainment Review Definitions).

(3)-{6) (No change.)

(b) Notwithstanding the provisions of this section. any facility which constitutes a new major source. or any modifica· tion which constitutes a major modification under (the FCAA,j nonattainment review or Prevention of Significant Deterioration re· view as amended by the FCAA Amendments of 1990. and regulations promulgated thereunder, shall be subject to the requirements of §1I6.11O of this title (relating to Applicability) rather than this section.

(cHO (No change.)

This agency hereby certifies that the p-oposal has been reviewed by legal counset and found to be within the agency's alAhor~y to .,,,,, Issued in Austin, Texas, on Ncwerrbef 3, 1993.

TAD·9331448 Mary Ruth Holder Dir&aor, Leg.aI DivISion Taxas NalUral ReBOlltce

""""'CommiBllon

Proposed date of adoption: Februwy 1, 1994

For IlI1hef inta-mation, please call ' (512) 463-8159

• • • Subchapter D. Permit Renew-

als • 30 TAC §116.311

The amendment is J:)'oposed uooer the Texas Heahh and Safely Code. the Texas Clean A¥ Act (TCAA), §382.Q17, which provides the TNACC w~h the alAhor~y to adopl rules con· slStent wilh the policy and PI.J'"POSeS 01 the TCAA.

§1I6.3/1. Permit Renewal Application.

(a) (No change.)

(b) The TNRCC shall review lhe compliance history of the facility in consid· eration of granting a permit renewal. The compliance history review shall be con· ducted in accordance With the undesignated head in Subchapter B relating to Compli. ance History. In order for the permit to be renewed. the application shall include infor· mation demonstrating that the facility is or has been in substantial compliance with the provisions of the TCAA and the terms of the existing permit. If the facility has a history which demonstrates failure to maintain substantial compliance with the provi· sions of the TCAA or the terms of the ex.isting permit. the renewal shall nOl be granted. (U the facility has any unresolved

NOI'ember 9, 1993 18 TexReg 8147

Add. 18


- ------ - ---- ---- ----------~ --

nonclerical violations of the lNRCC rules. the renewal shall not be granted unless the facility is brought into compliance or is complying with the terms of an applicable board order 0( court order prior to the elqliration of the permit as identified in subsection (c) of this section.) If it is fonnd tlillt violations in the compliance history constitute a recurring patlern of egregious conduct which demonstnltes a consistent disregard for the regulatory process, including railure to make.ll (inlt!ly and substantial attempt to cOlTeel the violations, tilt renewal shall be dellied. If a contt:!lted case hearing has not been called. then the staff must notify the applicant of tilt intent to recommend denial and state lilt basis of Ihe lindillgs. The a pplicant will be given an opportunity 10 respond 10 the notice. If the lindings reneel a pattern of disreg'"rd for applicable regulations which do not warrant denial, additional conditions may be placed in the pernlit.

(c) A permit holder that fails to submit an application for review and renewal within 90 days after receiving notificalion from the TNRCC pursuant to $Ubsection (a) of this section will cause the $Ubject permit to expire. unless the time period for the submission of the application is extended by the Executive Director. Permits are subject to the following renewal schedule.

(I) (No change.)

(2) Any permit issued on or after December 1. 1991. is subject for review every ten [five) years after the date of issuance.

(3) For uuse, a permit issued 011 or arler Det:ember I, 1991, for a facility at It lIonfederal source may contain a provision requirilll: the permit to be reonewtd at a period of between five and ten years. This agency hereby certifies that the proposal has been reviewed by leoal counset and IoI.nd to be within the agency's authority to -. Issued in Austin. Te)[8$, on NovelTtler 3. '993 TRD-8331449 MaIY Ruth Holde!

Dlrldot. L. DiY_ion T.~ NUl,aI Rnoun:.

""-'""'" Coo" ..... " Proposed elate of adoption: February 1. 1994

For IlI1hef information. please call: (512) 463-8159

• • •

18 TexReg 8148 NOllember 9, 1993

Subchapter F. Standard Permits • 30 TAC §§lI6.610. 116.6 11 .

116.614, 116_617

The new rules are proposed tnter the T e)[8$ Healh and Safely Code (Vernon 1990), the Te)[8sClean Ai" AcI (reM), §382.017. which provides the lNACC with the auihorily to adopt rules consistent with lhe policy and jUpOSes 01 the TCM.

§116.610. Appliwbilily.

(a) Pursuant to the Texas Clean Air Acl (TCAA). §382 051. projects involving the types of facilities or physical or operational changes 10 facilities which meet the requirements for a standard permit listed in §116.617 of this title (relating to Standard Permits List) are hereby entitled to the standard permit; provided. however. that:

(1) Any project which results in a net increase in emissions of air contaminants from the project other than those £0(

which a National Ambient Air Quality Standard has been established must meet the emission limitations of Standard Exemption 1000c) or (d) or Standard Exemption 118(c).

(2) Construction or operation of the project shall be commenced prior to the effective date of a revision to §116.617 of this title. (relating to Standard Permits List). under which the project woold no longer meet the requirements for a standard permit.

(3) The proposed project shall comply with the applicable provisions of the Federal Clean Air Act (FCAA). §lll (regarding Federal New Source Performan:;:e Standards) and §112 (regarding Hazardous Air Pollutants).

(4) There are no permits under the same Texas Natural Resource Conservation Commission (lNRCC) account number that contain a condition or conditions precluding use of a standard permit or standard permits under this subchapter.

(5) The owner or operator of the facility registers the proposed project U\ accordance with §116.611 of this title (relating to Registration Requirements).

(b) Any project which constitutes a new major source. or major modification under the new source review requirements of Pan C (Prevention of Significant Deterioration review) or Part 0 (nonanainment review) of the FCAA and regulations promulgated thereunder shall be subject to the requirements of this rule.

(c) No persons shall circumvent by artificial limitations the requirements of this rule.

(d) The emissions from the facility shall comply with all applicable rules and regulations of the lNRCC adopted under the Texas Health ~ Safety Code. Chapter

Texas Regisler •

382. and with the intent of the TCAA. including protection of health and property of the public. and all emissions control equipment shall be maintained in good condition and operated properly during operation of the facility.

(e) All representations wilh regard to oonstruction plans, operating procedures, and malcimum emission rates in any registration for a standard permit become conditions upon which the facility or changes thereto shall be oonstructed and operated. It shall be unlawful for any person to vary from such representations if the change will affect that person's right to claim a standard permit under this rule. Any change in conditions such that a person is no longer eligible to claim a standard permit under this rule requires proper authorization under this rule. The owner or operator of the facility must notify the TNRCC of any other change in conditions which will result in a change in the method of control of emis· sions, a change in the character of the emissions, or an ifICrease in the discharge of the various emissions. Notice of chan&es in representations must be received by the TNRCC no later than 30 days after the change.

(0 All records relating to the applicability of and compliance with the terms of a standard permit shall be maintained by the permittee for at least two years and made available for review by authorized representatives of the TNRCC. U.s. Environmental Protection Agency, or 10cal air pollution control agencies.

(&) All changes au thorized by standard permit to a facility previously permitted pursuant to this rule shall be administratively incorporated into that facility's permit al such time as the permit is amended or renewed.

§1I6.6J1. Regi.l'fration Requirements.

(a) Registration fO( a standard permit shall be sent by certified mail. retum receipt requested. or hand-delivercd to the Texas Natural Resource Conservation Commission (TNRCC) Office of Air Quality and appropriate Regional OffJce before a standard permit can be claimed. The registration shall:

(1) document compliance with the requirements of this section, including. but nol. limited to: the basis of emission estimates. Quantification of all emission increases and decreases associated with the project being registered, suffICient infocmation as may be necessary to demoostrate that the project will comply with §116.610(b) of this title (relating to Applicability). information that describes effons to t:e taken to minimize any collateral emissions increases that will result from the project. a description of the project and

Add. 19


related process. and a description of any equipment being installed: and

(2) be received by the 1NRCC no later than 45 days prior to the commencement of the project. Work may begin on the project any time upon receipt of written notifICation from the TNRCC that there are no objections to the project or 45 days after receipt by the lNRCC of the registration for the project. whichever occurs rlIst .

§116.614. Standard Permit Feel. Any person who applies for a standard permit shall remit. at the time of registration. a fee based on the estimated capital cost of the project. The fee will be determined as set forth in Subchapter 8 of this chapter under the undesignated head entitled Permit Fees.

§J 16.617. Standard Permiu Li.~ . Pursuant to the Texas Clean Air Act. §382.051, projects involving the types of facilities 01'

physical or operational changes to facilities listed in this rule qualify for a standard permit subject to the conditions stated in 1116.610 of this title (relating to Applicability).

(I) Installation of emissions control equipment Of implementation of control techniques as required by any state Of federal rule. standard. or regulation.

(A) Installation of the control equipment or implementation of the control technique must not result in an increase in the facility's production capacity unless the capacity increase oCcurs solely as a result of the requirement \0 install the control equipment or implement the control technique on existing units required to meet applicable emission limitations. Any production capacity increase resuiling from the installation of control equipment or implementation of control techniques shall not be utilized until the owner or operator obtains any necessary authorization pursuant to 1116.110 of this title (relating to Applicability).

(8) Any emission increase of an air contaminant must occur solely as a result of the requirement to install an emission control device or implement a control technique .

(C) Installation of emission control equipment or implementation of a control technique shall not include the installation of a new production facility, reconstruction of a production facility as defmed in 40 Code of Federal RegUlations (CPR). f60_l5(b)(I) and (c). or complete replacement of an existing production facility.

(D) If the project. without consideration of any other increases or decreases not related to the project will result in a significant net increase in emissions of any criteria pollutant. a person claiming this standard permit shall submit. with the registration. information sufficient to demonstrate that the increase will meet the conditions of clause (i) of this subparagraph.

0) The emissions increase shall not:

(n considering the emission reductions that will result from this project_ cause or contribute to a violation of any national ambient air quality standard; or

(IT) cause or contribute to a v iolation of any Prevention of Significant Deterioration (PSD) increment: m

(llI) cause or contribute to a violation of any PSD visibility limitation.

(ii) For purposes of this rule. "significant net iocrease" means those emissions increases resulting solely from the installation of control equipment or implementation of control techniques that are equal to or greater than subclauses (I) or (IT) of this clause:

(I) the major modification threshold listed in §116.012 of this title (relating to Nonauainment Review Definitions). Table I. for pollutants for which the area is designated as non attainment:

(IT) significant as defined in Title 40 CFR §52.21(b)(23) for pollutants for which the area is designated attainment or unclassifiable.

(iii) Although netting is not required when determining whether this demonstration must be made for the projXlsed project the increases and decreases resulting from this project must be included in any future netting calculation if they are determined to be otherwise creditable.

(E) For purposes of compliance with the PSD and nonattainment new source review provisions of the Federal Clean Air Act. Parts C and D. and regulations promu1gated thereunder. an increase that satisfies the requirements of subparagraph (D) of this paragraph shall not constitute a physical change or a change in the method of operation. For purposes of compliance with the Standards of Performance for New Stationary Sources regula-

• Proposed Sections

tions promulgated by the U.S. Environmental Protection Agency at 40 CFR §6O.14. an increase that satisfies the requirements of subparagraph (D) of thil paragraph shall satisfy the requirements of 40 CFR 6O. l4(e)(S).

(2) Voluntary installation u emissions control equipment.

(A) Installation of the con. trol equipment must not result in an increase in the facility's production capacity unless the capacity increase occurs solely as a result of the installation of control equipment on existing units. Any production CI

pacity increase resulting from the installation of controls shall not be utilized until the owner or operator obtains any nec· essary authorization pursuant to §116.1I0 of this title (relating to Applicability).

(8) Any emission increase ol an air contaminant must occur solely as I

result of installing an emission control de· vicc_

(C) Installation of emission control equipment shall not include the installation of a new production facility. reconstruction of a production facility as defllled in 40 CPR §6O.l5(b)(I) and (c). c.complete replacement of an existing production facility.

(D) IT the project. without consideration of any other increases or decreases not related to the project. will talk in a significant net increase in emissions 01 any criteria pollutant. a person claiming this standard permit shall submit. with the registration. information sufficient to demonstrate that the increase will meet the conditions of clause (i) of this subparagraph.

(i) The emissions increase shall not:

en considering the emissiO!l reductions that wiU result from this project. cause or contribute to a violation of any national ambient air quality standard: or

(II) cause or contril). ute to a violation of any PSD increment: (I

(Ill) cause or contril). ute to a violation of any PSD visibility limitation.

(ii) For purposes of this rule. "significant net increase" means those emissions increases resulting solely from the installation of control equipment or implementation of control techniques that are equal to or greater than subclauses en Of em of this c1a~:

November 9, J 993 18 T"Reg 8149

Add. 20


(I) the major modification threshold listed in §1I6.012 of this title. Table 1. for pollutants for which the area is &.signated as non attainment:

(IT) significant as defmed in Title 40 CFR. §52. 21(b)(23) for pollutants for which the area is designated anainment or unciassifiabJe.

(iii) Although netting is nOI required when delermining whether this demonstration must be made for the proposed project. the increases and decreases resulting from this project must be included in any future netting calculation if they are determining to be otherwise creditable.

(E) For purposes of compliance with the PSD and nonatlainment new source review provisions of the Fedelal Oun Air Act. Pans C and D. and regulations promulgated thereunder, an increase that satisfies the requirements of subparagraph (D) of this paragraph shall not constitute . physkal change or a change in the method of operation. For purposes of compliance with the Standards of Performance for New Stationary Sources regula· liOns promulgated by the U.S. Environmental Protection Agency at 40 CFR, §6O.14, an increase that satisfies the requirements of subparagraph (D) of this paragraph shall satisfy the requirements of 40 CPR, §6O.14(e)(5).

This agency hereby certifies Il"Iat the proposal has been reviewed by legal counsel and Iotrd to be within the agency's atAhority 10 -Issued in Auslin , TeJt&S, on NoverrtJer 3,

" .. TRD-933t450 Mary F\.I1I1 Holder

Dir.clor, legal Dtv~ T.xas N.n.Ir.1 Aesourc.

eon-v.!ion Commiaion

Proposed date 01 adoption: February I , 1994

For ftrlher intormation, please call: (512) 463-8159

• • • Chapter 290. Water Hygiene

Water Saving PeifOimance Standards

• 3U TAC §§290_2SI. 290.253·290.256. 290.260. 290,26$, 290.266

The Texas Nal~a1 AeSOU'ce Conservation Commission (Conull1ssioo) proposes amendrMrlIS to §§200.251 , 200.253-290256, 290.260, 290.265, and 290.266 concerning definitIonS. the plumbing htU"e fist, coroJlions lor removal .. om the list , lees, e~empbellS, labeling, administrative and civil penal.es, resped:JVe~ .

18 TexReg 8150 NOI'cmbcr 9, 1993

Section 290.251 is amerOed to delete the der.,~ions of "'TeJt&S Department 01 Health: the 'Board of Healh: and -Commissioner 01 Health: and provide delinilions lor the "'Texas Natlnll Resource Conservation Commission' and the e~ectA.ive di"ector. The amenclmerts also revise a CtlTent definition 01 the term 'order:

Sections 290.253, 290.254, and 290.255 are amended 10 delete references to the T e~&S Depw1ment 01 Health and replace with appropriale relerences to the Te)(8s NatLW1ll ReSOU"C8 Conservalion Commission. Section 290.254 is amerOed to define the hearing process.

Section 290.256 is amerded to rastrict the e~emption provisions.

Section 290.260 concerning labeling has been changed to include clothes washing machines, dish washing mach~, and lawn sprinklers. LabeMng requi"emenls Ia p1umbing fiJttures and plumbing fillings have been datilied.

Section 290.265 aoo §290.266 are amended to delele reterences to Ihe Texas Department ot Health and replace with appropriale reterences to the Commission.

Section 290.266 is amerded to delete the boc"l:I requi'ement and condition requiring payment 01 an assessed penally by a party seeking judicial review 01 a commission decision.

Stephen Minick, Division 01 Budget and Planning, has determined that lor the trst live years these sections as proposed are in effect, there w~1 be no significant fiscal implications as a result 01 enta-cemern and administrahon 01 the sections. There are no significant ifTl)lications anticipated lor state or local goYernments. Generaly, new (&qui-ements under these sections are consislent with eJtisting state law aoo federal requirements under the Nationat EoorOY Policy Act 01 1992 or the National Appliance Energy Conservation Act 01 1987_ While there are costs associated with compliance with labeling requirements, the specilic provisions pooposed in these sections are not alllicipated to represenl significant add~iooal costs to product manulactU"srs above the costs 01 compliance with eJtisling statutory authority. The extension oIlhe effective date lor the labeling requirements to March w~1 have cost savings implications kJ" manufacturers requi-ed 10 label plulTt:ling fiJtlu"es, but this savings has not been determined.

Mr. Minidl. also has determiled that lor the IirsI five years these sectIOns are in effect the public benelM anlicipaled as a resul: 01 entorcement 01 and cOIllpiiance witll the sec· tions wi. be improvements in consumer awareness 01 the waler usage leat~es 01 plumbing tixlU"es arc:! appliances aoo increases conservation ot ptbIic water supplies. There are no significant implications lor sma. businesses. There are no known COSIS to any persons required to comply w~h these seChOOS as proposed.

Written comments on the proposat may be submitted to James M. Higtbefg, R.S. , Pro~am Manager. Water SavilQ Fixt~e Pro~am, Water Ut~ilies DNision, Te~&S Natural

Texas Register •

ASSOU"C8 Conservation Commission, P.O. BoJt 13087, Austin. Texas 78711-3087. In order to be consicIered. written comments musl be receHed by the Water Utiities Division by 5:00 p.m_ (OST) 30 days aft.- the ptdcation date of this proposal.

The amerdmenis are proposed !Alder the authaly of the Health ard Safety Code, Chapter 372, and the Texas Water Code, §5.103, which authorizes h Commission to adopI and enforce rules necessary to carry etA ~s powers and duties. Former Health and Safety Code Chapter 421 was renurmered as Qlapter 372 IUStJ3nt to Senale Bit 587, Fi"sI Called Session, 72nd LegislaIU"s. efleclive August 12, 1991 .

§290.15J. Purpose. Alillwriry, and DefinifiuIU.

(a) (No change).

(b) Authority. The authority for these 9tCtions is the Health and Safety Code, Chaptel 372 (421]. titled "Environmental (Water Saving) Performance Standards for Plumbina: Fixtures.

M

(c) Definitions. The following words and telms. when used in these 9tClions. shall have the following meanings, u~less the context clearly indicates other

W"'. (I) (No change.)

(2) ASME-The American So-[tely of Mechanical Elli:\neers [Board-The Board of Health}.

(3) COfllmission-The TexllS N<l.tund Resoun:e Conserv<l.tion Comnlission [Commissionel-The Commissioner of Health].

[(4) Department-The Texas Department of Health.)

(4) Executive director-The executive director of the Texas Natund Resource ConservatKIII C(Hllmissiun,

(5)-(7) (No change.)

(g) Modd-A type Of" desia:n of a plUlllbilla: fixture Order,

(9)[(8)) Order-A request to purchase plumbing fIXtures from a manufacturer. major supplier Of importer (with a merchandise delivery date not to exceed 90 days from the date of the request] .

(IOJi(9)) Plumbing Fixture-A sink faucet. lavatOf)' faucet. faucet aerator. shower head, urinal. toilet, flush valve toilet. or drinking water fountain .

( 11 )[(10)] Toilet- A toilet or water closet except a wall mounted toilet that employs a flushometer valve.

(12)[(11)) APA (APTRAJ-The Administrative Procedures (Procedure and Texas Registel] Act. [Texas Civil StatuteS. Article 6252-13a).

Add. 21


RADOPTED ULES

An agency may take final action on a section 30 days after a proposal has been published in the Texas Register. The section becomes effective 20 days after the agency files the correct document with the Texas Register. unless a later date is specified or unless a federal statute or regulation requires implementation of the action on shorter notice.

If an agency adopts the section without any changes to the proposed text. only the preamble of the notice and statement of legal authority will be published. If an agency adopts the section with changes to the proposed text. the proposaJ will be republished with the changes.

TIlLE 22. EXAMINING BOARDS

Part V. Texas State Board of Dental Examiners

Chapter 109. Conduct

Infection Control • 22 TAC 1109.222

The Texas Stale Board 01 Dental E~amioers adopts an amerw:lment 10 §109. 222, w~houI changes 10 the prq:xl5ed text as published in the March 8, 1994, issue altha Teus Register (19 TexReg 1626).

The Texas Stale Board 01 DeoIaJ Examiners finds there is an imminent per~ 10 the pUJIic heanh, sallMy or wellare due 10 lhe IIveat of inlection, hepat~is A, B, and C, and tuberculosis and HIV being passed rom infected dental lab wOf1«M"s 10 denial health care wOl1<ers and dental patients through denial prostheses manutactlnd, repa.red or handled in unsanitlW)' cond~ions or by infectious lab wakers. The rule is pstified by the imminent ellect of the Nath American Free Trade Agreement, resolting in commerce with many denial labs no! stbject to OSHA regulation and no! in ~nce w~h saCl regulation.

Section 109.222 states that when it is neces· sa")' 10 rettn! items 10 a dental offICe tom a dental lab said ~em shaH be rendered non· biohaulrdous belere return to the dentisl by the denial lab or techniciall according to established OSHA guide~nes .

No comments were received regarding adoption 01 !he rule.

The amendm8ft is adopted under Te)[8.s Civ~

Statutes, Articles 4551d(c), 45511: and Texas Government Coda, §2001.O34, which provide the Texas Slale BoM:I of Dental'Examiners w~h lhe authority to adopt and enforce such njes and regulations not inconsIStent with the laws 01 the state as may be necessary lor the performance 01 its duties andlO'" 10 If"lSlXe compliance w~h the state laws relating to the practioe 01 dentistry to protect the ptblic heallh and safety.

This agency hereby certilies thai the rule as a:lopled has been reviewed by legal counsel and IOund 10 be a valid exercise 01 the agency's legal authority.

Issued in Austin, Texas, on Apr~ 14, 1994.

TRD-9439285 C Thomas CA/Tfl Ex4lC:lltlYe Dil9ttor Texas $Ul.1e Board ot

DenIal Examlnen;

Etledive dale: May 6, 1994

Proposal ptbhcallon dale: March 8, 1994

For Il.I1her information, please ca~: (512) 463-6400

• • • TITLE 30. ENVIRONMEN-

TAL QUALITY Part I. Texas Natural

Resource Conservation Commission

Chapter 116. Control of Air Pollution by Permits for New Construction or Modification

The Texas NaIu-a1 Resource ConservatlOl1 Commission (TNRCC) adeps amendments to §116.110, CCJnC6rTW)g Applicability , §116.115, concerning Special Provisions: §1 16.211, concerning the Standard Exemption Ust; and §t 16.311(b) and (c) , concerning Perm~ Renewat Applications. Also, the TNRCC adopts a new Subchapler F , Standam Permrts, containing new §§116.61D, 116. 611 , 116614, and 116.617, to establish a category of standard perm~s . Sections 116.211 , 116.610, 116.611 , 116614, and 116.617 are adc4lted with c:hanoes 10 the proposed teXl as iXbIished in the November 9, 1900, issue of the Texa!; RSQlster (18 TexReg 8145). Sections 116110, 116.115, and 116 311 are adopted without changes and wiD not be republished.

The proposed changes were developed in response to recommendations by the Permits Workshop Task Force and directives Irom the Iormer Texas AX Control 8oc¥"d to streamfine lhe penni! pr0C9SS. The proposed changes 10 the Slandan:! Exemption Lis! consist 01 revisions to Standard Exemption (SE) 75, SE 107, SE 113, and a new SE 124. The proposed revisions to SE 107, regarding vapor del1ease~, and SE 113, regarding thermoset resin ~tions, were recommended by the Office of At Ouality, Permits stall The proposed new SE 124, relaling to auto body ~, and revised SE 75 , relating 10 surlace coating facilities, were developed by lhe Auto ,

Body Shop Task Force 10 provide a means lor the thousands 01 auto body ~ located in Texas to comply w~h Chapter 116 requi-emenls.

The stall requested comments Irom the public and the regulated community regarding penni! lees lor standafd permits. The stall also requested corM\efIlS, particularly from the regulated community and the United States Envronmental Protection Agency (EPA), regarding the requirements in the pr0-posed §116. 61 7(1 )(D)(iil) . This clause alows lhe facil~ies ca.oered by the standard permit to be exckded from netting calculations for the ptrpOSeS 01 Prevenhon 01 Significant Deterioration (POO) 0" nonallainment review.

A pWIic heanog was hetl on December 2, 1993, In Austin and on December 3, 1993, in Houston 10 cooSider the proposed rule changes. Testimony was received from 23 commenlers. The following commenters generalty supported the proposed revisions to Chapler 116 wMh some suggested changes: Automotive Service Association 01 Texas (ASAT); Exxon Company USA (Exxon): Brown McCarroll & Oaks Hartline (Brown): Amoco Chemicals Company (Amoco Chem); Amoco Oil CoiT1>any (Amoco Oil); Texas Chemical Counc~ (TCC): BOts Manufaduring Company (Sinks): H.,-is County Pollution Control Department (Hams County); Phillips Petfo1eum Company (Ph~Iips): Pennzoil Company (Pemzoit): Eastman Chemical Company, Texas Eastman Division (Eastman): Houston lighting & Power Company (HL8p), Texas Utilities Services (TlJ): Chuck's Custom Auto (Chuck): Exxon Chenica! Americas (Exxon Chem): and DuPont Gulf Coast Regional Manulacluring Services (DuPont) The toaowing commenters listed specific concerns without ekher supporting or opposing the ovard proposal: City of Fort Worth (Fort Worth): International Cast Polymer Association (ICPA): City of Dallas AX P~ion Control Section (DaDas): ~e Fab"lCators Association (CFA); Bel1lon & Associales (Benton); and one individual. Galveston/ Houston Association for Smog Preventoo (GHASp) was opposed to the en-11111 p!WOS8l but did oller suggested changes.

The loIIowing discussion 8Ittresses general commel1s lolowed by comments regcrding each specific section proposed lor change.

General Comments. Exxon and Brown suggested that standard penni's should be exclOOed from amen:tments and a1teralions in §116.116(c).

• ADOYI'ED RULES April 11, 1994 19 TexReg 3055 Add. 22


SectiOo 116.116 rof(J(S 10 perm.ted Jac~rtles that propose modlflCflhons which qua~1y lor a slandBrd exe~iOo. Changes in represenlB' tions to a facility which are C<N"ered by a standard permit am addressed in new § 116 610(e). Faci~ties that are permmed aoo make modificalioos covered by a standard permit are actIressod in new §116.610(Q). The pur_ pose 01 requi"ing lhe incorporation 01 standNd permits inlo tullX8 amendments or alterations, which 8I"e relaled 10 a facility previously pem1dtod under §116 110, is to coRact al 01 lhe Chapter 116 aulhorilations lor a pwIicular lacility rno one document ThiS saves lime and conlusioo tor both lhe TNACC and the perm~ holder when renewing permHs, amending permits, dealing wilh c0mpliance arw:l enlorcement mailers, etc

Ph~1ips commented thai Ihefe shotlk:! be no neMing 01 emission changes resulting from emission reduclion proiects requi'ed by rule However, YOIunt8I"Y pro;ects shouk:! atlow nelting 01 the ina"eases and decreases.

The statl has requested commenlS tom EPA regNdJ"ig nettng 01 emissions tom standard permits. EPA guide~nes do not alow reduclions requl"ed by fule to be included in fleMing calculations However, stall has no! feceived any formal writ1en glJidance from EPA on wheUlef ino'eases which may be associaled with these reduclions must be Included in nel1ing calculations. Slall has therefore de' cided lhal illCfeases asSOCialed with the pro/Elct which are used to Oemonstrale compliance With the rule w~1 not be used to trigger nelling klr Ihal prOject as long as the "WEPCO exemption" IS satisfied. Statl ted Ihis position primarily because we recogniled the practical need 10 get lhose projects apprOlled quickly, and netling, especially 81 large lacililres, couk:! lfIYoIYe a great deal of lime and effort on behaM of both lhe awlicant and lhe agency. Atler addihonaJ ioformal disCUSSions wilh EPA, Slatl has also decided lhat none oIlhe emiSSion chanoes associated with protects required by rule shouk:! be included in any nel1iog calculations. The WEPCO language e~empls poiIlIIlOIl conlrot projects !rom the delin~ion 01 phySICal change or change In method 01 operation comained in 40 Code 01 Federal Regulations, §52.21 and §51165. Therelore, changes which satisfy thIS exelll>lion are no! modi~ions aoo do no! have to be Included in any nelling cak:ulalions. Slatl has elected to relain lhe proposed language in Slandard pennil number 2 for volunlary projects. ThiS win aloN QUIck approval for these prOjects and Slill aUON applicants to take credit for lile reductrons in fulure naMing e~ercises. Since aedlt wi. be given lor lhese deaeases, any aSSOCIated in. aeases must also be accounted lor in IlIIlXe netling calculallons.

Penrrzoil suggested a clatificalion 01 how 1M standard permits wiA reiale to ledefal opetating perm~s. There was a queSlion as 10 when lhe prOJisions 01 the Slandard perffilt wi. be Incorporaled into lhe operatJ"ig permit and if standard permh w~t be converted into genefal perm~s. Penflloil commented that inaeases in pro:iudion capac~y under standar"d permrts shouk:! not be restricted if the pro:iudion inaease does not fesuH in an emission increase. In lact, produdron inaeases should be aIIooYed which involve only

de lTW'imis emiSsion inaeases 01 less than one ton per year

Texas has s!rUCtlred its federal opemhng pennit progllIlllaaly separate from the new t.OUrCe review (NSR) permitting process Therelore, there w~1 be no connection between standaro permis, which ore par1 oIlhe NSA perm~ process, and the federal operating permrlS. For lhe same reason, general pennds, which are part oIltre federal operating permit prog-am, w~1 have no link w~h starOard permits. The Dpef"81ing pennk is basically a codifICation pennk which summarizes the recordkeEll*ro requi"ements and lecleral emission standards applicable to a particular" faciI~y and IS requi'ed only lor ma· JOf SOU"ce facilities . II does no! contain all of the special provisions and allowable emISsion rates thai 8I"e in the NSA permit.

The proposed rules do not prohibil produclion increases pl'OJided that there is no illCfease in emissions prior to the ifl1)lementahon ot additional control, change in the character 01 emissions, or change in emission controls. The rules do prohiJiI: changes in construcIion plans, operaling procedures, and maximum emission rates if sllCh changes exceed or conflict with conditions ollhe Slandard permit.

Easlman commented thai pennltting 01 poItulion reduction protects shouk:! be limited to lhe allected on~ only. Plantwide mcdeIing 10 detennine umbranl impacts should noI be requ"ed.

The new Subchapler F does not contain any modefing requrements. However. modeling may be re(JJred where lhe project win resu/l in a significanl nel Wlaease of a a~eria poIlUani. In Ihis case. the person clainling the standard perm~ must demonstrate compli_ ance with the National Ambient Ai" Ouality Slarmrcts, PSO Increment, and PSD visbilily ~mitations. In order to make this demonSlration, the person claimlllg the standard permit may have to perform a modeling analysis. 1/ so, the claimant mustloiON federal ar(j stale modeling prolocols which could fesult in a fequiremenl 10 model the enti'e facility ptus oIher scuces outSide 1M facility.

Dallas quesllOrlec:l the Slalement In the pre· amble regarding lhe eSlimated cost 10 state government 01 $522,000 per year to review staooard exemptions lor aUlo body shops The comman! Iotlowed lhat since lhe agency has ahady been reviewWlg exempllon appIi_ calions, thete shoutt be no added COSIS. DaI· las also CXJmmenled thai conIroi COSIS lor auto body shops may be unalfordabie /of many of the small shc:p owners. It seems In"easonable to requi"e body shop COftrols when ai"aa" retuelrng facililras do no! requi'e controls even wilh more poIential YOialile organic ClOfI1)OIJOd (VOC) reduction

The eslimated review oosts are based on the new SE 124, which w~1 ",ealty lIlO"ease lhe wOOlIoad on agency Slatl it the estm18led 10,000 auto body shops in lhe Slale an submit exemption awlications. Until noN, most 01 the body shops have been Dpef"allng withoul any TNRCC aulhorilation and are poIenlialy in vioIatron ot current rules, so the incluSlOll 01 this SCUC6 category in the rules wYI definitely impact statl resotrces.

The emISSion control costs were consdered by the Auto B<xty Shop Task Force during

19 Te:cReg 3056 April 22, 1994 TeXIJs Register •

developmenl of lhe rule language lor SE 124 The body shop IOduSiry was repesented on the lask klroe, and II assisled in ffilnirru~ the costs of the proposed control reqw-. ments. Comments provided dmng lhe rulemaklng process WQ(e also ulailed to inrimi:zB costs

The statl does not ag-ee w~h lhe assertOl lhat lhere are more poIentiai VOC: emission redudioo$ !rom araaM fefuellng than wom aUlo body spraying operations. The TNRCC is aJlTenlly studying polential conlrol 01 _. eratl refueling emisSions, but has no! yet d&lermined it M is economicaly leasble or it sigl\lficant reductions are even achievable There is very 1it11e simHarity between ai"CfaR refueling aoo auto body spraying opwations. The vapor preSSll'"e of kerosene is much lower than painl sotvellls, so potential emis. sions are moch lower. Mos.I 01 the VOC: ellllS. sions tom ai"aafl occur donng takeo/! and landrng, no! from relueling. tn concluSIOn, the matter of araatl retueling is a separale iSSUI which IS under review and is beyon:;! the scope of the corrent rulemaking proposal.

GHASP is opposed 10 lhe use of Slandan:I permh. There IS concern lhat aM" qualily wil g-a:lually deg-ade because COfll>anies wil no! meet the requremems 01 lhe permll ar1l wi. nol mainlain lhe emissIOn control equipment. There is concern about no public iflluI. no site review, and no review 01 compliance history. Also, GHASP IS opposed 10 lhe use of offsets or nethng as JUSI a paper exercise w'hou! actual emission moortoring.

The Slall has SLqXr1ed starOard perrrils as a means to redllCe lhe backlog 01 perrnl applications thai has cOfll~lUed to escalate 111

recent years Agency stan resources are (111-ited, and standard permds are deSigned to provide a streamlined review process Icr pollulion reduction projects and lor lac~~y types whICh have been reviewed and pennrl1ed or exe~ed on a routrne basis

Duong the development 01 lutlXe slandard perm'S, Ihe stall wiU Slme 10 include specific cond~ions lhat w~1 adctess lhe use of awropriale conttol technology. The pr.blic wi. be able to comment on each starmrd perm~ aI lhe time lhat it is subtect to rulemaking. Although iooiYduai slanc1ard permits are nat slb;ect to public nohce aoo contested case hearing requifemenls , the pr.blic can conlacl lhe TNRCC with concerns a- complaints r. garding lacililies opwating under a Slandard permd . It IS the responsib~rty 01 any perrriI holder 10 compty w~h all rules and regul8l1C1"1S 01 the TNACC. Also, Slandard permits at fa· c~dles lhat have other preconSlructiOn per. mits may be incorporaled into lhe penni l4Xlf1 amendment or renewal . ImpadS trom Ihe permil1ed facilily wiM be evaluated at !he time or renewal

The permits stall evaluates Itre use of radII:' lions as offsets and in performing nel1rng ca~ culallons on a case·by-case basIS. Alhough monitoring is no! required for every case, lhe permits stafl does require cIocumentaliOn thai the reductions are actual emissions. The best available inta-malion is used 10 make Ills determination The Irllormatron ma~ indLde monitoring resu~s, leshng resu~s . operalrng dala, elc.

Add. 23


There were no comments recerved on the ItQPOSEId changes to §1161 10, concerning Appkabilily or §116.115, coocemino Special Provisions. The comments regarding §116.211 , concernWIg Standard Exeft1)llOl'! List , and SE 75, c0ncerning su1ace coalIng operallOOS, are as -. Fat Worth commenled IhIlt conditIOI'! (h) !ihoukt reference Chapter 115 rather than Chapler 116. Condition (j) haS a lot 01 unclear delWl itions lor eodoSed. indoor, outdoor. and nooenclosed tacilities. Forced venlilalion snoukt not be required for ~no operatioos as staled in con;:litioo (j)(2). II w~1 be difficull \0 enforce prer..sure drop reqUirements staled " corditioo (i)(I)(A), unleSS the facility is required to install a pressure gauge. ConditIOI'! (l) should alloW indoor Of enclosed faCilities 10 be IOCluded Ifl lhe exe~hon .

The staff ao;rees that an error was made ., specilying Chapter 116 and has changed the rtllerence to Chapter 115. The stat! b81ieves lhal "enclosed" is c\eaI1y defined in condibon (j) and that the other terms do not need U1her clariliCation.

Forced ventilation was inCluded in (j) (2) since Ihe dip tanks and the df"WIng aOO drying parts have sIQnificani emissions that woukj ((hefwise exil the lacility as lugitives and Itoduce UflIIcceptabIe oil-property coooenlralions . The stat! does not sopport the elimina\JOfl 01 the vertilation requnmenls.

Compiance with the pr85Sll'e drop reqJi"ements in (j)(l)(A) lor the fillers could be demonstrated wMh a pressure lIldicator such as a manometer and many new booIhs atre~ come equiWE'd with lhem It is alsO ncum· benl upon the appIicanl to be able to demonslJaie compliance ..... Mh the reqtWemenls of the exemption even iI a compliance method IS not specified. The staH does nol S~ requiring acttlti>nal monitoring or testing.

Condition (I) a lows many small 0IAd00r and parllaly enclo&ed operations with imiled veotjalion to pertorm coaling operations. The con:!ition is primarily intended to allOW lor smal touch-"" operatlOl"lS and indoor a encloSed areas by defi"utlOll have higher control requi"emeolS as required in condition ID·

Harris County staled thai oondittOll (1)(4) should clarify the mean.-.g of no visiJle emisSIOnS. Does I mean zero opacity or lesS than 5.0% opacity? Also, how doeS the exemption hokter demonStrate the minimum velocity and Itessure drop rB<J.Ii"ements in cordibOn ID1

No visbIe emissions is a qualilative evalua-00n 01 opacity ralher than a quantitalive evaluation with a specified percent opacity based on a nurmer of readings 01181" a time period. In other words, no visible emissions is based on an instanlaneous ob6ervance 01 any emis-

""". The bOOth or work area velOCity in condlbon (j) can be determined th"ough actual velocity 1l'aV8rs9S and measaements, Of it may be Itelerab/y done by calculatIOn Fa CO!TllIiance through calculation, the Iklw rale of the ventilation tan (in etbic leat per minute jCFM» IS divided by lhe tIow area 01 the booth (height l imes width ta an end craft booth). Tl"Ie presSIXe drop C8fl be demoo-

suated with a p-BSSUIll ndiCator such as a manometer as staled ., response to Fat Worth's comment.

Eastman commented thai con:lition (c)(4) should be more speci lic n ldertttying the exclUSIOOS. n alsO suggested the foIoNing: clarity "pounds per hod" on a daily basis" in (e)(2)(i); reviSe (1)(3) to proroe la tacililies that have on-site disposal services by adding the phraSe -or ootil emptying into authorized oosiIe waste management tacilities;" and deleIe the requi"emenl to operate only one outdoor or non-enclosed coating operation in (k)(1) and (1)(1) because muHipIe sources would p-oduce a lower ambienl ~.

The stat! agrees that the oooditions excluded in (c)(4) should be stated more cIeaI1y and the condition has been modified to irdica1e the specilic exclUSiOnS.

The intent of pounds per how Ofl a daily basis in (e)(2)(i) irdicatBS thai the record«Ieping should be based on daily USB 01 coatings and so .... en!. and the number 01 hoIn of operation of coating use dlXing the day. The staft has (evised the p-oposed language to make this -. The staft B(1ee5 to make the suggested change in (1)(3), but the staft notes this change wiH benelil very lew sosces in the state.

The stall disao-ees with the suggestion that more than one source located ouldoors or in a non-encJosed area should be a11owec1 to operale simultaneously. Dispersion modeling performed by the stat! lor a typical sma. SOlI"CB covered by this exemption indicated that there would be significant m..,acts p-ob!ems il fTItlI"e than one source would be operating simultaneously.

Several sugoestions wefe made by Oalas to revise the propooed exempllOll: deline metal· ~ing and metal spraying in concition (b); lad .. lIies that qualify under (c){4) shOUld also be excluded from the reCCJl'd(eeping requi"emaills 01 (8) (2) because 01 lhe Vf6y low consumption rales; explain why lhere is a 60 feel per minute (tpm) minimum velocity in para~ph ID and darily whether the 50 !pm lace velocity applies to the ·all other systems· category; ard clarify p8fCilJaph ID{I)(B) and (i)(2) by inserting the word -vemcar betae the word "flow" Oalas ob;ecIed to the rarTlOIIai 01 site apptOllal in par8(P"aph (I).

The staff has made a darilicalron to condiIlOO (b) thai rnetaliz.ng is actually metal depositiOn or sprayllg 01 melon metal onto 8 ~ 10 torm a coating. The proposed wording could cause some oonlusioo that melallic paints .. e included.

The staff 8g-ees that tacilil:ies CO/8(ed under (c)(4) shOUk:I be exduded rom the recadkeeping requi"em8flS of the exemption and haS made the suggested change.

The 60 fpm velocity requirement is a rellecliOfl of ~iOnai Safety and Health hJrrinistralion and National Fl"e Pl'evertion As5ocialioo reqr.Ji"emenlS lor electrostatiC appkation and is the velcdy at a plane perpendicular to the air flow thai is wlhin the booth. The 50 fpm vatocil:y requirement is a mntmum req.J"emenl lor all booths that have JlIel openings to the atmosphere. This is the

velocity at a plane perperdiCular to the al" IIow thai is al the opening of the booIh. The staff has reovanized tNs ooncIilion to add darfy .. The staff B(1&eS thai the word "vertiCar wouk:l provide hnhar clarificatiOn to the re",hmenls 01 ID and has made the suggested Change.

The staft a~S that the site app-oval requi"ement should be included in cond"lIion (I) and the final rule language has been ,_. GHASP commented thai oorditioos (e)(l ) and (4) shOuld rB<J.Il"e a tiva-year recordkeeping period to coR::De with the five-year compliance Nstory requi"emen\. Condition (1)(1) shouk:I oontan a statement requiring proper storage and disposal 01 materials.

Other rec;ord(eeping requirements in Chapter 116 and cortained n other standard exefl1)tions are based on a two-year period. The staff believes that two years 01 operating reeads is a sulficient time period 101" verityllg or making 8 determination 01 a compliance p-oblem. The tHe-year period klr complianCe Ijstory is a staluto'Y requi"emflnllor obtahl\g a preconstruction perml. The staltAe requires coosideraIion 01 any adjudicated decision or compliance proceeding wilhn five years belora the permit appIicaHon tiling dale belol"e issuing a permit. The two-year recortSkeeping reqlkement is used to verity or confnn a compliance problem; and the five-year com" plianoe hislay period is used to evaluate a company's past enforcement matters to determine it there is a reasonable basis lor denial 01 a permit. The statl SI41IJOI"IS the existing lime hmes aOO recommendS against the suggested change to conditions (e)(1) and (4) on the basis thai two years shOuld be sufficient lor Iisco.'ering aOO confirming a OOffll~ance problem.

Regarding oonditioo (1)(1), GHASP stated thai materials should use proper storage and disposal. This requi"emenl is contained in condition (f)(J) and does not need to be duplicated in (f)(I) .

An IOdrvi:\ua1 commented that the propo6BCl revisionS w~t p-ot-ibiI the us& of VOC conlrol equipmenl to meet the emission limits of the exemption. This appears to contravene the Texas Clean At Act (TCAA), §382.057 . The exemption shl:xAd be revised to allaN controt eqUpment that reruces emissions by at least

""'. The stat! believes that the use 01 VOC control equipment to meet lhe exeft1)lioo wouk:l not be appropnate, si'lce the operation and maintenance 01 the equipment has very limrled eolOrceabiity. By basing the exemption on controlled emissions, there is a much tjgher potential for unoontrolad emissions. The higher the emission potential, the greater the probabi~y lor excessive eO"lssions and toxic emissiofl releases, resulting in ciUzen c0mplaints and poIel1ial health ooncems. The ~taff beieves thai controlled facilities should undergo permit review and has nol incorporated the suggested change.

The oorrmeniS regarcWlg SE 107. ooocerning degreasing operations, are as \oIO¥tS.

• ADOPTED RUl.£S April 11, 1994 19 TexReg 3057 Add. 24


Fort Worth oommeoted that this exerJ1)tion wil be diffICUlt 10 enlorOll. Sections (b)(2) and (3) set pr9SSlH limitations with no requirement to monitor or measu-e. The 0.3 pounds per square inch, Absolute (psia) limitation in (b)(3) is different from Chapter 115, which allows 0.6 psia. With separate requirements b' remote I'8S8I'VOi" units in (b), and cold solvent un~s in (c), it is unciear which one applies to remote reservor cold sotvent lM'IiIs. Fort Worth asked why the total scWent makeup in (e)(6) is less than the other sections. Stbsection (e)(4) is inconsislent with Chapter 115. The ventilatiOn ~i'emerts in (d)(5) and (6) , as wei as (e)(5), appear to be taken from sections 01 Chapter 115 which apply to different operating scenarios which should not be combined.

The slaft disagrees with the inclusion of a requ"em&nI to use test methods to determine the vapor presSlKe of the solvent tor such smalt units . However, the stall has added a reference to §115.415, which requires testing and specifies test methods. The rule requires that testin(1 klr the sotvent vapor pressure be performed, but it appears that if the facUy owner or operator has documentation in the torm of a Material Safety Data Sheet or test results from the solvent St.fJPIier of the vapor pr9SSln of the solvent that this would satisly the test requnment of the rule.

The slaff has reviewed the latest version 01 ChilpI:er liS, which has no specific limits on sotvenl vapor prElSSU'e. The chapter sirrW requi'es certain controls be requ"ed on the unit for specific vapor pressures. Additional controls _e requ"ed if the vapor preSSt¥e is above 0.3 psia lor cokS sotvenl with an exerJ1)tion that allows 0.6 psia if the solvent is not heated above 120 degrees Fahrenheit klr cold solvent units. The 0.6 psia stated in condition (c) is not a limitation, but a trigger tor additional controls. The staff agrees that the 0.3 psia imitation in condition (b) wDI be changed to 0.6 psia b' consistency with Chapter 115. However, the staff has changed the vapor pressll6 and ci-ain area limitations klr remote reservoi' Cleane"" in condition (b)(3) to match the exel11)lion limits in Chapler 115.

There shotJtj be no confusion about remote reservor trlfts being considered as cold SOlvent units. According 10 lhe definition in Chapter 115, cold solvent cteaning is the batch p-ocess of Cleaning and removing soils from Metal SUI1aces by spraying, brushing, flushing, al'ldla immersion wh~e maintaining the solvent below Is boiling point. These units typically have a high freeboard and the scNent s...-1ace is exposed within the degeaser 60 that parts may be dipped or immersed in the solvent, or placed on a rack just above the 6Olvent, and rinsed with a nozzle. These units may hold anywhere trom 20 to 200 gallons of sotvenl. These oots are typically used in manufactlXing operations or in large parts rebuilding ql8rations. The remote reservoir deaners, on the other hanel, usualy consist 01 a smal sink with a sotvent spray nozzle that is manuany operated and mounted on a small, separate reservor. These units typically contain five to 20 gallons of room temperature solvent. They are found in auto repai- Shops or aUlo parts stores and are used for hand washing a few di'ty automotive parts thai are being repai'ecf or ser-

viced. The staff does not believe that any Iu1her clarification is needed in the exefT1)tion.

The stall agrees that the sotvent use ImMs in condition (e)(6) shoUd be changed for consistency with (d)(7) and (e)(7).

The language in condition (C)(4) matches that in the current version of Chapter 115. HowfNer, it does not allow lor a separate eidernal ch.inage faciliy as covered in §115.417. The staff recommends adding an albNance for an external drainage faCility thai is consistent with Chapt&l' 115-

The verCiation requi'ements were based on the limits found in Chapter 115 and American Conference of Governmental Industrial Hygienist's (ACGIH) IndustrisJ Ventilation. The 50 fpmIsquare foot (sq. ft.) requirement is taken from /ntiustrisJ Venti/aJion and proYi.1es enough !low to effectively capttM'e !urnes. The 65 ehn/sq. ft. comes from Chaper 115 and provides an l4lP9I" limil on ai' flow, since !lows above this levettend to Mease solvent loss. The staff recommerm no change to the ventilation requiremeru. of the proposed exempIion.

Eastman suggested revising condition (a)(2) to provide for t&cilifies that have on-sile disposal services by adding the ph-'ase 'or unt~ empIying into aUlhorized oo-site wasle management laciIijies." Solvent makeup staled in (a) (1)(6), (e)(5), and (d)(7) should subtract 'inventory change" tom -gross pllChased" 10 account lor facil~tes that inventory and serviOll thei' own units.

The staH has added the suggested language to coOOilion (&)(2) referencing on-site waste management and darified that sotvent makeup should be based on gross usage minus waste disposal.

DalLas pointed CIA that the stack height 0/ 1.3 limes the building height as stated in condition (d)(6) appears to be an error. Other refer· ences to stack heigtts in the rule are based on 15 times the building height.

The staff disagees that this is an error. The two stack heights included in lhe exemption were based on dispersion mode6ng run by lhe staff. Conveyorized degreaS9f"S have higher emission rates than open top mils and a taller stack was required to provide acceptable impacts.

The comments regarding SE 113, concerning polyester/styrene copolymer resins ~cations, are as folows.

Fort Worth commented that both spraying and nonspraying operations should have the same ~mitations. The &OBtone usaoe limitations shoutt be raised bad<. to the rates aI· lowed under lhe cment exemption.

The staff disagrees that both operations should have the same limitations. Based on EPA AP-42. Coo1lialion of Ai' Pollutant Emission Faders, emissions of styrene are higher for spray application than nonspray application. Therefore, spray application would have 10 usa less resin and gelcoat in order to reduOll styrene emissions 10 levels comparable to the nonspray application.

Harris Courty asked how an exemption holder wouk:l demonstrate compliance w~h

19 TerReg 3058 April 22, 1994 Tem! Register •

the 95% removal etficiency requirement in condition (b)(2).

Similar to other coatings operations where there are partic~le emissions, the awticant is normally requested to p-ovide specifications or a guaraJ1ee from the manufacturer 01 the tyoducts.

Eastman commented that material usage staled in (b)(I) and (e)(t) should Slbtract 'inventory change' from 'gross ptXChased" 10 account klr facilitieS that inventcry and ser· vice their own U'litS.

The staff agrees to revise the description 01 material usage for clarification of the rule.

GHASP commented that the recorcI<.eepi'lg requirement in condMion (a)(2) should be extended 10 we years to coinckSe with the fiveyear compliance history requi'ements In Chapler 116. Conditions (b)(2) and (e)(2) should r~i'e a 98% control efficiency as Best Available ConIroi T ectlnology BACT rather than 95%.

The staH is 0J:4XlSed to the we-yelr !'9ClCIfd<eeping requirement. See the response to the same comment by GHASP regarding SE 75. The $laff is also opposed 10 raising the control efficiency which is beyond lhe scope of this rulemaking. It should be underslood thai BACT is not a requi'ed erieria in standard exemplions, which are by definition insignificant sourOllS.

Both ICPA and CFA were concerned aboU: the restriction 10 daylight operations in condtlion (&)(3) which will limit the abiity 10 com· pete in the marketplaca. They 'N8fe also concemed about the stack height and IIow rate NmMations in conditions (b)(3) and (e)(3). Most shops cannot meet lhese ~mits with the .. existing equipmeJ1. ICPA and CFA both suggested a ~mitalion on the stack concentration lor styrene of 50 parts per milion (ppm) instead of the flaw limitalion. CFA also suggested a 3O-1oot stack height.

The healh eHeets screening level klr styrene was reduced a couple 0/ years ago trom 430 microg-ams per el.bic meier (~) to 215 u~m3. This change was made by the Toxicology & Aisk Assessment Sedion to more aa:u-ately descrbe lhe odor detection level of styrene. The Wrritations on stack height, now rates, and daylight operating hours were aI the reSlAt of screening models thai were made by the P&I"Irils staH to detillTlline the potential an-bient impacts from theonoset resin facilities baSed on the new screening levels: The staff does not believe that any relaxation of these limitations can be recommended without creating a potential of exceeding the styrene screening level. The staff is also opposed to substitution 0/ a 50 wm concentration limitation in 6eu of the stadt heigh! and flow restrictions. Additional modeling would be r&qUi'ed 10 conli'm that the 50 ppm limitation wOlid provide equhlaJeni pr0-tection of the elleds screening level. Also, it would be difflCUll lor most facilities to verify compliance with the 50 ppm requirement w~holA installing expensive continuous monitoring eq~ent. Facilities that are unable to meet the standard exemption can awty for a perm~ which alows for indhlidual case review.

Add. 25


The I=f"OPO'Sed changes to this exemplion wi. only affeCI new or modified laciities thai are not currently alihaized under standard exemption. Any tacilily thai is now operating under SE 113 may continue to operate urder the corditions that existed at tM time the exemption was granted.

The comments regarding SE 124, concerning automobile bOdy shOps, are as follows .

The staff has decicled that it would be inappropriate, within the rules, 10 specify a requi"ement 10 submit a checkIlst. Therefore, the relerence 10 Table 124 is being deleted t"Om conditiOn (a). AlSO, the Permits Division has developed a new simplified registration Form, PI-7-124, to be used by auto body shOps in place of Iha Standard PI-7. Condition (a) will be changed 10 reference the new Form PI-7-124.

Eastman commenled thai coOOition (r) of SE 124 appears 10 allow JY88Xisting facilities 10 quality for standard exemplion authorizalion. The TNRCC shoukt advise lhe regulated community of the aulhorizing mechanism for existing insignificant sources 01 ai'" contaninants thai have 1101 previouSly applied for permil or exef11llion.

Condition (r) is only intended to allow existing facilities a gace period for achieving corrpliance with certain conditions of the exemption. It haS nothing to do with the applicability of the exemplion to existing fac~ities. Any fac~ity which is not grandfathered is reqw-ed by law 10 obIaIn a permit or quality for a standard exemption beIore start of construction. Any such facility that is operatino wilhouI preoonstruction authOrization is in violation of Chapter 116. There are approximately 10,000 body shops operating statewide, and the TNRCC is &wl1i'li that many 01 them do not have a permit or stardard exemption. Whenever tha TNRCC performs an unscheduled investigatiOn at one 01 these facilities in response to a citizen complaint, compliance action is initiated lor any Chapter 116 violation. The TNACe does not have tha stafl or rescuces 10 atler11ll to track down and take enforcement action against aD 01 tha auto body shops across the stale. Many 01 these !acilities are v«y small with relatively insignilicant emissions. Many existing body shops have been authOrized 10 oonstrucI under SE 75. Others have been unable to meet all 01 lhe conditions of SE 75 and have not applied lor a permit due to their lack of knowledge regarding the penrit !=W0C8SS or the need for a permit The new SE 124 has been developed with ir1)u1 t"om &.to body shop owners and operators to provide 8 mechanism lor most of the shops to comply with Chapter 116. SE 75 has been revised 10 speciliCally exclude auto body shops in the future-they must either satisfy SE 124 or etse apply fa a permit. FoltoMng the ,,"ace period stated in condition (r), compliance adion wil be initiated against existing facilities thai still fail to register fer SE 124 or apply fer a permit.

ASAT, Bit*$. ChUCks, aro Berdon commented that the 15,000 cfm flow rate requirement for spray boolhs is not reasonable. Spray booth eq~nt manulad~ers IW" duoe units designed lor IIow rates in the range 01 10,000 10 12,000 chn. It would be costly and impractical to attempt to modify

existing booths to generate the additional flow capacity. Also, the benefits 01 such a move is CfJ8stionable. as existing booth desigO$ appew to pertoom efficiently in capllring and removing paint fumes.

The staff ag-ees with this assessment and has revised the now rate requi'ements to 10,000 cfm.

Fort Worth conwnented that the ex8f1¥ll:ion should not be made retroactive to coyer al facilities. Many existing lac~ities, especially smaD shops, wi. be unabI& to COfI1)Iy with the distance limitalions and ventilation requireme .....

The exemption contains different emission control requirements depending on the capacity 01 the shop. Therefore, smaller shops which would have fewer capital resources, are allowed to operate with less controls. Also, the smaller capacity ShOps would gen· erate )ower emissions just by the fact that the use of coatings is less. The staff believes that existing shops will have sufficient time to implement the cor4rol requirements.

Harris County stated that lacililies qua~tying under condition (b) shoukI also be required to meet the requi"ements lI1der (c). Harris County requested clariticalion ot the meaning 01 no visible emissions in (d).

The staff s'-"POfts the recommendation of ncluding good housekeeping requirements from condition (c) fOr SOlI"ce5 exempted under condition (b):

No visible emissions is a qwUtal.i'Ie evaluation of opacly rather than a quantitative evaluation wUh 8 specified percent opacity based on a number of readings over a time period. In other wads, no vistlle emissions is based on an instantaneous ooservance 01 any emissions.

Chuck was coocemed about the distance limilation. ChLd< requested that condition (I) be revised by elirninaiinO the "a other structlft" ptwas& wilh regard to how dose a body sh~ may be located to its neighbOrS since it is 100 restridive.

The stafl alJl!&S that the wording as !=WOo posed is too restrictive and has made the distance restriction ~ only to specified ,_. Dallas suggested several changes to the exemption. Sibsedion (b) should sellhe limit aI one pint per hoI.I'" rather than 112 pirt. Dalas questioned the lime frame lor the nine squll"e toot lirnilalion in subSeCtion (I). A C8Jbon adsorption system shoukI not be required in subsection (f)(2) lor small IaciJlies when it is not required lor larger facilities. &bsection (h) should allow electrostatic spray (J.m it usage is less than one pint per hour. Dales requesled clarilication as 10 whether electric heaters are allOWed in subsection (j). Condi· lion (k)('3) may be too restrictive lor campiance by exisllllg facilities. The tist 01 coating cateoorias in condition (0) should be better defined.

The stafl lllJlIes thai the options lor low usage iacililies shouk:I be somewhattroacler. A secon:l category which specifies a maximum 01 !'NO gallons per week wi. be added to condition (b) 10 !=Wovide more llexibility.

ThEi time frame lor compliance with al of the conditions of this exefll)tion wi. be listed fl condition (r).

A carbon adsorption system is not specifically required in cordilion (I). The condition states thai IF one is used it shall be mainlained property.

The staff does not support the change 10 condition (h) for the use of alectr05talic application eq~nt. The exemptiOn as written alOws for the use of electrostatic spray eq~ men! regardless of the hou1y use rate with a minimal de.-nons8"ation 01 transfer efliciency.

Language haS been added to condition (j) 10 clarify that electric heaters are not: prohibited.

ConditiOn (k)('3) was included in the !=Woposed exemption to protect the public in hilly lerrain Irom acfyerse health elleds, since the stad< haight requirements were based on dispersion models run using simple terrain. ShOps that camet use the!=Woposed exerflJl.ion need to pass through a permit review and more detailed modeling to inslft that public health is !=WoIected.

The coating categories used in condition (0) are based on the definitions found in Chapler 115 for auto refinish products. The staff befieves that no I~her definition is necessary.

GHASP suggested several changes to the proposed exemption: condition (c) sholAd atso require thOse liquids to be stored in covered containers; condition (f)(2) should require covering or encIosu'e to avoid degas· sing from the activated carbon; each coaling category in condition (0) should specify the ooits; a flYe-year recordkeepinQ period should be required in condition (P) to coincide with the tHe-year COlJllliance history require'

~". The staff supports the proposal to requre covered containers too iquid waste in cordition (c).

Covering a enclosing the activated carbon relerenced in (1}(2) is impractical, since it is in the tmn of carbon panels which are in the exhaust dud 01 the ~paration stations. The statl does not ~ this change.

The units tor eaCh coating category in condition (0) 8(8 gaDons per month.

The staff is owosed to the tive-year recordk&eping requi"emenl. See the response to the same comment by GHASP regarding SE 75.

The comments regarding §'16.31', cooceming Permit Renewal Applications, are as 101-

""'. Exxon requested an el!J)lanalion in lhe !=Weamble lor the meaning of the ptrase "'lor cause" in the new §116.311(C)('3).

The use of the term "lor cause" in the !=WOposed rule echOes the TCAA, §382.055(a)(3). While it is not possible, a necessa:y, to Dentily a~ possible situations in which the TNACC might limit a permit's term, we !=WOo vide the lOIowing generic situations to b Irate o~ understanding of the legislative intent. F"1I"st , the lNACe migtt be issuing a permit fimed so that a major regulatory dave!~ment (promulgation ot an EPA rule that wi. aHect the facility or development 01 a new

• ADOYTED RULES April 22, 1994 19 TexReg 3059 Add. 26


TNRCC poky on certain processes, lor ex, a~) is scheduled to ocax belen the expiration ot the usual permM tann. Secord, a particular laciI~y may have a negative CQnl)ianee history which suggests lhal !he operalor's maintenance efforts are not acoeiHbIe. If1 thai case, a shOOer permit term could prCHide tho TNRCC a mechanism 10 review maintenance ellorts in addition 10 standard enforcement options. In addition, certain types 01 prcx:ess equipment may be mae prone to technical performance ck9adation, such as 9CJ.Iipmef'It which operates aI high tefT1)Oratu-es Of pressu-e5.

Amoco Oil commeoted that COfTlliance history shoukl be used as a basis to determine whether existing emission controls are acoept:abIe gwen the age of the lacility. No addtiooaI controls shoukl be requi'ed al renewal if compianoe history and mpacts are

~-. SectiOfI 116.311(8)(4) contains the requAmen! thai in order to be granted a penni! renewal the lacilly ~ use ,ha1 control technology delennined by the Execuive OireclOf to be ecooomically reasonable and technicaly practicable consktering the age 01 the faciity and the iqIaCI 01 its emissions on the SUTounding area· Afthough no! requiring BACT, lhis pwagraph does requte a review of control technology 10 evaluate whether it is reasonable considering the age of the facility and the impact of its emissions. In those ~mited cases where additional COI'trols have been requi'ed aI a facility dt.ring permit renewal, the requirement to add the controls was either because the ~ from the emissions were not acceptable, or because the staff delennined that the additional con· trois were reasonable wilh consideration given 10 ttle ago 01 lhe faciliy.

Fort Worth commented thai the ser1l:eooe in §tI6.311(b) that is proposed lor deletion shoukl be relained. A facility lhal is out ot compliance should not be lIJWIIed a permit.

The r.roposed Changes resulted tom instruclions 10 the staff from the former Texas IW COOroI Board (rACe) at the Augusl 23, 1993, Board meelWlg to revise the c0mpliance history requi-ements lor renewals. A special Permits Workshop was oonducIed on J.-y 26, 1993, to resohfe concerns over the compliance history requirements for permit renewals that were raised al the July 16, 1993, Board meeting. The p!"q)OS8d lan, guage resuled "om that workshop.

The new language proposed to be added to this section still oonIaiRs provisions lor denial of a permit renewal. The new language is more specific in staling the basis lor denial.

Dallas exp-essed strong opposition to the prop:lSed language in §116.311(b) as being very nebulous. Dallas and GHASP c0mmented that there are 100 many undefined lerms thai w~1 compicate the enlorcement process. GHASP is also QAXIS8d to lhe lenyear renewal cycle in Slbsection (c) and fa, VO'S a live-year renewal.

As stated previously in the re5pOll$8 to Fan Worth's comment, the changes to lhis section resulted frOm a special Permits Wattshop that was ordered by lhe TACB. A 101 ot the teons used in enlorcement are legal terms.

Since ~oce action typically involves lawyers, these terms are generaly UlderskXXI by the parties invotved in the action. Writing definitions could se\liH'ety ~m~ the ability 01 the TNRCC to resolve soma ot the enlorcement matters, which can become very complex and diverse Some violalioos are very serious in natu-e and others are not, so llexbiity is needed 10 deal with the variety 01 situations that occur, The staff lavors retaining the prqx!Sed ~.

In response to 1M comment by GHASP regarding the ten-year renewal cycle, this is an existing slat~ory requi'ement, The proposed rule change wi! merely adqlt rule IaI1\P.l808 tnal is consistent with the statute

The comnents regarding §116.610, concerning Aflplicability, ... as loIows.

Exxon oommerli!d lhat subsections (a)(I) (5), (c), (d), (e), (I), and (g) in §11S.SIO appear 10 be general conditions thal should be located in a new section tilled "General Conditions" rather than part 01 the a~l~y section.

The staff agrees that most of lhe items in §116.610 do not relate to appIicabilMy, but shoukl be considered conditions lor obtaining a standard permit. However, the Texas Reg· ister does no! aIow a new section number to be adopted without being proposed. Therelore, §116.610 will be retitled "Applicabil~y and General Conditions" to provide some dariflC8lion. Creation of a new section to c0ntain the general conditions wil be considered in Mure rulemaking.

Exxon, Brown, and Exxon Chern commented that §11S.610(a)(I) should be revised by deleting the wads "project which results in a" to clarify thai the applicability is to lhe emissions inaease and not the project itsell. Exxon, Brown, and TCC suggested that this sWsection shoukI be moved to §116.617(2) so lhat inaeases of toxic emissions requi"ed to compfy with SE 106 and SE 1 18 will only apply 10 voluntary emission reduction projed:s.

The TNRCC does not pennit emissions, it permits lac~ities and physical Of operational changes 10 facilities. The appIicabi6ly 01 this rule is to the project, mearing the lacility or change to the laciity as outlined in §116. 610(a), not the emissions increase. The stall believes that IheAJ shoukl be some protection of the envi'onment against increases of loxic emissions tom al S1andard permits. In lieu 01 evalueting every possible scenario prior to proposing a 51andard permit, the staff has elected 10 include this requirement as a general condition applicable to both standard per· mb. Staff also realizes lhal there may be specific duations where this requi'ement may not be necessary. Staff has Bg"eed to consider thiS in ltAure rulemaking. Two possible slilndard penms which statl has agreed to consider are !of CFC slbslitutionS and changes required by the fedeml TIlle 3 maximum acnevable control technology Slan-

"""". Exxon Chern soogested adding a ptyase, for darifica1ion, a1 the erd of §116.610(a)(4) which reads "in order to prevent inC'eased emissions at a lacility of a particular chemicel of concern,"

19 TaReg 3060 April 22, 1994 Tema Register +

The 51atl believes thai the addition 01 this ptrase 'NO.JId imply thai if lhera is no increase in emissions of the particular poIuIani ItI

question, a standard perm~ may be darned even though an exisling NSA perm~ specifically prohbits a Slandard penni!. " a parmi contains such an exclusion, it IS geoefaly \0 flag a poIentlSl ~cts concern lor lime changes at the facility The stall is opposed 10 Ihis suggested language

E~xon and Brown commented tI1aI §116.S1 0(b) shoulcl replace the aos...g phase °of this rule" with the ptrase 'ot §116.110 01 this tille" rather than '\his Subchapter F."

The statl agrees thai lhe language is cleanv if §IIS.11 0 is specified and wiD make this -. Brown, TCC, and DuPont sugoested thai the meaning of §IIS.S10(e) should be clarified. Brown suggested adding lhe phrase 'as compared 10 Ihe representations in Itle r8glSlfa' tion" at the end 01 the second to las! seotence This wiM establish a benchmar1l to delerminng whether or not a change in rep-IIsentalions wiK cause an emissions increase

Statl alJ"ees to the suggested change wMh minor rewm:ling as \oIows: "as comp8fed to the representaliOns in lhe original reg:istrallon or any previous notification ot a change in representahons .•

GHASP had sevel'al comments abOIJ §116.610 Standard permits do not JlI"(Wde for case-by-case BACT review. No changes in representations shoukl be aIowed in SIbsection (e) without review by the TNACC and j)lb1iC iflllll. Recordkeeping requi'ements m stbsed:ion (I) should be lor five years to track compliance history reQui-ements.

II is true that stafldard permits will not indl.de a case-by-case BACT review lor each perm(. The pupose 01 the lirst two starnard pemt6 IS to s~ily and accelerate the permit rlMew process lor poIluhon ,eduction t:r0jllds These two standard permits contain specific conditions which limit applicability. FUltSe standard perm~s may target specific irdus· tries a types of facilities and wiD also conIaJn sp8C1lc coOOiIions and requi'ements that lhe cq:picanl w~1 have to meel in order to quaily lor the standard permit. These IuIlI'e standard permits may incU:le the reQuirement that lhe lacilities utilize best available conIrot technology. The pt.bIiC w~l have an oppcJIunity for comment during the rulemaking JJ"D" , .... The changes alla.ved urlder §1 16,810(e) are very limited. Section 116.61 0(e) does not 170-hbit changes in representations p-ovided that lhere is no increase in emiSsions, change an the character of emissions, or change III emission COllb'OIs. II does prohibit changes in construction plans, operating procedll'es, and maximum emission rales il such changes ex· ceed or conflict with oondiIions of the SIandard permit.

The staff is opposed to changing subsection (I) to a live-year recorcll.eeping requirement See the response to the same commenl by GHASP regarding SE 75.

Dallas commented thai the pr~ wo-tling of §118.S10(1) would allow an applicant to

Add. 27


discard a1t records, indu:ling lhe parmi! and application. Operalional records should be mamained lor a lwo-year roling average an:! an other records should be retaUled perma· nel1l1y.

Unll\e a p-econstruction permit , lhere is no doaJment or permit certilicate issued on a stan:lard peom. The appliCant is requi'ed 10 register lor am document that it COfI1lIies with the conditions 01 the permit as stated in the rlAe. The TNRCC reta-1S copies of the registrationS both in Austin and the regional oIhces. The rule languaoe has also been changed 10 require the awficanl 10 send a oopy ot the regislrahon to al tocaI programs with jurisdiclion. Wlh regard to operal.ing reo cordS, it is urJ'easonabie 10 require a fac~ily 10 retain these recordS forever The slaff does agree to revise lhe language in § 116.61 O(f) to clarity that the recordteepiog should be on a two-year "rolling" average.

The comments reoarding §116.611 , concern· ing ReoiStfation ReqUll'emenlS, are as 101· ..... Exxon suggested a reviston 10 §tI6.611 (a)(2) to e~mina.te the 45-day waling period and allow construction to commence I4Xlf1 mailing 01 the standard penni regislral.ion. Alerna· tively, it suggested that the TNRCC tie the 45 days to beginning of actual conslructtOll , which is tess nebulous than commencement 01 construction.

The wording used in §116.611(a)(2) is "com· mencemenl 01 tho project: This wordiog was chOSen because there may be P-otacts lor which a standal'd penni! is used which do not ~e 'construction;' lherelore. the staff does not atiree that the wording should be changed. The staff also believes that lor the type of projects oonIefl1)lated by standard permits 1 and 2 , some oppor1unly tor p-iOr review by lhe staff is necessary. Durlflg inter· nat dlscUsstons regarding possbIe Mile star.:!ard permits, the staff has disrussecllhe possibility 01 not requiring lhe 45-day period lor prior review 01 certain of lhese luture standard permits. The staff wUI consider ""hether 10 change this requi'emenl trom a genE!f1ll condition to a condition specific to only ceria" standard permits in futile rulemaking.

HilITis County commented that the reglStra· tion required in §116.611(a) should also be senl to any afleded tocaI p-ogram. Pemu.OiI suggested sending the regeslralion only 10 the ceotral office

The staff agrees that the tocaI p-ograms shOuld be kepi apprised 01 the e)lislence 01 standard permits 10 avoid unwNranted en· Iorcement actlOllS. The rule language has been revised 10 include lhis pfa.-ision. The staff does not agree that the regional ollices should be e)lc1uded from notllicalion

GHASP is opposed to §116.611 on the basis thatlacaities may be constructed w~hout ptbit ifllUl, hearinglS, or TNRCC approya! .

GHASP repeated its general opposition to standard permits in the general comments. The staft response is the same as it was to \he generat comment.

The oommenlS r"9llfdino §116.614, concernno Standard Permit Fees, are as Iolows

DuPont, TCC , ar.:! Brown suggested revISing §116.614 by deleting the words 'applies tor'" and substituting "claims" to elimttlale the p-e· w~ion 01 preapp"oval reqUll"ements

The sla" agrees w~h this comment and has made the suggested change

In response 10 a SOIicitaliOn lor comments reoarding lhe p-oposecI lee struct .... e in the preamble, Brown, Exxon, and E:uon Chern have al stated that there shOuld be no tee lor standard perrTllts. The argument is that the level 01 stat! review IS comparable to stBldard exemptions which assess no lee. It the stat! decides to include the tee, • should be a ffilnimal Ual Ieit

Seven commenlers responded 10 the perm~ lee issue by suggesting a mirtimum tee. AtnocoOil, TCC, Fon Worth, TU, and DuPOI1 suggested a minimum IIat lee without specily· ing what !he amount should be . Philips sug· gested a ftaI lee of $200 and HlAP suggested a nat tee of tess lhan $450. Justllt-. cations lor the nat tee included the comments that fewer agency reSOlSOes are needed 10 review slanctan:l permits versus regular per. mits. and cap~al based tees are ioappropriate because no BACT Of mpac!S review is per. famed.

The stan appreciates lhe commenlS received in response to this issue. 51all al1ees lhat the amount 01 agency re5OU"ce5 needed 10 review standard permits is less than regular pennits and tllerelore is changing the lee to a flat lee of $450.

The comments regarding § 116.617, concerning Standard Permits Ust , are as Iolbws.

EPA Region 6 responded 10 lhe TNRCC solicilalion ot comments in lhe proposed rule p-eambie regarding Mure netting calculations lor emission control projed:s lhal quality lor a starw:lard permit. EPA Region 6 supporIed the p-oposal to deter netting calculations for the IacUjes covered by the s1arw:lard pennit, t:U 10 indl.de those emission increases ar.:! de· aeases associated with the standard permit in any Mile netting demonstration. SI.bse· quent discUSSionS with industry and EPA 01· rlC9 ot Air Cluality Planning and Slandatds caused the staff 10 revISe the nelling require· ments for prOjects reQlNed by rule as indio cated in the respoose to Philips' p-evious genefal commenl. EPA commented on the p-ovisions 01 §116.611 , which allow a tacility to commence construction upon wr~ten notdi· cahon from the TNRCC , or 4S days after rec8tp1 01 lhe registration, whichever OCOJI"S lirst The public record should adaess any p-ocedll"es lhallhe TNRCC wi. i~ment to ensure timely and etleclive revlBW 01 the standard permil regIStrations. EPA also commented that §116.617(1 )(D)(i~(t) an::I (2)(D)(i~(I) should iOcIooa emissions of poIlut· ants which life p-eclXSOlS to the p-imary pot.

"' .... Stat! has every intantion of reviewNlg aW 01 the standard permit regislralions" with.., the 4S-day time trame. illhe 45-day lime period 9xp11"es withOUl agency review, INl applicant is tree to be~ tile p-o;ect. However, thIS does not. mean that the agency agees that the applicant maels the condihoos 01 the standard permit The agency would stal be tree 10 lake enlorcemenl actlOfl agBlnst the

appIica.nI if it is later determined that lhe ~OjE!d began wdhout the applicant meeting the cor.:lJttOlls 01 the standMi permit Tlis is sim~ar to the QXfenl SltualiOfi with standard exemptionS. exceplthat the stafl believes that because 01 the poIentlQlfor a l1eat variety 01 prcject types under" lhe f.-st two p-oposed standard permits a 45-day review period IS

necessary.

Staff agrees w_h EPA's comment coocermog precu-sas and has made lhe suggested changes.

Eu on comrnented lhat, in §116.617, any of the conditions in the two standBld penmls thai. are considered to be oenerat coocWon& thai. wil be used III oIller standard permits, should be ma.-ed 10 the general concIliion ~st. Also, I suggested lhat ttJ6 TNRCC revise lho wortWlg In §116.617(1) by substituting '0 comply" instead of "required by" and Slbstl· lute "fequirement" lor "rue, slandan:i , Of re(pJ·

tatien."

The cooditlons in starnard perm~s I and 2 are only appicabla to emission reduction p-oject&. As more star.:!ard permlls are added to lhe is! in the IutUfB, each wdl have specitic conditions a"ac~, but not. necessar~y any of the coro~1OI1S Ifam standard permits 1 and 2. No action is necessay III regard to lhis comment..

The stat! does not. see a need 10 revise the wording in §116.617(1)

Exxon, Brown, Amoco Chern, Amoco Oil, Eastman, and HL8.P commented that the prohibition against p-oduction inaeases in §116.617(I)(A) and (2)(A) should be reo moved. The SUggestlOflS ranged trom delet· illg both stbparatiraphs entrely, deleting the second sentence trom each ~agraph, Of revJsing the sl.bparB1J"aphs 10 alow produc· tion inaeases lhat occur solely as a fesuft of implementing the controt measures There was a generat consensus thai indus!ry should not be penalized lor p-oduCilon inaeases that can be achieved With emission reductions AlsO. according 10 HL8.P, there is no mecha· nism in Chapter 116 lor authorizino p-oduc· hon increases U181 have no related emission lIlQ"eases.

In general, the staff does not. al1ee with these comments. The NSA p-ogram stan have his· torically toOled at whether an inaease in produdlOO '11111 resuft in an iocrease in emlS' sions prior to Ihe implementation 01 any addj.. honal controt. The p-imary reason lor this is Iha! it 'lie were to look at whether there has been an incfease in emissions (a moctilica· tion) only after the addition 01 controls, it would result in Iac~dies instaling ' just enough control technology" to get eM 01 review in· stead 01 BACT as IS requi'ed by lhe TCAA. This woutl in eflecl extend lhe ~Ie 01 the facility Without ever achieving the inlern of the TCAA of replacing outdated controls with the "best available controls: In add_ion, slall dis· agrees w~h Brown·s comment that lhe stan· dard permit wiN authorize the inaease in emissions, 1M noI the increase in p-odoction. As ClJ'Tently written, the language w~t authorize an ioaease in emissions slbjeclto cer· tain lim~alions. However, the increase in emissions wiU only be that portIOn colflCiden· lal wllh the potkAion reduction protect II is not OJ inlent to authorize any additional in·

• ADOn'ED RULES April 22. 1994 19 TexReg 3061 Add. 28


creases in emissions which might result from an increase in capacity. However, staff has agreed to change the language in §116.617(1)(A) to allow ~ododion increases that aceU" solely as a result of implementing required controls provided that the increased ~oducIion does nol resul in an eKceeda.nce of <lny C\I'T~ emission ffm( The emissiOns increase resulting from the increase in prodtJdion musI also be less than fhe deaease resufting lrom the installation of control equipment or implementation of a control tecn.. ....... E)()(()fl suggested clal'ifying §116.617(1)(0)(i) and (2)(O)(i) by moYing the plYase "coosidering the ernissions reductions thai wit result lrom the proiect" out 01 para!7aphs (1)(O)(i){t) and (2)(O)(i)(I) and inserting it in clalJSEl (i) in each case so thai M w~1 apply to both nonanainmeot and PSD cases. Also, actt the word -net" before "emissions ioaease" in clause (i).

Section 116.617(1)(O)(i)(I) and (2)(0)(i)(1) al· ready awIy 10 boIh PSO and nonanainment cases. The language in §116.617(1)(0) and (E) and (2)(0) and (E) was adopted from the so-callad -WEPCQ eKclusion" contained in 40 Code of FedefaJ Regulations 51 .165 and 52.21. The staff does no! see the need 10 change this language. Quo- procedU"e for nel· ting is outlined in the rule and the response 10 Ph~Iips' general comment above.

Pennzoil suggested allowing de minimis increases of one ton per year uOOe!" the two Slandard permits in §116.617. This will allow OJ*"ational nSKiHlity and encourage vollJlltary reduction projeds.

As long as emissions increases ot criteria. poIutanlS .. e less lhan significant (these tevels a'e much higher than one Ion per year (rPy», they are alowed under the slandard perm~ w~houI additionat review. Emission increases of noo-cr~eria pollutants musl meel the requi"ements of either SE 1000c) or (d) or SE 118(c). In many cases, these limijs are also !7ealer than one TPY. The staff has retained the proposed language, because it proYides more fleKibility than the suggested one TPY.

Convnenters lrom Euon, Brown, TCC, Phillips, Eastman, HL&P, and DuPOOI suggested revising §116.617(2) to allow implementation of control techriques on vobltay emission reQ.lction projects. Brown Slated thai StjJp.-al7aphs (A) and (C) ak"eady p-otecl against conslruClion of projects where the agency believes permitting shout:! be req"'ed. TCC commenled that the TNACC already has adequate authortly to take action against corTll8nies that improperty represent a project as a vduntay redllClion. In oeneral, the commenters believe that disallowing con· trof techniques as an option, w~1 discourage many CJOn1)8nies tom making voluntary emission redllClions.

The staff be~eves that the term "control tech-niques- shout:! be bener defined befae allow' ing the use of standard permits 10 authorize these types of projects in "voluntary" situa ' tions. The use of control techniques In standard perm~ 1 is awopriale, since the scope of these pro;ects is limited to those required

by the regulations . Unless this term IS narrowed down, there may be opportunMies lor ~ojeClS which should be required to be reviewed under §116.110 to slip tlTough by attaching themselves to the term "voluntary pollution control technique.- The staft has determined lhat cofllrol lecmques should remain 8KcIuded tom standard perm~ 2. After the rute is ettective and the staff has an opporturllty 10 rEMew some standard permit applications, this issue may be revisited

AmoctI Chern commented thai §116.617(I)(O) arx:l (2)(0) should aWow credit tor emission reductions in voluntary projects.

SectJOll 116.617(1)(0) does not adclress voluntary projects. Section 116. 617(2)(0) does not prohibil credM for redllClions 00tai0ed by voluntary P'o;ects. What this suq:.aragraph does. along w~h sl.bpara!7aph (E). is eKcIode lhese projects from the definition of major mcx:Iilication. Therefore, no netting is required for lhese specific: projects. However, as stated in response to Philips' general comment. any increases and decreases associaled w~h these projects are SIMI a-edijable and must be included in the nenlllg calculations for fiAure proiects, as tong as the reductions are not excluded by oIher rule requirements

Exxon and Brown suggested revising §116.617(1)(D)(iii) 10 allow emission increases that are associated with state or federaKy required emssion decreases to be eKdlded from nening and 10 take credit lor al decreases thai are not state or lederally required. TCC went 1lx1h8f in staling that stan· dard permits should not be inclt.ded in netling calculations at all. Nelling is a NSA concept and no! part of a mandated elT1lssion reduclion project. SectIOf1116.617(1)(D)(iii) should be rewr~ten to eliminate all nellr.g consideratiOns. Voluntary reduchons under §116.617(2)(D)(1i) should also be eKChx\ed from netting unless the source chooses to lake credit for the redllCllOflS, in which case. the increases wiU also be nened.

See the response to general oomments by Phillips. In regard to the last sentence 01 this comment, the slaH believes that all SOU'"ces should be treated the same with reganl 10 whelilef" increases and decreases !rom voluntary protects are included in the nenulg calculations. Tracking of emrss.ons credits is complicated enough without having 10 keep tradl. of wtwch projects an individual source decides should and should not be inclu:led irl the nening eKercise

TCC, Brown and OuPon! suggested revising the last senlence in §116.617(1) (A) and (2)(A) 10 cover standard eKemp4ions by adding "or qualities for"" before "any nl!C$sary authorization."

The staff agrees w~h thIS comment and has made the suggested change.

GHASP objected to allowing instaUatiOn 01 control eq~ment w~hout the TNACC approval in §116.617. GHASP repealed its general oppos~ion to standard permits in the General Comments.

The slaft response is the same as ~ was to the general comment.

19 TerReg 3062 April 22, 1994 Teros Register +

Subchapter B. New Source Review Permits

Permit Application • 30 TAC 1116.110. 1116.115

The amendments are adopIed urder Ifle TeKas HeaHh and Safety Code (Vernon 1990). the Tel(as Oean Ai Act (TCAA). §382.017. which prOYOes the TNACC w~h the authority to adc:pt rules consistent w'h the policy and ~oposes of the rCM.

This agency hereby certifies that the rule as adopted has been reviewed by legal ~set and found to be a valid eK8I"cise of the agency 's legal authaity.

Issued in Austin, TeKas, on April 6, 1994.

TRD·9439069 Mary fUh Holder Dftclor. LegIIJ DIvIfIor1 TeJWI NlIlUral Reaouro.

Conserv.IIQn com_km

Effective date: May 4, 1994

Proposal ptblication date: November 9, 1993

For further information, please call: (512) 239-0615

• • • Subchapter C. Permit Exemp·

tions • 30 TAC 1116.211

The amendment is adopted under the T eK8$ Health and Safety Code (Vernon 1990), the Te~as Clean Ai Act (rCM), §382.017, which proYides the TNACC w~h the authority to adopt rules coosisteot w~h the policy and ~oposes 01 the! TCM.

§1/6.2/J , Standard Exemption Ust.

(a) Pursuant to the Texas Clean Air Act (TCAA) , §382.057. the facilities or types of facilities listed in the Standard EKemption US!. dated April 6. 1994. as filed in the Secretary of State's Office and herein adopted by reference, are exempt from the permit requirements of the TCAA. §382.0518. because such facilities will not make a significant contribution of air con· taminants to the atmo~here. A facility shall meet the following conditions to be exempt from permit requirements:

( I) (No change.)

(2) Total actual emissions authorized under standard exemption from the proposed facility which is located in a nonattainment area shall not eKCeed:

(A)-(O (No change.)

(D) in an ozone nonaMainment area. the applicable major modification threshold of NO, in Table I of the definition of "major modifiCation" in §116.l2 of this title.

Add. 29


(3)-(6) (No change.)

(b) NotWithstanding the provisions of this sectioo, any facility which constirote! • new major source, (X" any modifICation which constitutes • major modifIcation under nonattaimnent review or Prevention of Significant Deterioration review as amended by the FCAA Amendments of 1990. and regulations promulgated thereunder shall be subject to the requirements of 1116.110 of this title (relating to Applicability) rather than this section.

(c)-(Q (No chao ... )

ThiS agency hereby certifies thai the n;e as adq:oted haS been reviewed by legal counsel and Ioun:t 10 be • valid ell8fcige of the agency's legal aulhDrty.

Issued in Austin, Texas, on Api 6, 1994.

TRD-9439061 MaIy AJIh HoIdtr DnQor, L. 0Iv1lbn Tu .. Nalural ~re. ......,Coi,,,_1on

Etted:iYe dale: May 4, 1994

Prop:I6aJ pOOIicaliondala: Nove/QJer 9, 19m

For fu1har inIOnnation, please call: (512) Z3&<l615

• • • Subchapter D. Permit Renew-

als • 30 TAC 1116.311 The amendment is acklIHd under lhe Texas Heath and Safety Code (Varnon 1990), the Texas Clean Ai" Ad. (TOM), §382.017. whiCh prooAdes Ihe TNRCC wIh the awhority to adopI nies consistent with the poley and proposes of the TCAA..

This agency hereby certifies that the rUe as adqHd has been reviewed by legal COU1S8I and Iourdlo be a valid exercise of the agency's legal authoriIy.

Issued In Austn, Texas, on ApI 6, 1994.

Mary Ru1h I-ioII* Director, L9 DMIIon T_ NPnI RMouI'Cll ......,--Eftedt.te date: May 4, 1994

Proposal patJlicatlon date: Novermer 9, 1993

For fl.I1:har information. ptaase call: (512) 239-0815

• • • Subchapter F. Standard Permits • 30 TAC §l1l6.610, 116.611,

116.614, 116.617 The new sections .. adopted ...... the Taxas Hedh and Saleliy Code (Vernon 1990), the Texas Clean Nr Ad (TCM), p82.017, which provides the TNRCC wilh !hi authorty 10 adopI rules QOOIistenl wlh !hi poliCy and p-opoUS of h TCAA.

§/ 16.610. Applicability and General Condi· ,iOlls.

(a) Pursuant to the Texas Oean Air Act (TCAA), 1382.051, projects involving the typeS of facilities or physical or operational cbanges to facilities which meet the requirements for a standard permit listed in §116.617 of this title (relating to Standard Permits List) are hereby entitled to the standard permit; provided however. that:

(1) any project which results in a net increase in emissions of air contaminants from the project other that those for which a National Amblent Air Quality Standard has been established must meet the emission limitations of Standard Exemption 1000c) or (d) or Standard Exemption 118(c);

(2) construction or operation of the project shall be commenced prior to the effoctive date of a revision k> §116.617 of this title under wbich the project would no lonp meet the requirements f« a standard permit;

(3) the proposed project shaU comply willl the applicable provisions of the Federal Clean Air Act (FCAA). §Ill (regarding Federal New Source Performance Standards) and fll2 (regarding Haz· ardous Air Pollutants);

(4) there are no petmi.ts under the same Texas Natural Resource Consetvalion Commission (TNRCC) account number that contain a condition or conditions precluding use of a standard permit or standard permits under this subchapter;

(5) the owner or operator of the facility registers the proposed project in accordance with §1l6.611 of this title (relating to Registration Requirements).

(b) Any project which constitutes a new major source. or major modification under the DeW source review requirements of Part C (Prevention of Significant Deteri«ation review) or Part 0 (nonattainment review) of the FCAA and regulations promulgated thereunder shall be subject to the requirements of §116.11O of this title (relating to Applicability) rather than this subchapter.

(c) No persons shall circumvent by artificial limitations the requirements of 1116. 110 of this title.

(d) The emission from the facility shall comply with all applicable rules and regulations of the lNRCC adopted under the Texas Health and Safety Code, Olapter 382, and with intent of the Texas Clean Air Act (TCAA). including protection of health and property of the public and all emissions control equipment shall be maintained in &ODd condition and operated properly during operation of the facility.

(e) All representations with regard 10 construction plans. operatin& procedures,

----- ------------

and maximum emission rates in any registration for a standard permit become conditions upon which the facility or changes thereto. shall be constructed and operated. It shall be unlawful for any person to vary from such representations if the change will affect that person's right 10 claim a standard permit under this section. Any change in conditions such that a person is no longer eligible to claim a standard permit under this section requires proper authorization under 1116. 110 of this title. The owner or opNator of the facility must notify the lNRCC of any other change in conditions which will result in a change in the method of control of emiss.ions, a change in the character of the emissions, or an increase in the discharge of the various emission as compared to the representations in the «iginal registration or any previous notification of a change in representations. Notice of changes in representations must be received by the TNRCC no later than 30 days after the change.

(0 All records relating to the applicability of and compliance with the terms of a standard permit shall be maintained by the permittee for at least a two-year rolling retention basis, and made available for review by authorized representatives of the TNRCC, United States Environmental Pr~ tection Agency, or local air pollution con· trol agencies.

(g) All changes authorized by standard permit 10 a facility previously permitted purwanl to §1l6.110 of this title shall be administratively inC<XpOCated into that facility's permit at such time as the permit is amended or renewed.

§116.6l/. Registralion Requirements. Registration for a standard permit shall be sent by certified mail, return receiPI requested or hand delivered 10 the Texas Natural Resource Conservation Commission (TNRCC) Office of Air Quality, the appropriate TNRCC Regional Office, and any kx:al air pollution program with jurisdic· tion. before a standard permit can be claimed. The registration shall:

(1) document compliance with the requirements of this section. including. but not limited to: the basis of emission estimates, quantification of all emission increases and decreases associated with the project being registered. sufficient information IS may be necessary to demonstrate that the project will comply with f1l6.610(b) of this title (relating to Applicability). information that describes efforts 10 be taken 10 minimize any collateral emissions increases that will result froni the project, a description of the project and related process, and a description of any equipment being installed;

(2) be received by the lNRCC no later than 45 days prior to the com-

• AnOn-ED RULES April 22, 1994 19 TexRlIg 3063 Add. 30


mencement of the prOject. Work may belm on the projccl Illy time upon receipt of written notifiCation from the lNRCC that there are no objections to the project or 45 dlY' after receipt by the TNRCC of the registr.tion for the project. whichever occurs first.

§116.614. Standard Permil Feu. Any person who claims I standard permit shall remit. It the lime of re&,istration. a nat fee of $450 for each stllldard permit claimed. All standard permit fees will be remitted in the fann of a check or money order made plylble to the Texas Natural Resource Consuvatioo Commission (lNRCC) and delivered with the permit f't&istration 10 the lNRCC. P.O. Box 13087, Austin. Texas 78753. No fees will be refunded.

§116.617. Standard Permils List . Pursuant 10 the Tens Clean Air Act, §382.051 . projects involving the typeS of facilities Of

physical or operational changes to facilities listed in this section qualify for a standard permit subject to the conditions slated in §116.61O of this title (relating: to Applicability and General Conditions).

(I) Installation of enllSSlons control equipment Of implementation of control techniques IS required by any slate or federal rule. standard. or regulation.

(A) Installation of the con-trol equipment or implementation of the centrol technique must not result in an increase in the facility's production capacity unless the capacity increase occurs solely as I result of the requirement to install the contrOl equipment or implement !be control technique on existins: units requimt to meet applicable emission limitatioos. The owner or operator must obtain or qualify for any necessary authorization pursuant to §116.110 of this title (relating to Applicability) prior to utilizing any production CIp.:ity increase that:

(i) results in the exceedanee of any ernissioo limit in an exiSfin& permit. other authorization. or arandflthered baseline; or

(ii) does not result solely from the installation of control equipment or implementation of control techniques; or

(iii) results in an emissions increase which exceeds the emission reduction due to the installation of control equipment or impJementation of control techniques.

(B) Any emission increase of an air contaminant must occur solely IS I result of the requirement to install an emission control device or implement I control technique.

ee) Installatien of enllSSlon control equipment or implementation of I

control technique shall not include the installation of • new production facility. rc-construction of I production facility as dd"tned in 40 Code of Federal Regulations (CFR) 6O.15(b)(l) and (c) • or complete replacement of an existina productien facility.

(0) If the project. without consideration of any othu increases or decreases not related to the project. will result in I si&nificant net increase in emissions of any criteria pollutant, I penon claiming thiS Slandard permit shal1 submit. with the registration. information suffteaent to demonstrate that the increase will meet the conditions of clause (i) of this subparagraph.

(i) The emissions in-crease shall not:

(I) considering the emlSSlen reductions that will result from this project, cause or contribute to a vinlatien of any national ambient air quality standard; or

(D) cause or contri~ ute to a violation of any Prevention of Sianifacant Detetiontion (PSD) increment:

'" (ID) ClUse or contri~

ute to I violation of any PSD visibility limitation_

(li) For purposes of thIS soction. "sia:nifica:nt net increase" means those emissions increases resulting solely from the installation of control equipment 01 implementation of control techniques that are equal to or greater than subelauses (I) Of

CD) of this clause;

(I) the major modification threshold listed in 1116. 12 of this title (rdatina to Nonattainment Review Definitions). Table I. for pollutants for which the area ill desisnated 1$ nonlttlmment. or for precursors to these pollutants;

(D) significant as derUled in Title 40 erR §52.21(b)(23) for pollutants for which the area is desi&nated attainment or unclassifiable. or for precur!iOf1 to these pollutants.

(ill) Netlin& is not rtr quired when determining whether this demonstration musl be made for the proposed project, and the increases and decreases resullins: from this project should not be included in any future netting cakulation.

19 r.;r//eg 3064 April 22, 1994 rUlU Registe, •

(E) For purposes of compLianee with the PSD and oonattainment new source review pl'OYisions cl Part C and Part D of the _ CIeon AU Act (R:AA) "'" regulaticrts promulgated thereW1det. any incruse that is less than si&nifi,cant. or satisfies the requirements of subparagraph (D) of this paragraph shall not constitute I physical chana:e or I chana:e in the method of operation. For purposes of compliance with the Standards of Performance for New Stationary Sources reaulations promulgated by the United States &.vironmental Protection Agency (FPA) at 40 CFR 60.14. an increase that satisfIeS the requirements of su~lrIaraph (0) of this parl&lapb shall satisfy the requirements of 40 Cf'R 6O.I4(e)(5).

(2) Voluntary instaUation of emissions control equipmenl

(A) Installation of the control. equipment must 00( result in an increase in the fEility's production capacity unless the Capltil)' increase occurs solely as a result of the instaUltion of control equipment on exiSl.ins: units. Any production capacity increI!Ie resulting from the installation of controls shall not be utilized until the owner or operator obtains or qualiflCS for any necessary authorizatioo pursuanl to §1l6.110 of this title (relating to Applicability).

(8) Any emissioo irx:reue of an air contaminant must occur soIdy IS •

result of installing an emission control de'lice.

(C) Installation of emission control equipme.nl shall not include the 1/1-

stallation of a new production facility. reconstruction of a production facility as defined in 40 CFR 6O.l5(b)(1) and (c). or complete replacement of an existing pr0-

duction facility.

(D) If the project. without consideration of any other increases or de· creases not related to the project. will result in a significant net increase in emissions of any criteria pollutant, I penon claiminallus standard permit shall submit, with the reptratien. inf«matioo sufficient to demoastrate that the increase will meet !he conditions of clau!le (i) of this su~aragraph.

(i) The emissions iocreast shall not:

(I) considerina !he emission reductions thlt will result from this project. cause or contribute to a Vlola· tion of any naliooal ambient air quahty standard; or

Add. 31


(D) cause or cootribute to a violation of any PSD increment; or

(Ill) cause or contribute 10 a violation of any PSD visibility limitation.

(n) For purposes of this section, "significant net increase" means those emissions ina-eases resulting solely from the installation of control equipment thaI are equal to or greater than subclause (I) or em of this clause:

(I) the major modification threshold listed in 1116.12 of this title. Table I, for pollutants for which the area is desi&nated as nonattainment, or for precursors 10 these poUutants;

(D) signifM:ant as defined in Title 40 CFR 152.21 (b)(23) foe pollutants for which the area is designated attainment or unc:lassifiable. or for precursors to these pollutants.

(iii) Although netting is not required when detenninirag whether this demonstration must be made for the proposed project. the increases and decreases resulting from this project must be included in any future netting calculation if they are determinod to be otherwise creditable.

(E) For purposes of compliance with the PSD and nonattainment new source review provisions of the FCAA, Part C and Part D and regulations promulgated thereunder, any increase that is less than si&,nificant, or satisfies the requirements of subparagraph (D) of this paragraph shall not constitute a physical change or a change in the method of operation. For purposes of campliance with the Standards of Performance fOl New Stationary Sources regulations promulgated by the United StateS Environmental Protection Agency at 40 CFR 60.14, an irw;rease that satisfies the requirements of subparagraph (0) of this paragraph shall satisfy the requirements of 40 CPR 60. 14(e)(5). This agency hereby certifies that the rule as adq:lted has been reviewed by IegaIl)()Ulsel and tound to be a valid exercise 01 the agen· cy's legal authorly.

IsSued n Austin, Texas, on Apri 6, 1994.

TRO-9439088 ..." ..... -OIredor, Legal OlvlllDn Texas Haturlll ~ree

"""""' ... """"""'" Efled:ille date: May 4, 1994

Proposa1 publication date: NoverTt!er 9, 1993

Fer blher information, please call: (512) 239-0615

• • •

Chapter 330. Municipal Solid Waste

Subchapter P. Pees and Reporting

• 30 TAC 1§33O.601-33O.604, 330.621, 330.641

The Texas Naha'al Conservation ComrDssion (TNRCC) adqlts amendmer1s 10 §§33O.601-330.603, 330.621, and 330.641, and new §330.604, concerning fees and repof1s. Sec· tions 330.601·330.603 and new §330.604 Me adopted wilh changes 10 the prCJpCl68d tellt as pubished n the October 15, 1993, issue 01 the Texas Register (18 TexReg 7130). Section 330.621 and §33O.841 are adopted withau: changes and ~l not be reptjlIished.

The adopted amendments and the new section implement the new p-ovisions of the Solid Waste Disposal Ad, Chapter 361 , Heath and Salety Code, promulgated by the 7Jrd Legislahn n Senate BiI 1051 (58 1051) and clarity certain operating pracedtM"es, related primarily to solid wasle lees, meastXemel"ll options, and reponing require~ .... The amended rules and the new rue provide new p-ocedxes and rates lor calculating soid wasle disposallees ·and criteria lor proWing refunds 10 lacil:ies thai: compost SOU"ce-separated yard waste. The amended nAes also clarify repormg requirements and add jl"llerest penalties for late payment of -. As a resul of the J)lb1iC oonvnert jrOCess, 49 spec:iliC comments and several general c0mments were received tom live organizations. COI'pOI"ations, and poilical slAXivislons.

lb8 commission received commel"lls rom North Central Texas Counc~ of Governmenls; Ciy 01 Oalas; ely of Plano; Texas Chapter, National Solid Wastes Management Associalion; and Laiclaw Wasle Systems, Inc.

One commenter recommended thai the fallowing be added aI the end 01 §330. 601(b)(1): "The commission shall <n!dit any fee payment due I.RIer this sllbSA':tion lor any material received and converted to compost er prOOud. lor composling thr0t.9h a COfl1)OSIing process. Any 00f11)0St or procU:l lor composling that is not used as compost and is deposited in a landfil is not exempt .. om the fee.' The slaiemenlS have been added as they are contained in the Healh and Safety Code (H$C), §361.013(f), as amerOed by 58 1051.

AnoIher convnent concerning §33O.601(b)(1) took exception 10 the use 01 the definition of "yard waste" as contained in the Health and $atety Code, §361 .421. The commenter expressed concern thai wlh this definition a Iaciity operator would be required to insped loads lor oversized material lor the fee exemption and then pt.t it !)ad( in the Ia.:i to be COfi1)O&1ed. However, the Healh and Salety Code, §361.0135(e), as added by §1 .09 01 sa 1051 states thai:: -In this sectiOn, 'yard waste' has the meaning assigned by the Heath and Satety Code, §361.421." Therelore, the convnissiOn wi. relan the original

language. NonsOIsce-sep~nled yNd waste, or yard waste thai contains materiel larger than six inches in diameter, is not exefT1ll: from a fee. The operator therefore has the responsibility in accordance with §33O.602(b) to assess a lee 01 cne haM 01 the rate assessed for waste deStined lor lanctliling on the entire load if al 01 the waste is to be composIed. The hauler should be Iorewamed thai he wMl be assessed a fee if unallowable waste is discovered upon unloading ut*!ss the operator chooses to segegate the wastes at the gate and assess the one-ha" disposal lee rale on ooly that waste that exceeds six incheS in diameter. Haulers and customers ml.lSt be educated on the need ler source separal:ion.

Also with rasped to §330.601(bX'), two commenters were concerned thai: wood waste ,,"ealer than six incheS in liameter was excluded trom the term -SOU'ce-seplWated yN"d waste" and hence noI exefT1ll: trom the fee, a.hough when such wood is regularty coIecIed and cf1iA:I8d into mulch and then composted there is no disli1ction n the p'Gcess or the end product. The commission appreciales the concern; however, the staUe is specific in .xerrlJling only sourceseparated yan:I waste from the lee.

Also with resped to §330.601(b)(1), two commenters wt!I'e coocemed that the colee· tion of but; yard waste inevitably results in some contamination level of other waste items, including plastic bags in which leaves and brush are placed. They noted, however, that Ihese contaminants are removed c:tumg the composting operation. The commission r8CO(p"izes that some amounts 01 col"llaminanIs are always a possi)~ity n sourceseparated materials aoo will make allow· ances lor minor amounts

Agakl, also with respect to §330.601(b)(1), another commenter reconmenclecl thai there be no imiI lothe diameter of vegetative malenatif the intent ot waste reduction is achieved silce modem <1inding equipmert can harde large diameter wastes. The diameter 01 the vegelaliYe waste is specified in the statulory oeflltion Of yard waste and the iIlIert is tor beneficial use of the OOfl1)OSted produd, not tor waste reduction. For that reason, any compost er produCIlor compostlng that is not used as ~ and is deposiIed in a laoofilt ill; not exerrlJl from the fee. Materials larger than six inches n tiameler may be ao:Ied to the OOfl1)OSting operation after grinding but they are not exemp: !rom a fee. In accordance with the Healh and Safety Code, §361 . 013(a); and §33O.602(b) Of this title (relaling to Fees), such waste received at a shredding and c:oqxJsting iacility wll pay one half 01 the lee set ler waste received at a landfill lor -. With resped to §33O.601(b)(oi), two c0m-

ments were received recommendirlg thai: the provisions requiTIg the commission to assess interest penalieS be made IIedlie by using the term ~may" instead of -Shar to be consiStel1 with the 1.158 in §330.602 and §330.603. One 01 the commenIers also suggested that a flat pendy be set rather than a siding scale. The commission believes that the use of "shalr and a sliding scale is neces· sary 10 conform to the 1aJ"9l&ge n House BI

• ADOPTED RULES April 22, 1994 19 TezRtJg 3065 Add. 32


those that develop property for sale or lease. [The individual owner ofa single family dwelling is not required to be a licensed installer in or-der to install or repair an on-site sewage facility (OSSF) on the owner’sproperty. This provision does not apply to developers or to those thatdevelop property for sale or lease. If the owner compensates a person toconstruct any portion of an OSSF, the individual performing the workmust be a licensed installer. The owner must meet all permitting, con-struction, and maintenance requirements of the permitting authority.The owner must have the site evaluation performed by an individualwho possesses either a current site evaluator or a professional engineerlicense.]

(b) If the aerobic treatment system owner elects to maintainthe system, the aerobic treatment system owner is not required to reg-ister with the agency as a maintenance provider, but must complywith the requirements of Chapter 285 of this title (relating to On-SiteSewage Facilities).

(c) [(b)] A licensed electrician who installs the electrical com-ponents, or a person that [who] delivers a treatment or pump tank andsets the tank or tanks into an excavation, is not required to have an in-staller license.

(d) [(c)] A professional engineer may perform site evaluationswithout obtaining a site evaluator license.

§30.247. Registration of Maintenance Providers.(a) A maintenance provider must be registered with the exec-

utive director.

(b) To register as required by Subchapter A of this chapter (re-lating to Administration of Occupational Licenses and Registrations),a person must:

(1) meet the requirements of Subchapter A of this chapter;

(2) submit a completed application and a $70 fee to theexecutive director on a form approved by the executive director;

(3) submit documentation by the manufacturer of anon-site sewage disposal system using aerobic treatment that theapplicant is certified to maintain the on-site sewage facility systemsunder a maintenance contract; and

(4) any additional information required by the executivedirector.

(c) To renew a maintenance provider registration, a mainte-nance provider must every two years:

(1) meet the requirements in Subchapter A of this chapter;and

(2) submit a completed renewal application and a $70 feeto the executive director on a form approved by the executive director.

This agency hereby certifies that the proposal has been reviewedby legal counsel and found to be within the agency’s legal author-ity to adopt.

Filed with the Office of the Secretary of State on September 15,

2005.

TRD-200504097Stephanie Bergeron PerdueDirector, Environmental Law DivisionTexas Commission on Environmental QualityEarliest possible date of adoption: October 30, 2005For further information, please call: (512) 239-5017

♦ ♦ ♦

CHAPTER 116. CONTROL OF AIRPOLLUTION BY PERMITS FOR NEWCONSTRUCTION OR MODIFICATIONThe Texas Commission on Environmental Quality (TCEQ orcommission) proposes amendments to §§116.12, 116.150,116.151, 116.160, and 116.610; the repeal of §§116.180 -116.183, 116.410, and 116.617; and new §§116.121, 116.180,116.182, 116.184, 116.186, 116.188, 116.190, 116.192,116.194, 116.196, 116.198, 116.400, 116.402, 116.404,116.406, 116.617, and 116.1200.

Sections 116.400, 116.402, 116.404, 116.406, and 116.1200are proposed with identical language as currently exists in§§116.180 - 116.183, and 116.410, respectively. The amended,repealed, and new sections will be submitted to the UnitedStates Environmental Protection Agency (EPA) as revisions tothe state implementation plan (SIP).

The commission also proposes to rename the title of Sub-chapter C from Hazardous Pollutants: Regulations GoverningConstructed or Reconstructed Major Sources (FCAA, Section112(G), 40 CFR Part 63) to Plant-Wide Applicability Limits; torename the title of Subchapter E from Emergency Orders toHazardous Pollutants: Regulations Governing Constructed orReconstructed Major Sources (FCAA, Section 112(G), 40 CFRPart 63); and to add a new Subchapter K, Emergency Orders.

BACKGROUND AND SUMMARY OF THE FACTUAL BASISFOR THE PROPOSED RULES

EPA adopted revisions to 40 Code of Federal Regulations (CFR)§§52.21, 51.165, and 51.166 in the December 31, 2002, publi-cation of the Federal Register (67 FR 251), which amended theapplication of federal new source review (NSR). Federal NSR istriggered by a new major source or major modification. If the areain which the source will be located is also classified as nonat-tainment for a pollutant that will be emitted by the source, thesource would need to offset the emission increase with emis-sion decreases at other facilities or through the purchase andretirement of emission reduction credits. The source would alsohave to apply control technology that meets the lowest achiev-able emission rate to the new and modified units.

Federal NSR reform is intended to limit the instances where fed-eral NSR will be required of facilities that undergo modifications.It will streamline plant modifications by allowing small changesto be completed without the delay associated with federal NSR.Currently, most modifications are evaluated to determine the ap-plicability of federal NSR through a netting exercise. Netting is anaccounting exercise where, prior to the modification of a facility,the sum of emission increases and decreases over a specifiedperiod of time at the plant site is determined. If the total exceedsthe major modification threshold, then the modification is subjectto federal NSR. NSR reform provides an additional path that maybe taken to avoid federal NSR applicability (plant-wide applica-bility limit) as well as methods to minimize the emission increasedetermined in the netting exercise (baseline and actual to pro-jected actual emission rates).

Plant-wide Applicability Limit (PAL)

Plant-wide applicability limit (PAL) is proposed for implementa-tion by building on the current state permitting flexibility providedby the state flexible permit. A plant may have several facilitiesproducing the same pollutant and may apply for this permit to

PROPOSED RULES September 30, 2005 30 TexReg 6183Add. 33


establish an emission limit on a particular pollutant for those fa-cilities. This limit would be established at the baseline emis-sion rate for the facilities and best available control technology(BACT) must be implemented, on average, on the facilities overan implementation period. This option would be available to stateflexible permit holders based on their previous flexible permit re-view. Modifications at individual facilities resulting in emission in-creases that stay below the plant-wide limit are exempt from net-ting. The commission solicits comments on its proposed methodof implementing the PAL and the relative benefits of the proposalversus the federal PAL. The commission also solicits commentson the benefits of adopting both the proposed version and thefederal version of PAL into the commission’s rules, such as aspecific PAL model based on an east/west division of the state.

Baseline

The emission increase associated with a modification is deter-mined by taking the difference, in tons per year, between the pro-posed emission rate and the actual average annual emissions(or baseline emissions) during the baseline period. The base-line period can be any consecutive 24-month period in the pre-vious ten years (typically that period where the emissions fromthe facility to be modified are the greatest). The baseline periodis a 24-month period in the previous five years for electric utilitysteam generating units.

Actual to Projected Actual Emissions

Actual to projected actual emissions consist of two parts. Thefirst allows for the use of projected actual emissions rates basedon projected demand rather than relying solely on the potentialto emit, or proposed allowable emission rate, to determine theemission increase associated with the modification at modifiedand affected units. Secondly, it extends the concept of exclud-ing demand growth from the projected emission increase to allsource types by allowing sources to remove that portion of emis-sion increase (the difference between the projected actual emis-sion rate and the baseline emission rate) that could have beenaccommodated in the baseline years.

NSR reform included two other components, the clean unit des-ignations, and pollution control projects.

As a result of a petition for review of EPA’s final action, on June24, 2005, the District of Columbia Circuit Court of Appealsin State of New York, et al v. U.S. Environmental ProtectionAgency, No. 02-1387, vacated the clean unit and pollution con-trol project provisions of the rule and remanded recordkeepingprovisions to the EPA. As a result of this court decision thecommission is not proposing rule changes concerning cleanunit and federal pollution control projects.

Although the commission is not proposing a federal pollutioncontrol project rule, in this rulemaking it proposes changes to thestandard permit for state pollution control projects. The standardpermit for state pollution control projects allows projects that willhave better or equivalent controls, but increases and decreasesfor projects qualifying for the standard permit for state pollutioncontrol projects requires evaluation for federal permitting applica-bility, which may include netting calculations. This new require-ment for the state pollution control projects is also a result of theJune 24, 2005, ruling, which does not allow an NSR exemptionfor incidental emission increases resulting from pollution controlprojects. In addition, the standard permit for state pollution con-trol projects may be used to authorize emissions reductions andcollateral increases for facilities authorized under a permit by ruleas long as any collateral increases do not cause emission rates

to exceed limits found in 30 TAC §106.4(a), or other standardpermits as long as any collateral increases do not exceed thelimits of §116.610.

The executive director had considered a federal pollution con-trol project standard permit(FPCP) as a method to authorize col-lateral emissions that would otherwise qualify as major sourcesor modifications. The FPCP was part of the NSR reform pro-gram adopted by the EPA. A June 24, 2005, decision by the fed-eral Court of Appeals for the District of Columbia vacated thatportion of the EPA rules that authorized the FPCP. As a resultof this ruling, the commission is not able to propose the FPCPas a method that excludes nonattainment and prevention of sig-nificant deterioration (PSD) review without a modification of thecourt of appeals’ decision upon rehearing or appeal. The com-mission seeks comments on alternative processes for authoriz-ing landfill gas flares and other ancillary facilities that have col-lateral emissions that would be considered major modificationsor major sources for nonattainment or PSD review.

SECTION BY SECTION DISCUSSION

The commission proposes administrative changes throughoutthis rulemaking to be consistent with guidance provided in theTexas Legislative Council Drafting Manual, November 2004, andto conform with Texas Register requirements and agency guide-lines.

§116.12. Federal Permit Definitions.

The commission proposes to amend §116.12 by changingthe title to reflect the addition of all definitions associated withfederal NSR permit applicability analysis. In addition to thechanges necessary to incorporate NSR reform into the nonat-tainment permit program, changes associated with includingPSD applicability analysis in §116.12 are also proposed. Thesedefinitions now apply to the revised sections of the PSD rules inChapter 116, Subchapter B, Division 6 of this chapter as well asthe new sections associated with PAL permits.

The definition of actual emissions, in paragraph (1), has beenmodified to exclude this definition from being used in the fed-eral NSR applicability test. When determining whether the emis-sion increase associated with a project is significant, the baselineactual emissions, defined in new paragraph (3), must be used.Paragraph (3)(A) allows electric utility steam generating units toidentify baseline actual emissions as the average rate, in tonsper year, at which an existing unit emitted the pollutant duringany consecutive 24-month period within the five-year period im-mediately preceding construction. A different time period maybe selected if it is shown to be more representative of normalsource operations. This is consistent with past guidance pro-vided by EPA for these sources.

Proposed paragraph (3)(B) allows other source types to choose24 consecutive months in the ten years preceding start of con-struction to establish their baseline emissions. In this case, thesource must adjust this emission rate down for any emission limi-tations that would currently apply to the facility. These limitationsinclude requirements in the SIP, federal rules with the exceptionof 40 CFR Part 63, or permit requirements that would apply whenthe analysis is completed.

Proposed paragraph (3)(C) identifies baseline emissions for newfacilities as being zero and also defines baseline emissions fornew facilities that have operated for less than two years to bethe facility’s potential to emit. Paragraph (3)(D) would require

30 TexReg 6184 September 30, 2005 Texas RegisterAdd. 34


that a project affecting all facilities use the same 24-month base-line period for each pollutant. For example, if a project affectedfive facilities that emitted volatile organic compounds and partic-ulate matter (PM), all five would have to identify the same base-line period for volatile organic compounds; however, a different24-month period could be chosen for particulate matter. Thesource must have sufficient records to document the baselineemissions, which cannot have occurred before November 15,1990.

Proposed paragraph (3)(D) also requires that baseline emissionrates be adjusted down to exclude noncompliant emissions.The EPA’s reform rule requires that baseline emissions in-clude startup, shutdown, and malfunction emissions. Thecommission’s policy, which has evolved over a number ofyears, currently allows for permitting of emissions from certainmaintenance, startup, and shutdown activities. Changes to thispolicy are being evaluated. The commission has been unsuc-cessful in getting clarification on the EPA’s basis for inclusion ofmalfunction emissions in the baseline calculation. Given thesecircumstances, proposed paragraph (3)(E) has been added toallow for the inclusion of those emissions that could currentlybe authorized by permit to be included in the baseline. Giventhat sources would become aware of this change with adoptionof this rule amendment, the effort involved in authorizing thesetypes of emissions, and the baseline period having to be withinten years of the project, this method of determining baselineemissions would be available for some time but not beyond tenyears from the effective date of this rule amendment. After thatdate, all baseline emissions will have to have been authorizedunder minor or major NSR. The proposed paragraph (3)(D) alsorequires that fugitive emissions be included in the baseline tothe extent they can be quantified.

Proposed paragraphs (6) and (7), associated with the federaldefinition of clean coal, have been added as a result of includ-ing PSD applicability into the definitions under this section. Thedefinition of de minimis threshold test would be renumbered asparagraph (11) and would be revised to reference major modifi-cation thresholds, including those for PSD as well as nonattain-ment.

The federal definition of electric utility steam generating unit isprovided in proposed new paragraph (12). It identifies thoseunits that are subject to a different baseline emissions determina-tion than other source types. New paragraph (13) would definefederally regulated NSR pollutant, providing a comprehensive listof pollutants that may be subject to federal NSR.

The definition for major stationary source would be renumberedas paragraph (15) and would be modified to remove referencesto facility for clarity, as well as to include PSD review within thedefinition. 40 CFR §51.166(b)(1) is referenced to identify thePSD major source thresholds. The "source" identified in this def-inition is the EPA NSR source that is, in most cases, analogousto "account" as defined in 30 TAC §101.1.

A number of changes are proposed for the definition of majormodification in renumbered paragraph (16). Language would beadded to incorporate PSD review into the definition and refer-ences to facility would be removed for clarity. Language wouldbe added to clearly identify the two criteria, a significant projectemission increase and a significant net emission increase, thatmust be met for a modification to be considered major at a ma-jor source. The definition would be expanded to identify projectsperformed at facilities within a PAL as being major modifications

if the modifications result in emission increases at facilities out-side the PAL that are significant. This requirement ensures thatif a PAL is not established for an entire process, any significantemission changes at non-PAL permitted facilities result in a fed-eral permit review. Exceptions would be added to the definitionfor projects satisfying the requirements for a PAL except as pre-viously noted and for various clean coal projects.

The commission proposes changes to the definition of netemission increase in renumbered paragraph (18) specifying thatbaseline actual emissions are to be used to determine emissionincreases and decreases, adjusting the language to accommo-date for PSD applicability, and excluding emission increases atfacilities under a PAL from being creditable. Under the proposedamendment, emission decreases cannot be counted in both anattainment demonstration and credit for nonattainment nettingbecause this would be double credit for the same reduction.Emission decreases need only be enforceable as a practicalmatter rather than federally enforceable and the emissiondecrease cannot have been relied upon in the issuance of aPAL. Emission decreases may be creditable at these typesof facilities, but they must go beyond what is required for thepermit exclusion or designation. An emission reduction may begenerated within a PAL, but the PAL must be lowered by thatamount and the reduction must be real and enforceable in thesame way as if the PAL were not in place.

The definition of offset ratio in renumbered paragraph (19) hasbeen revised to incorporate the same limits relating to emissionreductions that have been relied upon in the issuance of a PAL.

Proposed new paragraphs (20) - (24) have been added to in-corporate new definitions from NSR reform related to PALs intothe commission rules. These new paragraphs include definitionsfor: PAL; effective date; PAL major modification; PAL permit; andPAL pollutant.

The requirement to use baseline actual emissions has beenadded to renumbered paragraph (26), in the definition of projectnet.

Proposed new paragraphs (27) and (28) are added to define thenew concepts of projected actual emissions and projects emis-sions increase. The project emissions increase may be deter-mined in a different manner than the other emission increasesthat might be part of a netting exercise (used to determine thenet emissions increase). For existing facilities, the emission in-crease at modified or affected facilities may be determined byusing the projected actual emissions rate rather than the poten-tial to emit for the facility. The projected emission rate must bedeveloped using all relevant information including company pro-jections and filings with regulatory authorities. The basis for theprojection must be maintained by the source and would be sub-mitted with any documentation required for a state NSR autho-rization to demonstrate that the project is not subject to federalreview. The source would be required to demonstrate compli-ance with the projected emission rates for ten years if there wasa change to the source’s potential to emit or increase in capacity.Other affected facilities would be required to demonstrate com-pliance with projected rates for five years.

The actual to projected actual emissions rate test also allowsthe source to remove from the project increase any emissionsincrease that could have been accommodated in the baselineperiod. These must be unrelated to the project and may includedemand growth. This federal rule change extends this conceptthat was developed for the electrical generation industry where



traditionally there had been a captured, or limited, customer basethat was expected to grow at some rate unrelated to the availablecapacity of the generator. While this concept appears reason-able for the electric power industry as well as some sources witha limited customer base due to geography (such as gasoline ter-minals), it is not as useful for industries that have national or inter-national markets served by multiple sources. In these cases, ademonstration would need to be made that the market conditionsexpected in the future are expected to be significantly differentthan any time in the past ten years and that if they had occurredin the baseline, they would have resulted in different operations.It is likely that this case would only be made in cases such asa prolonged outage at a major producer or a significant shift inmarket conditions. The determination of what could have beenaccommodated is limited to what could have been produced orhandled and does not allow for changes in emissions that couldhave occurred due to a lower emission control device efficiencyor the use of a fuel or solvent that might have resulted in greateremissions. The commission encourages comments on the in-terpretations related to the actual to projected actual emissionsrate.

A definition for temporary clean coal technology demonstrationproject is proposed as new paragraph (31) to fully incorporate allof EPA’s exclusions to what is considered a major modificationunder NSR reform.

Existing paragraphs are proposed to be renumbered to accom-modate the proposed new definitions.

§116.121. Actual to Projected Actual and Emissions ExclusionTest for Emissions Increases.

This new section is proposed to require documentation associ-ated with the projected actual emissions rates and records ofcompliance as identified in the federal rule. New subsection (a)would require a demonstration that federal NSR review does notapply be submitted with any permit application or registration.This demonstration must be documented by records that includea project description, the facilities affected, and a description ofthe applicability test. New subsection (b) would require moni-toring of emissions that could increase as a result of the projectif projected actual emissions are used to determine the projectemission increase at a facility.

New subsection (c) would require electric utility steam generat-ing units to provide the executive director documentation of emis-sions for each calendar year that records are required under theactual to projected actual test. New subsection (d) would requirefacilities other than electric generating units to submit a report tothe executive director if annual emissions exceed the baselineactual emissions by a significant amount. Any other informationthat the owner or operator wishes to include in the report, such asan explanation as to why the emissions differ from the precon-struction projection, may be included as well. New subsection(e) would establish record retention periods.

The commission expects that projected actual emissions will beused extensively in registrations or claims for state NSR autho-rization where a maximum allowable emission rate is not spec-ified in the rule. The use of a projected actual emissions ratefor a modified source in a state NSR construction permit is ex-pected to be limited because the state allowable emission ratewould not generally be based on an activity level that would notbe reached for more than ten years.

§116.150. New Major Source of Major Modification in OzoneNonattainment Areas.

The proposed amendment to subsection (b) would delete lan-guage referring to a modified facility that will be a new majorstationary source, which has caused confusion about what con-stitutes a major modification at an emission source that becomesmajor after the modification. A minor modification to a minorsource that results in a major source does not qualify the modifi-cation as major. The commission will refer this determination tothe definitions of major stationary source and major modificationin §116.12. The commission would also substitute the term "fa-cility" for "emission unit" in subsection (e)(1) for consistency inuse of terms. The amendment to this section would also updatethe reference of the §116.12 title to Federal Permit Definitions.

§116.151. New Major Source or Major Modification in Nonattain-ment Area Other Than Ozone.

The proposed amendments to this section consist primarily ofadministrative and formatting changes. This section is proposedto be reformatted into subsections. The reference to November15, 1992, would be deleted from subsection (a) because thatdate has passed and is not necessary for application of the sec-tion. The commission would also substitute the term "facility"for "emission unit" in subsection (c)(1) for consistency in use ofterms. Subsections (b) and (c) are proposed to state when net-ting will be required.

§116.160. Prevention of Significant Deterioration Requirements.

The proposed amendment to this section would limit the incor-poration by reference of definitions from 40 CFR §52.21 that areused to administer the PSD program, deleting most of the lan-guage in subsection (a) and all of the language in existing sub-sections (b) - (d).

Amended subsection (a) would delete the federal rule referencesand replace them with language that requires a proposed newmajor source or major modification in an attainment or unclassi-fiable area to meet the requirements of this section.

The proposed new subsection (b) would state that the de minimisthreshold test (netting) is required for all modifications to existingmajor sources of federally regulated NSR pollutants, unless theproposed emissions increases associated with a project, withoutregard to decreases, are less than major modification thresholdsfor the pollutant.

Proposed new subsection (c) would incorporate by reference thefollowing definitions and requirements located in 40 CFR §52.21:baseline concentrations, baseline dates, baseline areas, inno-vative control technology, federal land manager, terrain, Indianreservations/governing bodies, increments, ambient air ceilings,restrictions on area classifications, exclusions from incrementconsumption, redesignation, stack heights, exemptions, sourceimpact analysis, air quality analysis, source information, addi-tional impact analysis, sources impacting federal Class I areas,and innovative technology. Other definitions used for the PSDprogram or visibility in Class I areas program are currently in thecommission’s rules. The proposed amendment would also sub-stitute the term "facility" for "emissions unit" in the definitions in-corporated from the CFR because the commission’s permittingactions are based on the individual facility or groups of facilitiesas defined in the commission’s rules.

Existing subsection (d) is proposed to be relettered as subsec-tion (e).

In addition to renaming Subchapter C, the commission also pro-poses new Division 1, Plant-Wide Applicability Limits.



The commission proposes the repeal of existing §116.180,Applicability; §116.181, Exclusions; §116.182, Application; and§116.183, Public Notice Requirements.

Proposed new §§116.180, 116.182, 116.184, 116.186, 116.188,116.190, 116.192, 116.194, 116.196, and 116.198 would be innew Division 1.

§116.180. Applicability.

This proposed new section limits a PAL to one pollutant as re-quired by the EPA and a site to one PAL permit in subsection (a).A PAL permit may contain separate PALs for several pollutantsand will likely be consolidated with a state or federal constructionor flexible permit at the site. Subsections (b) and (c) identify theadministrative procedure for changes in ownership as well as re-sponsibility for the PAL permit application.

§116.182. Plant-wide Applicability Limit Permit Application.

This proposed new section identifies the information necessaryfor a PAL permit application. Paragraph (1) requires the facili-ties that would be included in the PAL to be identified with theirdesign capacities and potential to emit, and state NSR autho-rizations. Paragraph (2) requires that the baseline emissions forthose facilities be identified so that they may be used to set thePAL. Paragraphs (3) and (5) require the applicant to identify howplans to monitor and use that information will be used to demon-strate compliance with the PAL. This information will serve as astarting point to develop PAL permit conditions.

New paragraphs (4) and (6) would require that BACT, on aver-age, be implemented on all existing facilities to be included in thePAL over a period of time (typically less than five years). This isbeyond what the EPA reform requires, but is consistent with thestate flexible permit program. BACT also allows flexible permitholders to establish a PAL based on their past flexible permit re-view to allow for maximum flexibility at a plant site. The BACTrequirement does not change the PAL, which is set using base-line emissions for the facilities. Paragraph (6) would require animplementation schedule for BACT if control technology requiresupgrading.

§116.184. Application Review Schedule.

This proposed new section would require that PAL applicationsbe reviewed on a schedule similar to other air permits as pro-vided for in §116.114, Application Review Schedule.

§116.186. General and Special Conditions.

This proposed new section identifies the PAL as an annual emis-sion rate for a federally regulated NSR pollutant covering all fa-cilities identified in the application in subsection (a). Emissionsfrom all facilities must be determined and compliance with thePAL must be documented monthly.

Subsection (b) identifies the general conditions applicable to ev-ery PAL. Paragraph (1) emphasizes that the PAL is not an autho-rization to construct but only sets an emission rate, below whichfederal NSR is not required. Paragraphs (2) and (3) identify sam-pling procedures and how a permit holder might obtain approvalfor an equivalent method. These requirements ensure consis-tency between various types of the commission’s air permits.

Subsection (b)(4) would integrate common recordkeeping andreporting requirements for most other air permits with the muchmore extensive requirements identified in the EPA rule. Sub-paragraphs (A) and (B) of paragraph (4) require that the PAL per-mit application, and records associated with demonstrating cap

compliance be maintained on site. Subsection (b)(4) includesthe reporting requirements from the EPA rule. The semiannualand deviation reporting requirements in the federal rule are re-dundant with the current requirements in 30 TAC Chapter 122,Federal Operating Permits, and were not included in this pro-posed rule.

Subsection (b)(5) - (7) contains language common to air permitsidentifying what facilities are covered by the PAL, and requiringproper operation of control equipment and compliance with allrules. The PAL life of ten years is identified in paragraph (8).Paragraphs (9) and (10) incorporate requirements from the EPArule requiring facility emissions to be reported as the potential toemit if monitoring data is not available, and that all data used toestablish the PAL be re-validated at least every five years.

Subsection (c) identifies those EPA requirements that mustbe incorporated into the permit through special conditions. Allfacilities in a PAL must be monitored using one of the followingfour methods: mass balance; continuous emission monitoringsystem, continuous parameter monitoring system, or predictiveemission monitoring system; or emission factors. An alternateapproach may be approved by the executive director. Perfor-mance standards for each type of monitoring are specified.The special conditions will also require a BACT implementationschedule, if applicable.

§116.188. Plant-wide Applicability Limit.

This proposed new section identifies how the PAL is to be de-termined. Paragraph (1) allows the inclusion of emissions up tothe significance level in addition to baseline emissions, but notesthat adding these emission will affect any evaluation of emissionincreases at non-PAL sources. Paragraph (2) limits all facilities tothe same baseline period for a given pollutant. Paragraph (3) ad-dresses how to determine the PAL if there is a major modificationinvolved. Modified sources contribute their allowable emissionrates while existing unmodified sources contribute their baselineemission rates. Paragraph (4) would require that the PAL be re-duced for any effective rules that have a future compliance date.

§116.190. Federal Nonattainment and Prevention of SignificantDeterioration Review.

This proposed new section identifies that any changes that oc-cur under a PAL are not considered federal modifications unlessthe PAL will be exceeded. Subsection (b) would restrict the gen-eration of offsets from facilities under a PAL to cases where thePAL is lowered and such a decrease would be creditable withoutthe PAL.

§116.192. Amendments and Alterations.

This proposed new section would allow increases to a PAL onlythrough amendment in subsection (a). Subsection (a) requiresthat the new or modified facilities causing the need for the PAL in-crease be reviewed under the appropriate federal NSR program.Modified sources contribute their allowable emission rates to thenew PAL while existing unmodified sources contribute their pre-vious emission rates. The amended PAL is subject to public no-tice. The PAL increases are effective when the new and modifiedunits become operational. Subsection (b) would limit reconsid-eration of controls associated with a PAL to amendments, but al-low for changes in the implementation schedule to be requestedthrough alteration. Subsection (c) identifies other changes thatmay be completed by alteration. These include changes to thespecial conditions that do not increase the emission cap, as well



as adding new facilities to the PAL to ensure adequate monitor-ing is in place.

§116.194. Public Notice and Comment.

This proposed new section requires that all PAL initial issuances,amendments, and renewals go to public notice with a possiblenotice and comment hearing as specified in 30 TAC Chapter 39,Subchapters H and K, Applicability and General Provisions; andPublic Notice of Air Quality Applications.

§116.196. Renewal of a Plant-wide Applicability Limit Permit.

This proposed new section requires that a PAL renewal applica-tion be submitted within six to 18 months of the PAL expirationdate in subsection (a). Submittal within that time period ensuresthat the PAL will not expire. Subsection (b) makes all PALs issuedwith flexible permits under past guidance subject to renewal un-der this proposed rule. Any PAL that has been in place for morethan ten years must be submitted for renewal by December 31,2006, or within the time specified, whichever is later.

Subsection (c) identifies the information necessary for a renewalapplication. This information includes: the proposed PAL level;identification of and justification for those qualified facilities to beincluded in the PAL; the potential to emit for qualified facilities andhighest consecutive 12-month emissions in the last ten years forthose that are not qualified; the associated state NSR autho-rizations; and any other information the executive director mayrequire to determine at what level to renew the PAL.

Subsection (d) would require public notice for the renewed PAL,while subsection (e) includes the requirements for establishingthe renewed PAL. These include summing the potential to emitfor qualified facilities and the greatest rolling 12-month emissionsfor the facilities that are not qualified. The significance level forthe pollutant may be added to that, but in no case may the newPAL level exceed the previous level. The significance level for acriteria pollutant is the netting trigger level found in the definitionof major modification (Table 1) in §116.12.

§116.198. Expiration or Voidance.

This proposed new section requires that all BACT upgrades ei-ther be complete or be made enforceable in another mannerprior to a PAL being voided. Once the controls have been imple-mented, a PAL may be dissolved at the permit holder’s request.There is no need to allocate the PAL among facilities becausethere will be allowables associated with the state or federal au-thorizations.

§116.400. Applicability; §116.402. Exclusions; §116.404. Ap-plication; and §116.406. Public Notice Requirements.

These proposed new sections contain identical language to thatfound in the current §§116.180 - 116.183. These sections applyto the regulation of sources of hazardous air pollutants. The newsections are proposed as a reorganization of this chapter in or-der to accommodate new sections concerning NSR reform anddo not contain substantive changes. The commission proposesadministrative changes to be consistent with previously men-tioned guidelines and to remove dates that are no longer applica-ble. The commission is not seeking comments on the substanceof the sections, but rather, seeking only comments regardingthe new organization structure, or non-substantive changes thatwould improve clarity of these sections.

The commission proposes the repeal of §116.410, Applicability.


The proposed amendment to this section would remove refer-ences in subsection (a)(1) to specific paragraphs within 30 TAC§106.261 because the paragraph numbering of §106.261 haschanged. The reference to 30 TAC §106.262 would be deletedbecause §106.261 refers to the use of §106.262, when applica-ble. The proposed change to subsection (b) would delete theexemption from NSR requirements for projects authorized underproposed new §116.617. As discussed earlier, this change isbased on the June 24, 2005, decision that vacated EPA rulesexempting incidental emission increases from NSR.

The commission proposes the repeal of §116.617, Standard Per-mits for Pollution Control Projects.

§116.617. State Pollution Control Project Standard Permit.

This proposed new section would incorporate existing require-ments listed throughout the current rule, while clarifying thelanguage in new subsection (a). Subsection (a) is organizedinto paragraphs (1) - (4), which include scope and applicabilityconditions currently found in existing §116.617. Proposed newsubsection (a)(1) lists the three types of existing authorizationsthat may be modified by a state pollution control projectsstandard permit. Proposed new subsection (a)(2) clarifies thetypes of projects that may be authorized by a state pollutioncontrol projects standard permit, reorganized from the existing§116.617 requirements.

Proposed new subsection (a)(3) outlines the prohibitions for useof the state pollution control projects standard permit, clarifyingthe existing intent and requirements of current §116.617. Specif-ically, subsection (a)(3) does not allow production facilities to bereplaced or modified in any way under this authorization sincethese types of changes need to be reviewed for BACT and po-tential harmful effects to health and property in accordance withTexas Health and Safety Code (THSC), Chapter 382, the TexasClean Air Act (TCAA), §382.0518 and §116.610, unless the con-ditions of a standard permit or permit by rule are met. Proposedsubsection (a)(3)(A) states that the standard permit will not beused to authorize complete replacement of an existing facility orreconstruction of a production facility.

Proposed new subsection (a)(3)(B) states that any collateralemission increase associated with the state pollution controlprojects standard permit must not cause or contribute to anyexceedance of a national ambient air quality standard or causeadverse health effects. Proposed new subsection (a)(3)(C)prohibits the use of the state pollution control projects standardpermit for the purpose of bringing a facility or group of facilitiesinto compliance with an existing authorization or permit, which,by practice and intent, has never been allowed. Correcting suchviolations using the state pollution control projects standardpermit would circumvent the potential evaluation of BACT andreview of environmental and health effects that should haveoccurred during the original facility authorization review.

Proposed new subsection (a)(4) addresses how projects thathave been registered under the existing §116.617 may continueto be authorized and subsequently meet the conditions of thisproposed new §116.617. Projects authorized prior to the effec-tive date of this rulemaking may defer the inclusion of emissionincreases or decreases resulting from the project until future net-ting calculations. Paragraph (4) allows currently authorized con-trol projects to continue operation uninterrupted until the ten-yearrenewal anniversary of the original registration or until otherwiseincorporated into a permit or standard permit. The current re-view period of 30 days would be extended to 45 days to allow



evaluation of netting, which would be required under the statepollution control projects standard permit.

Proposed new subsection (b) is organized into paragraphs(1) - (5) and includes the general requirements dispersedthroughout current §116.617. Proposed new subsection (b)(1)requires compliance with the specific conditions of §116.604,Duration and Renewal of Registrations to Use Standard Per-mits; §116.605, Standard Permit Amendment and Revocation;§116.610, Applicability; §116.611, Registration to Use a Stan-dard Permit; §116.614, Standard Permit Fees; and §116.615,General Conditions. While these requirements are not new, theyare reorganized to emphasize and remind applicants of theseconditions to ensure submittal of more complete registrationinformation.

Proposed new subsection (b)(2) contains a new requirementspecifying that construction or implementation of the statepollution control projects standard permit must begin within180 days of receiving written acceptance of the registrationfrom the executive director, and that changes to maximumallowable emission rates are effective only upon completion orimplementation of the project. This requirement is added forthree reasons: 1) questions regarding the start of constructiondeadlines and effective dates of new emissions limitations arefrequently asked of the executive director; 2) setting a deadlineconsistent with §116.120, Voiding of Permits, ensures timelyprogress toward pollution control; and 3) this deadline keeps anyemission changes within a contemporaneous netting window iffederal permit applicability is of concern.

Proposed new subsection (b)(3) would exempt for state pollutioncontrol projects standard permits from the emission limits anddistance requirements of permit by rule, §106.261, as referencedin §116.610(a)(1). Pollution control projects are considered en-vironmentally beneficial so any emission increases associatedwith these projects do not require further authorization.

Proposed new subsection (b)(4) contains a new requirement thatpredictable maintenance, startup, and shutdown (MSS) emis-sions directly associated with the state pollution control projectsstandard permit be included in the maximum emissions repre-sented in the registration application, consistent with the ongoingefforts of the commission to authorize all aspects of normal op-erations. The commission solicits comments regarding the cal-culation, reporting, and inclusion of MSS emissions within thisstandard permit.

Proposed new subsection (b)(5) contains the same require-ments as in current §116.617(5) and (6) and limits emissionincreases to only those directly as a result of the pollutioncontrol project. Any incidental production capacity cannotbe authorized by the state pollution control projects standardpermit, but requires some other preconstruction authorization.

Proposed new subsection (c) includes the same requirements asin current §116.617(4), as well as two new requirements. Sub-section (c) is organized into paragraphs (1) - (3) and pertains torequirements specific to replacement projects. Proposed sub-section (c)(1) repeats the current §116.617(4) and allows re-placement controls or techniques to be different than those cur-rently authorized as long as the new project is at least as effectivein controlling emissions. Proposed new subsection (c)(2) allowsfor increases in MSS emissions if these emissions were reviewedas part of the original authorization for the existing control equip-ment or technique, and if the increases are necessary to imple-ment the replacement project. Proposed new subsection (c)(3)

is a new requirement and is intended to clarify that the applicabletesting and recordkeeping requirements associated with the cur-rently permitted control or technique apply to the replacement toensure continuing compliance with associated emission limits. Ifthe control or technique is substantially different than an existingcontrol or technique, applicants may also propose equivalent al-ternatives for review by the executive director.

Proposed new subsection (d) clarifies the requirements of cur-rent §116.617(4)(C), adds varying fees for different project types,and clearly specifies documentation required in a state pollutioncontrol projects standard permit registration application. Pro-posed new subsection (d)(1) includes existing language foundin current §116.617(4)(C), but changes the required fees basedon whether the project or change in representation results in anincrease in the maximum authorized emission rates. Changes tofee requirements are proposed to encourage the installation anduse of pollution control projects, especially where there is no in-crease in emissions or the changes require minimal review. Thissubsection also describes when a registration should be submit-ted and when construction or implementation may begin. Vari-ous deadlines are proposed to provide flexibility and encouragethe use of pollution control projects. Regardless of these dead-lines, all projects must meet all requirements of the state pollu-tion control projects standard permit and the responsibility to doso remains with the applicant at all times. Proposed new sub-section (d)(2) clarifies current registration requirements. Theseinclude a process and project description, a list of affected per-mits and emission points, calculated emission rates, the basis ofthose emission rates, proposed monitoring and recordkeeping,and the proposed method for incorporating the state pollutioncontrol projects standard permit into existing permits.

Proposed new subsection (e) incorporates requirements foundin §116.615, General Conditions, but expands, clarifies, andfocuses those requirements specifically for the state pollutioncontrol projects standard permit. Proposed new subsection(e)(1) emphasizes that a project should be constructed andoperated in accordance with good engineering practices to min-imize emissions. Proposed new subsection (e)(2) specificallyrequires copies of documentation to be kept demonstratingcompliance with this standard permit.

Proposed new subsection (f) provides clarification of the proce-dures for, and under what conditions, a state pollution controlprojects standard permit should be incorporated or administra-tively referenced into a facility’s NSR authorization. Proposednew subsection (f)(1) applies to facilities authorized by a permitor standard permit. Proposed new subsection (f)(1) applies tothose state pollution control projects standard permits that au-thorize new facilities or changes in method of control and wouldrequire incorporation upon the next amendment or renewal ofthe facility’s authorization. Although incorporation is not a newrequirement, subsection (f)(1) clarifies that the project will havean impacts review, no evaluation of BACT is required, and thatthe increases will not trigger public notice.

Proposed new subsection (f)(2) applies to facilities authorizedunder a permit by rule and requires that all increases in previ-ously authorized emissions, new facilities, or changes in methodof control or technique authorized by this standard permit complywith §106.4, except for the emission limitations in §106.4(a)(1)and §106.8.




This proposed new section contains the identical language foundin existing §116.410 and allows facility owners or operators to ap-ply to the commission for a suspension of permit conditions forthe addition, repair, or replacement of control equipment in theevent of a catastrophe. This new section is proposed in orderto reorganize this chapter to accommodate new sections associ-ated with NSR reform and does not contain substantive changes.The commission is not seeking comment on the substance of thesection, but rather, seeking only comments regarding the new or-ganization structure or non-substantive changes that would im-prove the clarity of this section.

FISCAL NOTE: COSTS TO STATE AND LOCAL GOVERN-MENT

Nina Chamness, Analyst, Strategic Planning and Grants Man-agement Section, determined that for the first five-year period theproposed rules are in effect, no fiscal implications are anticipatedfor the agency or other units of state or local governments as aresult of administration or enforcement of the proposed rules.The proposed rules would implement EPA regulations concern-ing NSR reform.

The proposed rules seek to implement NSR reform by repeal-ing, amending, and proposing new sections of this chapter. EPAreceived feedback that needed improvements to facilities havenot been undertaken because of the cost of federal NSR evalu-ations. EPA indicated that the intent of the reform of the processis to limit the instances of modification that would, under cur-rent rules, trigger federal NSR. Fewer planned facility modifica-tions would be subject to emission accounting exercises whereincreases and decreases of emissions in a certain time periodare totaled to determine if a facility modification is classified asa major modification and, therefore, subject to federal NSR.

Reform of federal NSR offers options by which facility ownersor operators can avoid the triggering mechanisms of federalNSR. The reforms that these proposed rules would implementare: state pollution control and prevention projects, PALs, andchanges in the calculation of emission increases and actualemission baselines. The use of these reforms is not mandatoryand owners or operators of modified facilities would implementthese reforms on a voluntary basis.

PUBLIC BENEFITS AND COSTS

Ms. Chamness also determined that for each year of the firstfive years the proposed rules are in effect, the public benefit an-ticipated from the changes seen in the proposed rules will beconsistency between federal and state regulations concerningNSR. Owners or operators making facility modifications wouldnot incur the cost of procedures, upgrades to emission equip-ment, or the purchase of pollution credits that could be requiredunder federal NSR.

Industry would save costs by reducing the number of facility mod-ifications that would be subject to federal NSR. Fewer emissionincreases that result from facility modification would have to beoffset by emission reductions, upgrade of emission controls, orby the purchase of emission credits or allowances. The exactamount of cost savings at this time is not known due to the vari-ety of methods and operating systems employed by different en-tities in industry. However, savings could be as much as $40,000per ton of pollutant, the current market price of an emissioncredit, which an entity would have been required to purchase un-der NSR if emission calculations showed planned modificationswould increase emissions above the allowable amount.

SMALL BUSINESS AND MICRO-BUSINESS ASSESSMENT

No adverse fiscal implications are anticipated for small or micro-businesses. A small business is defined as having fewer than100 employees or less than $1 million in annual gross receipts. Amicro-business is defined as having no more than 20 employees.Typically, small or micro-businesses do not participate in the typeof industrial activities to which NSR, and therefore, NSR reformwould apply.

LOCAL EMPLOYMENT IMPACT STATEMENT

The commission reviewed this proposed rulemaking and deter-mined that a local employment impact statement is not requiredbecause the proposed rules do not adversely affect a local econ-omy in a material way for the first five years that the proposedrules are in effect.

DRAFT REGULATORY IMPACT ANALYSIS DETERMINATION

The commission reviewed the proposed rulemaking in light ofthe regulatory impact analysis requirements of Texas Govern-ment Code, §2001.0225 and determined that the proposed rule-making does not meet the definition of a "major environmentalrule." Furthermore, it does not meet any of the four applicabilityrequirements listed in Texas Government Code, §2001.0225(a).A "major environmental rule" means a rule, the specific intent ofwhich, is to protect the environment or reduce risks to humanhealth from environmental exposure, and that may adversely af-fect in a material way the economy, a sector of the economy, pro-ductivity, competition, jobs, the environment, or the public healthand safety of the state or a sector of the state. The proposedrulemaking would revise the rules regarding federal permittingapplicability, including adding additional options under federal airquality permitting applicability and plant-wide applicability limitoptions. The proposed rulemaking revises the existing pollu-tion control projects standard permit. In addition, the proposedrulemaking would modify and add definitions, and change somegeneral formatting of this chapter. The proposed rules will notadversely affect, in a material way, the economy, a sector of theeconomy, productivity, competition, jobs, the environment, or thepublic health and safety of the state or a sector of the state.

In addition, Texas Government Code, §2001.0225, only appliesto a major environmental rule, the result of which is to: 1) ex-ceed a standard set by federal law, unless the rule is specifi-cally required by state law; 2) exceed an express requirement ofstate law, unless the rule is specifically required by federal law;3) exceed a requirement of a delegation agreement or contractbetween the state and an agency or representative of the fed-eral government to implement a state and federal program; or 4)adopt a rule solely under the general powers of the agency in-stead of under a specific state law. The proposed rules do not ex-ceed a standard set by federal law or exceed an express require-ment of state law. The proposed rules do not incorporate federalNSR reform verbatim but provide for a different, yet equivalent,approach for implementation that is best suited to benefit Texas’industry and environment. This equivalence will also be demon-strated to EPA for these rules to be included in the SIP. There isno contract or delegation agreement that covers the topic that isthe subject of this rulemaking. Finally, this rulemaking was notdeveloped solely under the general powers of the agency, but isauthorized by specific sections of the THSC and the Texas Wa-ter Code (TWC) that are cited in the STATUTORY AUTHORITYsection of this preamble. Therefore, this rulemaking is not sub-ject to the regulatory analysis provisions of Texas Government



Code, §2001.0225(b), because the proposed rules do not meetany of the four applicability requirements.

The commission invites public comment regarding the draft reg-ulatory impact analysis determination during the public commentperiod.

TAKINGS IMPACT ASSESSMENT

The commission completed a takings impact analysis for the pro-posed rules, including adding additional options under federal airquality permitting applicability and plant-wide applicability limitoptions. The proposed rulemaking revises the existing pollutioncontrol projects standard permit. The specific purpose of thisrulemaking is to revise the rules regarding federal permitting ap-plicability. In addition, the proposed rulemaking would modifyand add definitions, and change some general formatting of thischapter. Promulgation and enforcement of the proposed ruleswould be neither a statutory nor a constitutional taking becausethey do not affect private real property. Specifically, the proposedrules do not affect private property in a manner which restrictsor limits an owner’s right to the property that would otherwiseexist in the absence of a governmental action. Therefore, theproposed rules do not constitute a takings under Texas Govern-ment Code, Chapter 2007.

CONSISTENCY WITH THE COASTAL MANAGEMENT PRO-GRAM

The commission determined that this rulemaking action relatesto an action or actions subject to the Texas Coastal ManagementProgram (CMP) in accordance with the Coastal Coordination Actof 1991, as amended (Texas Natural Resources Code, §§33.201et seq.), and the commission’s rules in 30 TAC Chapter 281, Sub-chapter B, concerning Consistency with the CMP. As required by§281.45(a)(3) and 31 TAC §505.11(b)(2), relating to Actions andRules Subject to the Coastal Management Program, the com-mission’s rules governing air pollutant emissions must be con-sistent with the applicable goals and policies of the CMP. Thecommission reviewed this action for consistency with the CMPgoals and policies in accordance with the rules of the CoastalCoordination Council, and determined that the action is consis-tent with the applicable CMP goals and policies. The CMP goalapplicable to this rulemaking action is the goal to protect, pre-serve, and enhance the diversity, quality, quantity, functions, andvalues of coastal natural resource areas (31 TAC §501.12(l)). Nonew sources of air contaminants will be authorized and the pro-posed revisions will maintain the same level of emissions controlas the existing rules. The CMP policy applicable to this rulemak-ing action is the policy that the commission’s rules comply withfederal regulations in 40 CFR, to protect and enhance air qualityin the coastal areas (31 TAC §501.14(q)). This rulemaking actioncomplies with 40 CFR Part 51, Requirements for Preparation,Adoption, and Submittal of Implementation Plans. Therefore, inaccordance with 31 TAC §505.22(e), the commission affirms thatthis rulemaking action is consistent with CMP goals and policies.

The commission solicits comments on the consistency of the pro-posed rulemaking with the CMP during the public comment pe-riod.

EFFECT ON SITES SUBJECT TO THE FEDERAL OPERATINGPERMITS PROGRAM

The new and amended sections in this proposal are applicablerequirements under Chapter 122. Upon the effective date of thisrulemaking, owners or operators subject to the Federal Operat-ing Permit Program that modify any NSR authorized sources at

their sites will be subject to the amended requirements of thesesections.

ANNOUNCEMENT OF HEARING

The commission will hold a public hearing on this proposal inAustin on October 27, 2005, at 2:00 p.m. in Building B, Room201A, at the commission’s central office located at 12100 Park35 Circle. The hearing is structured for the receipt of oral or writ-ten comments by interested persons. Individuals may presentoral statements when called upon in order of registration. Opendiscussion will not be permitted during the hearing; however,commission staff members will be available to discuss the pro-posal 30 minutes before the hearing and will answer questionsbefore and after the hearing.

Persons with disabilities who have special communication orother accommodation needs who are planning to attend thehearing should contact Joyce Spencer, Office of Legal Services,at (512) 239-5017. Requests should be made as far in advanceas possible.

SUBMITTAL OF COMMENTS

Comments may be submitted to Joyce Spencer, MC 205, TexasRegister Team, Office of Legal Services, P.O. Box 13087, Austin,Texas 78711-3087 or faxed to (512) 239-4808. Commentsmust be received by 5:00 p.m., October 31, 2005, and shouldreference Rule Project Number 2005-010-116-PR. Copies of theproposed rules can be obtained from the commission’s Web siteat http://www.tceq.state.tx.us/nav/rules/propose_adopt.html.For further information, please contact Beecher Cameron, AirPermits Division, at (512) 239-1495 or Kurt Kind, Air PermitsDivision, at (512) 239-1337.

SUBCHAPTER A. DEFINITIONS30 TAC §116.12

STATUTORY AUTHORITY

The amendment is proposed under TWC, §5.103, concerningRules, and §5.105, concerning General Policy, which authorizethe commission to adopt rules necessary to carry out its pow-ers and duties under the TWC; and under THSC, §382.017,concerning Rules, which authorizes the commission to adoptrules consistent with the policy and purposes of the TCAA. Theamendment is also proposed under THSC, §382.002, concern-ing Policy and Purpose, which establishes the commission pur-pose to safeguard the state’s air resources, consistent with theprotection of public health, general welfare, and physical prop-erty; §382.011, concerning General Powers and Duties, whichauthorizes the commission to control the quality of the state’s air;§382.012, concerning State Air Control Plan, which authorizesthe commission to prepare and develop a general, comprehen-sive plan for the control of the state’s air; §382.051, concern-ing Permitting Authority of Commission; Rules, which authorizesthe commission to issue permits and adopt rules necessary forpermits issued under THSC, Chapter 382; §382.0512, concern-ing Modification of Existing Facility, which establishes a modifica-tion and its limits; §382.0518, concerning Preconstruction Per-mit, which requires that a permit be obtained from the commis-sion prior to new construction or modification of an existing fa-cility; and Federal Clean Air Act (FCAA), 42 United States Code(USC), §§7401 et seq., which requires permits for constructionand operation of new or modified major stationary sources.



The proposed amendment implements THSC, §§382.002,382.011, 382.012, 382.051, 382.0512, and 382.0518; andFCAA, 42 USC, §§7401 et seq.

§116.12. Federal Permit [Nonattainment Review] Definitions.

Unless specifically defined in the Texas Clean Air Act (TCAA) or inthe rules of the commission, the terms used by the commission havethe meanings commonly ascribed to them in the field of air pollutioncontrol. The terms in this section are applicable to permit review formajor source construction and major source modification in nonattain-ment areas. In addition to the terms that are defined by the TCAA, andin §101.1 of this title (relating to Definitions), the following words andterms, when used in Chapter 116, Subchapter B, Divisions 5 and 6 ofthis title (relating to Nonattainment Review and Prevention of Signifi-cant Deterioration Review); and Chapter 116, Subchapter C, Division1 of this title (relating to Plant-Wide Applicability Limits) [§116.150and §116.151 of this title (relating to Nonattainment Review)], have thefollowing meanings, unless the context clearly indicates otherwise.

(1) Actual emissions--Actual emissions as of a particulardate are equal to the average rate, in tons per year, at which the unitactually emitted the pollutant during a two-year period that precedesthe particular date and that is representative of normal source opera-tion , except that this definition shall not apply for calculating whethera significant emissions increase has occurred, or for establishing aplant-wide applicability limit. Instead, paragraph (3) of this sectionshall apply for this purpose. The executive director shall allow the useof a different time period upon a determination that it is more represen-tative of normal source operation. Actual emissions shall be calculatedusing the unit’s actual operating hours, production rates, and types ofmaterials processed, stored, or combusted during the selected time pe-riod. The executive director may presume that the source-specific al-lowable emissions for the unit are equivalent to the actual emissions,e.g., when the allowable limit is reflective of actual emissions. For anyemissions unit that has not begun normal operations on the particulardate, actual emissions shall equal the potential to emit of the unit onthat date.

(2) (No change.)

(3) Baseline actual emissions--The average rate of actualemissions, in tons per year, of a federally regulated new source reviewpollutant.

(A) For any existing electric utility steam generatingunit, baseline actual emissions means the average rate, in tons per year,at which the unit actually emitted the pollutant during any consecutive24-month period selected by the owner or operator within the five-year period immediately preceding when the owner or operator beginsactual construction of the project. The reviewing authority shall allowthe use of a different time period upon a determination that it is morerepresentative of normal source operation.

(B) For an existing facility (other than an electric util-ity steam generating unit), baseline actual emissions means the averagerate, in tons per year, at which the facility actually emitted the pollu-tant during any consecutive 24-month period selected by the owner oroperator within the ten-year period immediately preceding either thedate the owner or operator begins actual construction of the project, orthe date a complete permit application is received for a permit. Theaverage rate shall be adjusted downward to exclude any emissions thatwould have exceeded an emission limitation with which the major sta-tionary source must currently comply with the exception of those re-quired under 40 Code of Federal Regulations, Part 63, had such majorstationary source been required to comply with such limitations duringthe consecutive 24-month period.

(C) For a new facility, the baseline actual emissions forpurposes of determining the emissions increase that will result fromthe initial construction and operation of such unit shall equal zero;and for all other purposes during the first two years following initialoperation, shall equal the unit’s potential to emit.

(D) The average actual rate shall be adjusted downwardto exclude any non-compliant emissions that occurred during the con-secutive 24-month period. For each regulated new source review pol-lutant, when a project involves multiple facilities, only one consecu-tive 24-month period must be used to determine the baseline actualemissions for the facilities being changed. A different consecutive24-month period can be used for each regulated new source reviewpollutant. The average rate shall not be based on any consecutive24-month period for which there is inadequate information for de-termining annual emissions, in tons per year, and for adjusting thisamount. Baseline emissions cannot occur prior to November 15, 1990.

(E) The average actual emissions rate shall includefugitive emissions to the extent quantifiable. Until March 1, 2016,emissions previously demonstrated as emissions events or historicallyexempted under Chapter 101 of this title (relating to General AirQuality Rules) may be included to the extent that they have beenauthorized, or are being authorized, in a permit action under Chapter106 of this title (relating to Permits by Rule) and this chapter.

(4) [(3)] Begin actual construction--In general, initiationof physical on-site construction activities on an emissions unit that areof a permanent nature. Such activities include, but are not limited to, in-stallation of building supports and foundations, laying of undergroundpipework, and construction of permanent storage structures. With re-spect to a change in method of operation, this term refers to thoseon-site activities other than preparatory activities that mark the initi-ation of the change.

(5) [(4)] Building, structure, facility, or installation--Allof the pollutant-emitting activities that belong to the same industrialgrouping, are located in one or more contiguous or adjacent properties,and are under the control of the same person (or persons under com-mon control). Pollutant-emitting activities are considered to be part ofthe same industrial grouping if they belong to the same "major group"(i.e., that have the same two-digit code) as described in the StandardIndustrial Classification Manual, 1972, as amended by the 1977 sup-plement.

(6) Clean coal technology--Any technology, includingtechnologies applied at the precombustion, combustion, or post-com-bustion stage, at a new or existing facility that will achieve significantreductions in air emissions of sulfur dioxide or oxides of nitrogenassociated with the utilization of coal in the generation of electricity,or process steam that was not in widespread use as of November 15,1990.

(7) Clean coal technology demonstration project--Aproject using funds appropriated under the heading "Departmentof Energy-Clean Coal Technology," up to a total amount of $2.5billion for commercial demonstration of clean coal technology, orsimilar projects funded through appropriations for the United StatesEnvironmental Protection Agency. The federal contribution fora qualifying project shall be at least 20% of the total cost of thedemonstration project.

(8) [(5)] Commence--As applied to construction of a ma-jor stationary source or major modification, means that the owner oroperator has all necessary preconstruction approvals or permits and ei-ther has:



(A) begun, or caused to begin, a continuous programof actual on-site construction of the source, to be completed within areasonable time; or

(B) entered into binding agreements or contractual obli-gations, which cannot be canceled or modified without substantial lossto the owner or operator, to undertake a program of actual constructionof the source to be completed within a reasonable time.

(9) [(6)] Construction--Any physical change or change inthe method of operation (including fabrication, erection, installation,demolition, or modification of an emissions unit) that would result ina change in actual emissions.

(10) [(7)] Contemporaneous period--For major sources theperiod between:

(A) the date that the increase from the particular changeoccurs; and

(B) 60 months prior to the date that construction on theparticular change commences.

(11) [(8)] De minimis threshold test (netting)--A method ofdetermining if a proposed emission increase will trigger nonattainmentor prevention of significant deterioration review. The summation of theproposed project emission increase in tons per year with all other cred-itable source emission increases and decreases during the contempora-neous period is compared to the major modification threshold [MAJORMODIFICATION column of Table I located in the definition of majormodification in this section] for that pollutant [specific nonattainmentarea]. If the major modification level is exceeded, then prevention ofsignificant deterioration and/or nonattainment review is required.

(12) Electric utility steam generating unit--Any steamelectric generating unit that is constructed for the purpose of supplyingmore than one-third of its potential electric output capacity and morethan 25 megawatts electrical output to any utility power distributionsystem for sale. Any steam supplied to a steam distribution systemfor the purpose of providing steam to a steam-electric generatorthat would produce electrical energy for sale is also considered indetermining the electrical energy output capacity of the affectedfacility.

(13) Federally regulated new source review pollutant--Asdefined in subparagraphs (A) - (D) of this paragraph:

(A) any pollutant for which a national ambient air qual-ity standard has been promulgated and any constituents or precursorsfor such pollutants identified by the United States Environmental Pro-tection Agency;

(B) any pollutant that is subject to any standard pro-mulgated under Federal Clean Air Act (FCAA), §111;

(C) any Class I or II substance subject to a standardpromulgated under or established by FCAA, Title VI; or

(D) any pollutant that otherwise is subject to regulationunder the FCAA; except that any or all hazardous air pollutants eitherlisted in FCAA, §112 or added to the list under FCAA, §112(b)(2),which have not been delisted under FCAA, §112(b)(3), are not reg-ulated new source review pollutants unless the listed hazardous airpollutant is also regulated as a constituent or precursor of a generalpollutant listed under FCAA, §108.

(14) [(9)] Lowest achievable emission rate--For any emit-ting facility, that rate of emissions of a contaminant that does not ex-ceed the amount allowable under applicable new source performance

standards promulgated by the United States Environmental ProtectionAgency under 42 United States Code, §7411, and that reflects the fol-lowing:

(A) the most stringent emission limitation that is con-tained in the rules and regulations of any approved state implementa-tion plan for a specific class or category of facility, unless the owner oroperator of the proposed facility demonstrates that such limitations arenot achievable; or

(B) the most stringent emission limitation that isachieved in practice by a specific class or category of facilities,whichever is more stringent.

(15) [(10)] Major [facility/] stationary source--Any[facility/] stationary source that emits, or has the potential to emit,a threshold quantity of emissions [the amount specified in theMAJOR SOURCE column of Table I located in the definition ofmajor modification in this section] or more of any air contaminant(including volatile organic compounds (VOCs) for which a nationalambient air quality standard has been issued. The major sourcethresholds are provided in Table I of this section for nonattain-ment pollutants and the major source thresholds for preventionof significant deterioration pollutants are identified in 40 Code ofFederal Regulations §51.166(b)(1). A source that is major for oneprevention of significant deterioration pollutant is considered majorfor all prevention of significant deterioration pollutants. Any physicalchange that would occur at a stationary source not qualifying as amajor stationary source will make the source major [in Table I of thissection], if the change would constitute a major stationary source byitself. A major stationary source that is major for VOCs or nitrogenoxides is considered to be major for ozone. The fugitive emissionsof a stationary source shall not be included in determining for any ofthe purposes of this definition whether it is a major stationary source,unless the source belongs to one of the categories of stationary sourceslisted in 40 Code of Federal Regulations §51.165(a)(1)(iv)(C).

(16) [(11)] Major modification--As follows.

(A) Any physical change in, or change in the method ofoperation of a major [facility/] stationary source that causes a signifi-cant project emissions increase and a significant net emissions increasefor any federally regulated new source review pollutant [air contami-nant for which a national ambient air quality standard (NAAQS) hasbeen issued]. At a [facility/] stationary source that is not major priorto the increase, the increase by itself must equal or exceed that speci-fied for a major source [in the MAJOR SOURCE column of Table I ofthis section]. At an existing major [facility/] stationary source, the in-crease must equal or exceed that specified for a major modification tobe significant. The major source and major modification thresholds areprovided in Table I of this section for nonattainment pollutants. Themajor source and significant thresholds for prevention of significantdeterioration pollutants are identified in 40 Code of Federal Regula-tions §51.166(b)(1) and (23), respectively. Any physical change in, orchange in the method of operation of a facility in a plant-wide applica-bility limit (PAL) that causes a significant project emissions increasefor any federally regulated new source review pollutant at non-PALfacilities is a major modification. [in the MAJOR MODIFICATIONcolumn of Table I.]Figure: 30 TAC §116.12(16)(A)[Figure: 30 TAC §116.12(11)(A)]

(B) A physical change or change in the method of op-eration shall not include:

(i) routine maintenance, repair, and replacement;



(ii) use of an alternative fuel or raw material by rea-son of an order under the Energy Supply and Environmental Coordina-tion Act of 1974, §2(a) and (b) (or any superseding legislation) or byreason of a natural gas curtailment plan under the Federal Power Act;

(iii) use of an alternative fuel by reason of an orderor rule of 42 United States Code, §7425;

(iv) use of an alternative fuel at a steam generatingunit to the extent that the fuel is generated from municipal solid waste;

(v) use of an alternative fuel or raw material by astationary source that the source was capable of accommodating beforeDecember 21, 1976 (unless such change would be prohibited under anyfederally enforceable permit condition established after December 21,1976) or the source is approved to use under any permit issued underregulations approved under this chapter;

(vi) an increase in the hours of operation or in theproduction rate (unless the change is prohibited under any federallyenforceable permit condition which was established after December21, 1976); [or]

(vii) any change in ownership at a stationary source;[.]

(viii) any change in emissions of a pollutant at a sitethat occurs under an existing plant-wide applicability limit unless theproject emission increases at non-PAL facilities are significant;

(ix) the installation, operation, cessation, or removalof a temporary clean coal technology demonstration project, providedthat the project complies with the state implementation plan and otherrequirements necessary to attain and maintain the national ambient airquality standard during the project and after it is terminated;

(x) for prevention of significant deterioration reviewonly, the installation or operation of a permanent clean coal technologydemonstration project that constitutes re-powering, provided that theproject does not result in an increase in the potential to emit of anyregulated pollutant emitted by the unit. This exemption shall apply ona pollutant-by-pollutant basis; or

(xi) for prevention of significant deteriorationreview only, the reactivation of a clean coal-fired electric utility steamgenerating unit.

(17) [(12)] Necessary preconstruction approvals or per-mits--Those permits or approvals required under federal air quality con-trol laws and regulations and those air quality control laws and regula-tions that are part of the applicable state implementation plan.

(18) [(13)] Net emissions increase--The amount by whichthe sum of the following exceeds zero: the total increase in actual emis-sions from a particular physical change or change in the method of op-eration at a stationary source, plus any sourcewide creditable contem-poraneous emission increases, minus any sourcewide creditable con-temporaneous emission decreases. Baseline actual emissions shall beused to determine emissions increases and decreases.

(A) An increase or decrease in [actual] emissions iscreditable only if both of the following conditions are met:

(i) it occurs during the contemporaneous period; and

(ii) the executive director has not relied on it in issu-ing a federal permit of same type [nonattainment permit] for the sourceand that permit is in effect [(under regulations approved during whichthe permit is in effect)] when the increase in [actual] emissions fromthe particular change occurs.

(B) An increase in [actual] emissions is creditable if itis the result of a physical change in, or change in the method of op-eration of a stationary source only to the extent that the new level of[actual] emissions exceeds the baseline actual emission rate. Emis-sion increases at facilities under a plant-wide applicability limit arenot creditable. [old level.]

(C) A decrease in [actual] emissions is creditable onlyto the extent that all of the following conditions are met:

(i) the baseline actual emission rate [old level of ac-tual emissions or the old level of allowable emissions, whichever islower,] exceeds the new level of [actual] emissions;

(ii) it is enforceable as a practical matter [federallyenforceable] at and after the time that actual construction on the partic-ular change begins;

(iii) the reviewing authority has not relied on it inissuing a prevention of significant deterioration, [or a] nonattainment, or plant-wide applicability limit permit; [permit, or the state has notrelied on the decrease to demonstrate attainment or reasonable furtherprogress; and]

(iv) the decrease has approximately the same quali-tative significance for public health and welfare as that attributed to theincrease from the particular change ; and [.]

(v) in the case of nonattainment applicability analy-sis only, the state has not relied on the decrease to demonstrate attain-ment or reasonable further progress.

(D) An increase that results from a physical change at asource occurs when the emissions unit on which construction occurredbecomes operational and begins to emit a particular pollutant. Anyreplacement unit that requires shakedown becomes operational onlyafter a reasonable shakedown period, not to exceed 180 days.

(19) [(14)] Offset ratio--For the purpose of satisfying theemissions offset reduction requirements of the 42 United States Code,§7503(a)(1)(A), the emissions offset ratio is the ratio of total actual re-ductions of emissions to total [allowable] emissions increases of suchpollutants. The minimum offset ratios are included in Table I of thissection under the definition of major modification [of this section]. Inorder for a reduction to qualify as an offset, it must be certified asan emission credit under Chapter 101, Subchapter H, Division 1 or 4of this title (relating to Emission Credit Banking or Trading; or Dis-crete Emission Credit Banking and Trading), except as provided for in§116.170(b) of this title (relating to Applicability of Emission Reduc-tions as Offsets). The reduction must not have been relied on in theissuance of a previous nonattainment, [or] prevention of significant de-terioration, or plant-wide applicability limit permit.

(20) Plant-wide applicability limit--An emission limitationexpressed, in tons per year, for a pollutant at a major stationary source,that is enforceable as a practical matter and established in a plant-wide applicability limit permit under §116.186 of this title (relating toGeneral and Special Conditions).

(21) Plant-wide applicability limit effective date--The dateof issuance of the plant-wide applicability limit permit. The plant-wideapplicability limit effective date for a plant-wide applicability limitestablished in an existing flexible permit is the date that the flexiblepermit was issued.

(22) Plant-wide applicability limit major modifica-tion--Any physical change in, or change in the method of operationof the plant-wide applicability limit source that causes it to emit theplant-wide applicability limit pollutant at a level equal to or greaterthan the plant-wide applicability limit.



(23) Plant-wide applicability limit permit--The state orfederal new source review permit that establishes the plant-wideapplicability limit.

(24) Plant-wide applicability limit pollutant--The pollutantfor which a plant-wide applicability limit is established.

(25) [(15)] Potential to emit--The maximum capacity of a[facility/] stationary source to emit a pollutant under its physical andoperational design. Any physical or enforceable operational limita-tion on the capacity of the [facility/] stationary source to emit a pollu-tant, including air pollution control equipment and restrictions on hoursof operation or on the type or amount of material combusted, stored,or processed, may be treated as part of its design only if the limita-tion or the effect it would have on emissions is federally enforceable.Secondary emissions, as defined in 40 Code of Federal Regulations§51.165(a)(1)(viii), do not count in determining the potential to emitfor a stationary source.

(26) [(16)] Project net--The sum of the following: the to-tal proposed increase in emissions resulting from a physical changeor change in the method of operation at a stationary source, minusany sourcewide creditable [actual] emission decreases proposed at thesource between the date of application for the modification and thedate the resultant modification begins emitting. Baseline actual emis-sions shall be used to determine emissions increases and decreases.Increases and decreases must meet the creditability criteria listed un-der the definition of net emissions increase in this section.

(27) Projected actual emissions--The maximum annualrate, in tons per year, at which an existing facility is projectedto emit a federally regulated new source review pollutant in anyrolling 12-month period during the five years following the date thefacility resumes regular operation after the project, or in any one ofthe ten years following that date, if the project involves increasingthe facility’s design capacity or its potential to emit that federallyregulated new source review pollutant. In determining the projectedactual emissions, the owner or operator of the major stationarysource shall include fugitive emissions to the extent quantifiable andshall consider all relevant information, including, but not limited to,historical operational data, the company’s own representations, thecompany’s expected business activity and the company’s highestprojections of business activity, the company’s filings with the stateor federal regulatory authorities, and compliance plans under theapproved state implementation plan.

(28) Project emissions increase--The sum of emissions in-creases for each modified or affected facility determined using the fol-lowing methods:

(A) for existing facilities, the difference between theprojected actual emissions and the baseline actual emissions. In cal-culating any increase in emissions that results from the project, thatportion of the facility’s emissions following the project that the facil-ity could have accommodated during the consecutive 24-month periodused to establish the baseline actual emissions and that are also unre-lated to the particular project, including any increased utilization dueto product demand growth may be excluded from the project emissionincrease. The potential to emit from the facility following completionof the project may be used in lieu of the projected actual emission rate;and

(B) for new facilities, the difference between the poten-tial to emit from the facility following completion of the project andthe baseline actual emissions.

(29) [(17)] Secondary emissions--Emissions that wouldoccur as a result of the construction or operation of a major stationary

source or major modification, but do not come from the source or mod-ification itself. Secondary emissions must be specific, well-defined,quantifiable, and impact the same general area as the stationary sourceor modification that causes the secondary emissions. Secondaryemissions include emissions from any off-site support facility thatwould not be constructed or increase its emissions, except as a result ofthe construction or operation of the major stationary source or majormodification. Secondary emissions do not include any emissions thatcome directly from a mobile source such as emissions from the tailpipe of a motor vehicle, from a train, or from a vessel.

(30) [(18)] Stationary source--Any building, structure, fa-cility, or installation that emits or may emit any air pollutant subject toregulation under 42 United States Code, §§7401 et seq.

(31) Temporary clean coal technology demonstrationproject--A clean coal technology demonstration project that isoperated for a period of five years or less, and that complies with thestate implementation plan and other requirements necessary to attainand maintain the national ambient air quality standards during theproject and after it is terminated.



2005.


♦ ♦ ♦SUBCHAPTER B. NEW SOURCE REVIEWPERMITSDIVISION 1. PERMIT APPLICATION30 TAC §116.121

STATUTORY AUTHORITY

The new section is proposed under TWC, §5.103, concerningRules, and §5.105, concerning General Policy, which authorizethe commission to adopt rules necessary to carry out its powersand duties under the TWC; and under THSC, §382.017, con-cerning Rules, which authorizes the commission to adopt rulesconsistent with the policy and purposes of the TCAA. The newsection is also proposed under THSC, §382.002, concerningPolicy and Purpose, which establishes the commission purposeto safeguard the state’s air resources, consistent with the pro-tection of public health, general welfare, and physical property;§382.011, concerning General Powers and Duties, which au-thorizes the commission to control the quality of the state’s air;§382.012, concerning State Air Control Plan, which authorizesthe commission to prepare and develop a general, comprehen-sive plan for the control of the state’s air; §382.051, concerningPermitting Authority of Commission; Rules, which authorizes thecommission to issue permits and adopt rules necessary for per-mits issued under THSC, Chapter 382; §382.0512, concerningModification of Existing Facility, which establishes a modificationand its limits; §382.0518, concerning Preconstruction Permit,



which requires that a permit be obtained from the commissionprior to new construction or modification of an existing facility;and FCAA, 42 USC, §§7401 et seq., which requires permits forconstruction and operation of new or modified major stationarysources.

The proposed new section implements THSC, §§382.002,382.011, 382.012, 382.051, 382.0512, and 382.0518; andFCAA, 42 United States Code, §§7401 et seq.

§116.121. Actual to Projected Actual and Emissions Exclusion Testfor Emissions Increases.

(a) If projected actual emissions are used or emissions are ex-cluded from the emission increase resulting from the project, the owneror operator shall document and maintain a record of the following in-formation before beginning construction, and this information will beprovided as part of the notification, certification, registration, or appli-cation submitted to the executive director to claim or apply for statenew source review authorization for the project. If the emissions unitis an existing electric utility steam generating unit, the owner or oper-ator shall provide a copy of this information to the executive directorbefore beginning actual construction:

(1) a description of the project;

(2) identification of the facilities of which emissions of afederally regulated new source review pollutant could be affected bythe project; and

(3) a description of the applicability test used to determinethat the project is not a major modification for any pollutant, includ-ing the baseline actual emissions, the projected actual emissions, theamount of emissions excluded from the project emissions increase andan explanation for why such amount was excluded, and any netting cal-culations, if applicable.

(b) If projected actual emissions are used to determine theproject emission increase at a facility, the owner or operator shall mon-itor the emissions of any regulated new source review pollutant thatcould increase as a result of the project at that facility and calculateand maintain a record of the annual emissions from that facility, in tonsper year, on a calendar year basis for:

(1) a period of five years following resumption of regularoperations after the change; or

(2) a period of ten years following resumption of regularoperations after the change if the project increases the design capacityor potential to emit of that regulated new source review pollutant atthat facility.

(c) If the facility is an electric utility steam generating unit,the owner or operator shall submit a report to the executive directorwithin 60 days after the end of each year of which records must bemaintained setting out the unit’s annual emissions during the calendaryear that preceded submission of the report.

(d) If the facility is not an electric utility steam generating unit,the owner or operator shall submit a report to the executive directorif the annual emissions from the project exceed the baseline actualemissions by a significant amount for that pollutant, and the emissionsexceed the preconstruction projection for any facility. The report shallbe submitted to the executive director within 60 days after the end ofsuch year. The report shall contain:

(1) the name, address, and telephone number of the majorstationary source; and

(2) the calculated actual annual emissions.

(e) The owner or operator of the facility shall make the re-quired information maintained to document projected actual emissionsand any emissions excluded from the project emission increase avail-able for review upon request for inspection by the executive director,local air pollution control program, and the general public.



2005.


♦ ♦ ♦DIVISION 5. NONATTAINMENT REVIEWPERMITS30 TAC §116.150, §116.151

STATUTORY AUTHORITY

The amendments are proposed under TWC, §5.103, con-cerning Rules, and §5.105, concerning General Policy, whichauthorize the commission to adopt rules necessary to carryout its powers and duties under the TWC; and under THSC,§382.017, concerning Rules, which authorizes the commissionto adopt rules consistent with the policy and purposes of theTCAA. The amendments are also proposed under THSC,§382.002, concerning Policy and Purpose, which establishesthe commission purpose to safeguard the state’s air resources,consistent with the protection of public health, general welfare,and physical property; §382.011, concerning General Powersand Duties, which authorizes the commission to control thequality of the state’s air; §382.012, concerning State Air ControlPlan, which authorizes the commission to prepare and developa general, comprehensive plan for the control of the state’sair; §382.051, concerning Permitting Authority of Commission;Rules, which authorizes the commission to issue permits andadopt rules necessary for permits issued under THSC, Chapter382; §382.0512, concerning Modification of Existing Facility,which establishes a modification and its limits; §382.0518,concerning Preconstruction Permit, which requires that a permitbe obtained from the commission prior to new construction ormodification of an existing facility; and FCAA, 42 USC, §§7401et seq., which requires permits for construction and operation ofnew or modified major stationary sources.

The proposed amendments implement THSC, §§382.002,382.011, 382.012, 382.051, 382.0512, and 382.0518; andFCAA, 42 USC, §§7401 et seq.

§116.150. New Major Source or Major Modification in Ozone Nonat-tainment Areas.

(a) (No change.)

(b) The owner or operator of a proposed new [or modified fa-cility that will be a new] major stationary source , as defined in §116.12of this title (relating to Federal Permit Definitions) of volatile organiccompound (VOC) emissions or nitrogen oxides (NO

x) emissions, or the



owner or operator of an existing [major] stationary source of VOC orNO

xemissions that will undergo a major modification, as defined in

§116.12 of this title with respect to VOC or NOx, shall meet the re-

quirements of subsection (e)(1) - (4) of this section, except as providedin subsection (f) of this section. Table I, located in the definition ofmajor modification [modifications] in §116.12 of this title, [(relatingto Nonattainment Review Definitions)] specifies the various classifica-tions of nonattainment along with the associated emission levels thatdesignate a major stationary source or major modification for thoseclassifications.

(c) - (d) (No change.)

(e) In applying the de minimis threshold test, if the netemissions increases, aggregated over the contemporaneous period, aregreater than the major modification levels stated in Table I located inthe definition of major modification in §116.12 of this title, then thefollowing requirements apply.

(1) The proposed facility shall comply with the lowestachievable emission rate (LAER) as defined in §116.12 of this titlefor the nonattainment pollutants for which the facility is a newmajor source or major modification except as provided in paragraph(3)(B) of this subsection and except for existing major stationarysources that have a potential to emit (PTE) of less than 100 tpy of theapplicable nonattainment pollutant. For these sources, best availablecontrol technology (BACT) can be substituted for LAER. LAER shallotherwise be applied to each new facility [emission unit] and to eachexisting facility [emission unit] at which the net emissions increasewill occur as a result of a physical change or change in method ofoperation of the unit.

(2) - (4) (No change.)

(f) (No change.)

§116.151. New Major Source or Major Modification in Nonattain-ment Area Other Than Ozone.

(a) This section applies to [administratively complete] appli-cations [submitted on or after November 15, 1992,] for new construc-tion or modification of facilities located in a designated nonattainmentarea for an air contaminant other than ozone. The owner or operator ofa proposed new or modified facility that [which] will be a new majorstationary source for that nonattainment air contaminant, or the owneror operator of an existing major stationary source that will undergo amajor modification with respect to that nonattainment air contaminant,shall meet the additional requirements of subsection (c) [paragraphs](1) - (4) of this section. Table I of §116.12 of this title (relating toFederal Permit [Nonattainment Review] Definitions) specifies the var-ious classifications of nonattainment along with the associated emis-sion levels that [which] designate a major stationary source [or majormodification for those classifications].

(b) The de minimis threshold test (netting) is required for allmodifications to existing major sources of federally regulated newsource review pollutants, unless the proposed emissions increases as-sociated with a project, without regard to decreases, are less than themajor modification threshold for the pollutant identified in Table I of§116.12 of this title.

(c) In applying the de minimis threshold test, if the netemissions increases, aggregated over the contemporaneous period, aregreater than the major modification levels stated in Table I of §116.12of this title, the following requirements apply.

(1) The proposed facility shall comply with the lowestachievable emission rate (LAER) as defined in §116.12 of this titlefor the nonattainment pollutants for which the facility is a new majorsource or major modification. LAER shall be applied to each new

facility [emission unit] and to each existing facility [emission unit] atwhich the net emissions increase will occur as a result of a physicalchange or change in method of operation of the unit.

(2) All major stationary sources owned or operated by theapplicant (or by any person controlling, controlled by, or under com-mon control with the applicant) in the state shall be in compliance oron a schedule for compliance with all applicable state and federal emis-sion limits and standards.

(3) At the time the new or modified facility or facilitiescommence operation, the emission increases from the new or modifiedfacility or facilities shall be offset. The proposed facility shall use theoffset ratio for the appropriate nonattainment classification as definedin §116.12 of this title and shown in Table I of §116.12 of this title.

(4) In accordance with the Federal Clean Air Act, the per-mit application shall contain an analysis of alternative sites, sizes, pro-duction processes, and control techniques for the proposed source. Theanalysis shall demonstrate that the benefits of the proposed location andsource configuration significantly outweigh the environmental and so-cial costs of that location.



2005.


♦ ♦ ♦DIVISION 6. PREVENTION OF SIGNIFICANTDETERIORATION REVIEW30 TAC §116.160

STATUTORY AUTHORITY

The amendment is proposed under TWC, §5.103, concerningRules, and §5.105, concerning General Policy, which authorizethe commission to adopt rules necessary to carry out its pow-ers and duties under the TWC; and under THSC, §382.017,concerning Rules, which authorizes the commission to adoptrules consistent with the policy and purposes of the TCAA. Theamendment is also proposed under THSC, §382.002, concern-ing Policy and Purpose, which establishes the commission pur-pose to safeguard the state’s air resources, consistent with theprotection of public health, general welfare, and physical prop-erty; §382.011, concerning General Powers and Duties, whichauthorizes the commission to control the quality of the state’s air;§382.012, concerning State Air Control Plan, which authorizesthe commission to prepare and develop a general, comprehen-sive plan for the control of the state’s air; §382.051, concerningPermitting Authority of Commission; Rules, which authorizes thecommission to issue permits and adopt rules necessary for per-mits issued under THSC, Chapter 382; §382.0512, concerningModification of Existing Facility, which establishes a modificationand its limits; §382.0518, concerning Preconstruction Permit,which requires that a permit be obtained from the commission



prior to new construction or modification of an existing facility;and FCAA, 42 USC, §§7401 et seq., which requires permits forconstruction and operation of new or modified major stationarysources.

The proposed amendment implements THSC, §§382.002,382.011, 382.012, 382.051, 382.0512, and 382.0518; andFCAA, 42 USC, §§7401 et seq.

§116.160. Prevention of Significant Deterioration Requirements.

(a) Each proposed new major source or major modification inan attainment or unclassifiable area shall comply with the requirementsof this section. The owner or operator of a proposed new or modifiedfacility that will be a new major stationary source for the preventionof significant deterioration air contaminant shall meet the additionalrequirements of subsection (c)(1) - (4) of this section. [Prevention ofSignificant Deterioration (PSD) of Air Quality regulations promulgatedby the EPA in Title 40 Code of Federal Regulations (CFR) at 40 CFR§52.21 as amended March 12, 1996 and the Definitions for Protectionof Visibility promulgated at 40 CFR §51.301 as amended July 1, 1999,hereby incorporated by reference.]

(b) The de minimis threshold test (netting) is required for allmodifications to existing major sources of federally regulated newsource review pollutants, unless the proposed emissions increases as-sociated with a project, without regard to decreases, are less than majormodification thresholds for the pollutant identified in 40 Code of Fed-eral Regulations (CFR) §52.21(b)(23).

(c) In applying the de minimis threshold test (netting), if thenet emissions increases, aggregated over the contemporaneous period,are greater than the major modification levels for the pollutant identi-fied in 40 CFR 52.21(b)(23), the following requirements apply.

(1) In addition to those definitions in §116.12 of this ti-tle (relating to Federal Permit Definitions) the following definitionsfrom prevention of significant deterioration of air quality regulationspromulgated by the United States Environmental Protection Agency(EPA) in 40 CFR §52.21 and the definitions for protection of visibil-ity and promulgated in 40 CFR §51.301 as amended July 1, 1999, areincorporated by reference:

(A) 40 CFR §52.21(b)(13) - (15), concerning baselineconcentrations, dates, and areas;

(B) 40 CFR §52.21(b)(19), concerning innovative con-trol technology; and

(C) 40 CFR §52.21(b)(24) - (28), concerning federalland manager, terrain, and Indian reservations/governing bodies.

(2) The following requirements from prevention of signif-icant deterioration of air quality regulations promulgated by the EPAin 40 CFR §52.21 are hereby incorporated by reference:

(A) 40 CFR §52.21(c) - (i), concerning increments, am-bient air ceilings, restrictions on area classifications, exclusions fromincrement consumption, redesignation, stack heights, and exemptions;

(B) 40 CFR §52.21(k), concerning source impact anal-ysis;

(C) 40 CFR §52.21(m) - (p), concerning air qualityanalysis, source information, additional impact analysis, and sourcesimpacting federal Class I areas; and

(D) 40 CFR §52.21(v), concerning innovative technol-ogy.

(3) The term "facility" shall replace the words "emissionsunit" in the referenced sections of the CFR.

(4) A determination to issue or not issue a permit shall bemade within one year after receipt of a complete permit application,provided a contested case hearing has not been called on the applica-tion.

[(b) The following paragraphs are excluded:]

[(1) 40 CFR §52.21(j), concerning control technology re-view;]

[(2) 40 CFR §52.21(l), concerning air quality models;]

[(3) 40 CFR §52.21(q), concerning public notification(provided, however, that a determination to issue or not issue a permitshall be made within one year after receipt of a complete permitapplication so long as a contested case hearing has not been called onthe application);]

[(4) 40 CFR §52.21(r)(2), concerning source obligation;]

[(5) 40 CFR §52.21(s), concerning environmental impactstatements;]

[(6) 40 CFR §52.21(u), concerning delegation of authority;and]

[(7) 40 CFR §52.21(w), concerning permit rescission.]

[(c) The definitions of building, structure, facility, or in-stallation (40 CFR §52.21(b)(6)) and secondary emissions (40 CFR§52.21(b)(18)) are excluded and replaced with the following defini-tions:]

[(1) building, structure, facility, or installation - all of thepollutant-emitting activities which belong to the same industrial group-ing, are located on one or more contiguous or adjacent properties, andare under the control of the same person (or persons under commoncontrol). Pollutant-emitting activities shall be considered as part of thesame industrial grouping if they belong to the same "Major Group" (i.e.,which have the same first two-digit code) as described in the StandardIndustrial Classification Manual, 1972, as amended by the 1977 sup-plement.]

[(2) secondary emissions - emissions which would occur asa result of the construction or operation of a major stationary source ormajor modification, but do not come from the major stationary sourceor major modification itself. Secondary emissions include emissionsfrom any offsite support facility which would not be constructed or in-crease its emission except as a result of the construction or operationof the major stationary source or major modification. Secondary emis-sions do not include any emissions which come directly from a mobilesource, such as emissions from the tailpipe of a motor vehicle, from atrain, or from a vessel.]

[(d) The term "executive director" shall replace the word "ad-ministrator," except in 40 CFR §52.21(b)(17), (f)(1)(v), (f)(3), (f)(4)(i),(g), and (t). "Administrator or executive director" shall replace "admin-istrator" in 40 CFR §52.21(b)(3)(iii), and "administrator and executivedirector" shall replace "administrator" in 40 CFR §52.21(p)(2).]

(d) [(e)] All estimates of ambient concentrations required un-der this subsection shall be based on the applicable air quality modelsand modeling procedures specified in the EPA Guideline on Air Qual-ity Models, as amended, or models and modeling procedures currentlyapproved by the EPA for use in the state program, and other specificprovisions made in the prevention of significant deterioration [PSD]state implementation plan. If the air quality impact model approved bythe EPA or specified in the guideline is inappropriate, the model maybe modified or another model substituted on a case-by-case basis, or ageneric basis for the state program, where appropriate. Such a change



shall be subject to notice and opportunity for public hearing and writ-ten approval of the administrator of the EPA.



2005.


♦ ♦ ♦SUBCHAPTER C. HAZARDOUS AIRPOLLUTANTS: REGULATIONS GOVERNINGCONSTRUCTED OR RECONSTRUCTEDMAJOR SOURCES (FCAA, SECTION 112(G), 40CFR PART 63)30 TAC §§116.180 - 116.183

(Editor’s note: The text of the following sections proposed for repealwill not be published. The sections may be examined in the offices of theTexas Commission on Environmental Quality or in the Texas Registeroffice, Room 245, James Earl Rudder Building, 1019 Brazos Street,Austin.)

STATUTORY AUTHORITY

The repeals are proposed under TWC, §5.103, concerningRules, and §5.105, concerning General Policy, which authorizethe commission to adopt rules necessary to carry out itspowers and duties under the TWC; and under THSC, §382.017,concerning Rules, which authorizes the commission to adoptrules consistent with the policy and purposes of the TCAA.The repeals are also proposed under THSC, §382.002, con-cerning Policy and Purpose, which establishes the commissionpurpose to safeguard the state’s air resources, consistent withthe protection of public health, general welfare, and physicalproperty; §382.011, concerning General Powers and Duties,which authorizes the commission to control the quality ofthe state’s air; §382.012, concerning State Air Control Plan,which authorizes the commission to prepare and develop ageneral, comprehensive plan for the control of the state’s air;§382.051, concerning Permitting Authority of Commission;Rules, which authorizes the commission to issue permits andadopt rules necessary for permits issued under THSC, Chapter382; §382.0512, concerning Modification of Existing Facility,which establishes a modification and its limits; §382.0518,concerning Preconstruction Permit, which requires that a permitbe obtained from the commission prior to new construction ormodification of an existing facility; and FCAA, 42 USC, §§7401et seq., which requires permits for construction and operation ofnew or modified major stationary sources.

The proposed repeals implement THSC, §§382.002, 382.011,382.012, 382.051, 382.0512, and 382.0518; and FCAA, 42 USC,§§7401 et seq.


§116.181. Exclusions.§116.182. Application.§116.183. Public Notice Requirements.This agency hereby certifies that the proposal has been reviewedby legal counsel and found to be within the agency’s legal author-ity to adopt.


2005.


♦ ♦ ♦SUBCHAPTER C. PLANT-WIDEAPPLICABILITY LIMITSDIVISION 1. PLANT-WIDE APPLICABILITYLIMITS30 TAC §§116.180, 116.182, 116.184, 116.186, 116.188,116.190, 116.192, 116.194, 116.196, 116.198

STATUTORY AUTHORITY

The new sections are proposed under TWC, §5.103, concerningRules, and §5.105, concerning General Policy, which authorizethe commission to adopt rules necessary to carry out its powersand duties under the TWC; and under THSC, §382.017, con-cerning Rules, which authorizes the commission to adopt rulesconsistent with the policy and purposes of the TCAA. The newsections are also proposed under THSC, §382.002, concerningPolicy and Purpose, which establishes the commission purposeto safeguard the state’s air resources, consistent with the pro-tection of public health, general welfare, and physical property;§382.011, concerning General Powers and Duties, which au-thorizes the commission to control the quality of the state’s air;§382.012, concerning State Air Control Plan, which authorizesthe commission to prepare and develop a general, comprehen-sive plan for the control of the state’s air; §382.051, concerningPermitting Authority of Commission; Rules, which authorizes thecommission to issue permits and adopt rules necessary for per-mits issued under THSC, Chapter 382; §382.0512, concerningModification of Existing Facility, which establishes a modificationand its limits; §382.0518, concerning Preconstruction Permit,which requires that a permit be obtained from the commissionprior to new construction or modification of an existing facility;and FCAA, 42 USC, §§7401 et seq., which requires permits forconstruction and operation of new or modified major stationarysources.

The proposed new sections implement THSC, §§382.002,382.011, 382.012, 382.051, 382.0512, and 382.0518; andFCAA, 42 USC, §§7401 et seq.

§116.180. Applicability.(a) The following requirements apply to a plant-wide applica-

bility limit (PAL) permit.

(1) Only one PAL may be issued for each pollutant at anaccount site.



(2) A PAL permit may include more than one PAL.

(3) A PAL permit may not cover facilities at more than onesource.

(4) A PAL permit may be may be consolidated with a stateor federal permit at the source.

(b) The new owner of a facility, group of facilities, or accountshall comply with §116.110(e) of this title (relating to Applicability),provided that all facilities covered by a PAL permit change ownershipat the same time and to the same person, or both the new owner andexisting permit holder must obtain a PAL permit alteration allocatingthe emission prior to the transfer of the permit by the commission.After the sale of a facility, or facilities, but prior to the transfer of apermit requiring a permit alteration, the original PAL permit holderremains responsible for ensuring compliance with the existing PALpermit and all rules and regulations of the commission.

(c) The owner of the facility, group of facilities, or accountor the operator of the facility, group of facilities, or account that isauthorized to act for the owner is responsible for complying with thissection, except as provided by subsection (b) of this section.

§116.182. Plant-wide Applicability Limit Permit Application.Any application for a new plant-wide applicability limit (PAL) permitor PAL permit amendment must include a completed application thatmust be signed by an authorized representative. In order to be granteda PAL permit or PAL permit amendment, the owner or operator ofthe proposed facility shall submit information to the commission thatdemonstrates that all of the following information is submitted:

(1) a list of all facilities, including their registration or per-mit number to be included in the PAL, their potential to emit, and theexpected maximum capacity. In addition, the owner or operator of thesource shall indicate which, if any, federal or state applicable require-ments, emission limitations, or work practices apply to each unit;

(2) calculations of the baseline actual emissions with sup-porting documentation;

(3) the calculation procedures that the permit holder pro-poses to use to convert the monitoring system data to monthly emis-sions and annual emissions based on a 12-month rolling total for eachmonth;

(4) use of best available control technology (BACT) at theproposed facility or group of facilities, with consideration given to thetechnical practicability and economic reasonableness of reducing oreliminating the emissions from the facility on a proposed facility, groupof facilities, or account basis. Control technology beyond BACT maybe used on certain facilities to provide the emission reductions neces-sary to comply with this requirement on a group of facilities or accountbasis, provided that the existing level of control may not be lessenedfor any facility. Until December 31, 2006, facilities authorized by aflexible permit under Subchapter G of this chapter (relating to Flexi-ble Permits) may satisfy this requirement on the basis of that review ifthe PAL effective period is limited to ten years from the date the PALpermit was issued. Facilities with flexible permits issued more thanten years ago must satisfy the control requirements for PAL permitrenewals and the PAL effective period is limited to 20 years after theflexible permit issuance date;

(5) the monitoring and recordkeeping proposed satisfy therequirements of §116.186 of this title (relating to General and SpecialConditions) for each PAL; and

(6) a control technology implementation schedule, if nec-essary, to satisfy the BACT requirement in paragraph (4) of this sec-tion.


The plant-wide applicability limit permit application will be reviewedby the commission in accordance with §116.114 of this title (relatingto Application Review Schedule).


(a) The plant-wide applicability limit (PAL) will impose anannual emission limitation in tons per year, that is enforceable as apractical matter, for all facilities included in the PAL. For each monthduring the PAL effective period after the first 12 months of establish-ing a PAL, the major stationary source owner or operator shall showthat the sum of the monthly emissions from each facility under thePAL for the previous 12 consecutive months is less than the PAL (a12-month average, rolled monthly). For each month during the first 11months from the PAL effective date, the major stationary source owneror operator shall show that the sum of the preceding monthly emissionsfrom the PAL effective date for each facility under the PAL is less thanthe PAL. Each PAL must include emissions of only one pollutant. ThePAL must include all emissions, including fugitive emissions, to theextent quantifiable, from all facilities included in the PAL that emit orhave the potential to emit the PAL pollutant.

(b) The following general conditions will be applicable to ev-ery PAL permit.

(1) Applicability. This section does not authorize any fa-cility to emit air pollutants but establishes an annual emissions levelbelow which new and modified facilities will not be subject to federalnew source review for that pollutant.

(2) Sampling requirements. If sampling of stacks orprocess vents is required, the PAL permit holder shall contact thecommission’s Office of Compliance and Enforcement prior to sam-pling to obtain the proper data forms and procedures. All samplingand testing procedures must be approved by the executive director andcoordinated with the appropriate regional office of the commission.The PAL permit holder is also responsible for providing samplingfacilities and conducting the sampling operations or contracting withan independent sampling consultant.

(3) Equivalency of methods. It shall be the responsibilityof the PAL permit holder to demonstrate or otherwise justify the equiv-alency of emission control methods, sampling or other emission testingmethods, and monitoring methods proposed as alternatives to methodsindicated in the conditions of the PAL permit. Alternative methodsmust be applied for in writing and must be reviewed and approved bythe executive director prior to their use in fulfilling any requirementsof the permit.

(4) Recordkeeping and reporting.

(A) A copy of the PAL permit along with informationand data sufficient to demonstrate continuous compliance with theemission caps contained in the PAL permit must be maintained in a fileat the plant site and made available at the request of personnel from theagency or any air pollution control program having jurisdiction. Forfacilities that normally operate unattended, this information must bemaintained at the nearest staffed location within Texas specified by thepermit holder in the permit application. This information may include,but is not limited to, emission cap and individual emission limitationcalculations based on a 12-month rolling basis and production recordsand operating hours. Additional recordkeeping requirements may bespecified in special conditions attached to the PAL permit.

(B) The owner or operator shall retain a copy of thePAL permit application and any applications for revisions to the PAL,each annual certification of compliance under §122.146 of this title(relating to Compliance Certification Terms and Conditions), and the



data relied on in certifying the compliance for the duration of the PALplus five years.

(5) Plantwide applicability limits. A PAL permit coversonly those sources of emissions and those air contaminants identifiedin the table attached to the permit.

(6) Maintenance of emission control. The facilities cov-ered by the PAL permit will not be operated unless all air pollu-tion emission capture and abatement equipment is maintained in goodworking order and operating properly during normal facility opera-tions.

(7) Compliance with rules. Acceptance of a PAL permitby a permit applicant constitutes an acknowledgment and agreementthat the holder will comply with all rules and orders of the commis-sion issued in conformity with the Texas Clean Air Act and the con-ditions precedent to the granting of the permit. If more than one stateor federal rule or PAL permit condition is applicable, then the moststringent limit or condition will govern and be the standard by whichcompliance must be demonstrated. Acceptance includes consent tothe entrance of commission employees and agents into the permittedpremises at reasonable times to investigate conditions relating to theemission or concentration of air contaminants, including compliancewith the PAL permit.

(8) Effective period. The PAL will be effective for tenyears.

(9) Absence of monitoring data. A source owner or opera-tor shall record and report maximum potential emissions without con-sidering enforceable emission limitations or operational restrictions fora facility during any period of time that there is no monitoring data,unless another method for determining emissions during such periodsis specified in the PAL permit special conditions.

(10) Re-validation. All data used to establish the PAL pol-lutant must be re-validated through performance testing or other scien-tifically valid means approved by the executive director. Such testingmust occur at least once every five years after issuance of the PAL.

(c) Each PAL permit must include special conditions that sat-isfy the following requirements.

(1) The PAL monitoring system must accurately determineall emissions of the PAL pollutant in terms of mass per unit of time.Any monitoring system authorized for use in the PAL permit must bebased on sound science and meet generally acceptable scientific proce-dures for data quality and manipulation. Additionally, the informationgenerated by such a system must meet minimum legal requirementsfor admissibility in a judicial proceeding to enforce the PAL permit.

(2) The PAL monitoring system must employ one or moreof the general monitoring approaches meeting the minimum require-ments as described in subparagraphs (A) - (D) of this paragraph.

(A) An owner or operator using mass balance calcula-tions to monitor PAL pollutant emissions from activities using coatingor solvents shall meet the following requirements:

(i) provide a demonstrated means of validating thepublished content of the PAL pollutant that is contained in, or createdby, all materials used in or at the facility;

(ii) assume that the facility emits all of the PAL pol-lutant that is contained in, or created by, any raw material or fuelused in or at the facility, if it cannot otherwise be accounted for inthe process; and

(iii) where the vendor of a material or fuel that isused in or at the facility publishes a range of pollutant content from

such material, the owner or operator shall use the highest value of therange to calculate the PAL pollutant emissions unless the executivedirector determines that there is site-specific data or a site-specificmonitoring program to support another content within the range.

(B) An owner or operator using a continuous emissionmonitoring system (CEMS) to monitor PAL pollutant emissions shallmeet the following requirements.

(i) The CEMS must comply with applicable perfor-mance specifications found in 40 Code of Federal Regulations Part 60,Appendix B.

(ii) The CEMS must sample, analyze, and recorddata at least every 15 minutes while the emissions unit is operating.

(C) An owner or operator using continuous parametermonitoring system (CPMS) or predictive emission monitoring system(PEMS) to monitor PAL pollutant emissions shall meet the followingrequirements.

(i) The CPMS or the PEMS must be based on cur-rent site-specific data demonstrating a correlation between the moni-tored parameter(s) and the PAL pollutant emissions across the rangeof operation of the facility.

(ii) Each CPMS or PEMS must sample, analyze,and record data at least every 15 minutes or at another less frequentinterval approved by the executive director, while the facility is oper-ating.

(D) An owner or operator using emission factors tomonitor PAL pollutant emissions shall meet the following requirement.

(i) All emission factors must be adjusted, if appro-priate, to account for the degree of uncertainty or limitations in thefactors’ development.

(ii) The facility must operate within the designatedrange of use for the emission factor, if applicable.

(iii) If technically practicable, the owner or operatorof a significant facility that relies on an emission factor to calculatePAL pollutant emissions shall conduct validation testing to determine asite-specific emission factor within six months of PAL permit issuance,unless the executive director determines that testing is not required.

(E) An alternative monitoring approach must meet therequirements in paragraph (1) of this subsection and be approved bythe executive director.

(3) Where an owner or operator of a facility cannot demon-strate a correlation between a monitored parameter(s) and the PAL pol-lutant emissions rate at all operating points of the facility, the executivedirector shall:

(A) establish default value(s) for determining compli-ance with the PAL based on the highest potential emissions reasonablyestimated at such operating point(s); or

(B) determine that operation of the facility during op-erating conditions when there is no correlation between monitored pa-rameter(s) and the PAL pollutant emissions is a violation of the PAL.

(4) If a facility requires the installation of additionalcontrols to meet the best available control technology requirement in§116.182(4) of this title (relating to Plant-wide Applicability LimitPermit Application) for the pollutant, the PAL permit must specify animplementation schedule for such additional controls.




The plant-wide applicability limit (PAL) will be established as the sumof the baseline actual emissions of the PAL pollutant for each existingfacility at the source to be covered. The allowable emission rate maybe used for facilities that did not exist in the baseline period.

(1) An amount equal to the applicable significant level forthe PAL pollutant may be added to the baseline actual emissions whenestablishing the PAL, but that quantity must be added to the result ofthe project emission increase at non-PAL facilities for any physicalchange, or change in the method of operation of a facility in the PAL.The amount must also be added to the result of the de minimis thresholdtest for any physical change, or change in the method of operation ofa non-PAL facility.

(2) When establishing the PAL level for a PAL pollutant,only one consecutive 24-month period must be used to determine thebaseline actual emissions for all existing facilities. However, a differ-ent consecutive 24-month period may be used for each different PALpollutant.

(3) A PAL established concurrently with a federal majormodification will be determined as follows. Prior to the start of op-eration of the new or modified facilities subject to federal NSR, thePAL shall be determined using baseline emissions as identified in§116.182(1) and (2) of this title (relating to Plant-wide ApplicabilityLimit Permit Application). Upon the start of operation of the new ormodified facilities subject to the major modification under preventionof significant deterioration and/or nonattainment review, as applica-ble, these facilities will contribute the authorized allowable emissionrates to the PAL. Any baseline emissions associated with these facili-ties must be removed from the PAL at that time.

(4) The executive director shall specify a reducedPAL level(s) in the PAL permit to become effective on the futurecompliance date(s) of any applicable federal or state regulatoryrequirement(s) that is effective prior to issuance of the PAL permit.

§116.190. Federal Nonattainment and Prevention of Significant De-terioration Review.

(a) An increase in emissions from operational or physicalchanges at a facility covered by a plant-wide applicability limit (PAL)permit is insignificant, for the purposes of federal new source reviewunder this subchapter, if the increase does not exceed the PAL.

(b) At no time are emissions reductions of a PAL pollutant thatoccur during the PAL effective period creditable as decreases for pur-poses of offsets, unless the level of the PAL is reduced by the amountof such emissions reductions and such reductions would be creditablein the absence of the PAL.


(a) Any increase in a plant-wide applicability limit (PAL)must be made through amendment. The new or modified facilitiescausing the need for the increase in the PAL must be reviewed priorto start of construction as a major modification under prevention ofsignificant deterioration and/or nonattainment review, as applicable,for each pollutant requiring an increase in a PAL. The PAL mustbe reestablished concurrently with the issued or amended permitby adding the authorized allowable emission rates for the new ormodified facilities to the baseline emissions for operating facilitiesused to establish the issued or renewed PAL for the remainingfacilities. Amendments must also include the information identifiedin §116.182 of this title (relating to Plant-wide Applicability LimitPermit Application) for new and modified facilities to be includedin the PAL and are subject to the public notice requirements under§116.194 of this title (relating to Public Notice and Comment). ThePAL level will be increased effective on the day each facility that is

part of the PAL major modification becomes operational and emitsthe PAL pollutant.

(b) Any changes to the control technology proposed to satisfy§116.182(4) of this title must be made through amendment. Thesechanges shall include information necessary to demonstrate that theproposed change satisfies those requirements. Changes to the imple-mentation schedule must be requested through permit alteration.

(c) Changes to PAL permits that do not require the PAL tobe increased must be completed through permit alteration. Unlessallowed in the PAL permit special conditions, the permit holder shallsubmit an alteration request prior to start of construction for physicalmodifications to facilities or installation of new facilities under thePAL. Approval must be received from the executive director prior tostart of operation of the facilities if the emissions from the new ormodified facilities may exceed 100 tons per year.


The applicant shall also provide for public notice on the draft plant-wide applicability limit permit in accordance with Chapter 39, Sub-chapters H and K of this title (relating to Applicability and GeneralProvisions; and Public Notice of Air Quality Applications) for all ini-tial applications, amendments, and renewals of a plant-wide applica-bility limit permit.


(a) A stationary source owner or operator shall submit a timelyapplication to the executive director to request renewal of a plant-wideapplicability limit (PAL) permit. A timely application is one that issubmitted at least six months prior to, but not earlier than 18 monthsfrom, the date of permit expiration. If the owner or operator of astationary source submits a complete application to renew the PALpermit within this time period, then the permit will continue to beeffective until the revised permit with the renewed PAL is issued orthe PAL permit is voided.

(b) All PAL permits issued prior to the effective date of thissection are subject to the renewal requirements under this section.These permits must be renewed by December 31, 2006, or within thetime frame specified in subsection (a) of this section, whichever islater.

(c) The following information must be submitted with a PALrenewal application:

(1) a proposed PAL level;

(2) an identification of the facilities that are qualified asdefined in §116.10 of this title (relating to General Definitions) withsupporting documentation;

(3) the sum of the potential to emit of all facilities un-der the PAL, with supporting documentation, and the greatest rolling12-month actual emission rate during the PAL effective period for fa-cilities that are not qualified;

(4) information as identified in §116.182(1) and (5) of thistitle (relating to Plant-wide Applicability Limit Permit Application);and

(5) any other information the owner or operator wishes theexecutive director to consider in determining the appropriate level forrenewing the PAL.

(d) The proposed PAL level and a written rationale for theproposed PAL level are subject to the public notice requirements in§116.194 of this title (relating to Public Notice and Comment). Duringsuch public review, any person may propose a PAL level for the sourcefor consideration by the executive director.



(e) The level of the renewed PAL must be established by set-ting the cap to equal the sum of the design emission rates from allqualified facilities, the greatest rolling 12-month actual emissions dur-ing the PAL effective period for facilities that are not qualified, and theapplicable federal de minimis level subject to the following limitations.

(1) If the potential to emit of the stationary source is lessthan the PAL, the PAL must be adjusted to a level no greater than thepotential to emit of the source.

(2) A renewed PAL must not be set at a level higher thanthe current PAL, unless the PAL is being amended concurrently withthe renewal.

(3) If the compliance date for a state or federal requirementthat applies to the PAL source occurs during the PAL effective period,the PAL cap contribution for the affected facility shall be adjusteddown accordingly.

§116.198. Expiration or Voidance.(a) A plant-wide applicability limit (PAL) permit holder may

request that the permit be voided at any time after initial issuance. Thatrequest must include documentation demonstrating that all requiredcontrol technology upgrades have been completed for that pollutant orpropose an alternate mechanism for making the upgrades enforceable.The PAL permit remains effective until voided by the executive direc-tor.

(b) If a PAL permit expires or is voided, each facility mustcomply with all allowable emission limitations associated with thestate new source review authorization. Any physical change or changein the method of operation at the major stationary source will be sub-ject to major new source review requirements if such change meets thedefinition of major modification. The owner or operator shall continueto comply with any state or federal applicable requirements that mayhave applied during the PAL permit effective period.



2005.


♦ ♦ ♦SUBCHAPTER E. HAZARDOUS AIRPOLLUTANTS: REGULATIONS GOVERNINGCONSTRUCTED OR RECONSTRUCTEDMAJOR SOURCES (FCAA, SECTION 112(G), 40CFR PART 63)30 TAC §§116.400, 116.402, 116.404, 116.406

STATUTORY AUTHORITY

The new sections are proposed under TWC, §5.103, concerningRules, and §5.105, concerning General Policy, which authorizethe commission to adopt rules necessary to carry out its powers

and duties under the TWC; and under THSC, §382.017, con-cerning Rules, which authorizes the commission to adopt rulesconsistent with the policy and purposes of the TCAA. The newsections are also proposed under THSC, §382.002, concerningPolicy and Purpose, which establishes the commission purposeto safeguard the state’s air resources, consistent with the pro-tection of public health, general welfare, and physical property;§382.011, concerning General Powers and Duties, which au-thorizes the commission to control the quality of the state’s air;§382.012, concerning State Air Control Plan, which authorizesthe commission to prepare and develop a general, comprehen-sive plan for the control of the state’s air; §382.051, concerningPermitting Authority of Commission; Rules, which authorizes thecommission to issue permits and adopt rules necessary for per-mits issued under THSC, Chapter 382; §382.0512, concerningModification of Existing Facility, which establishes a modificationand its limits; and §382.0518, concerning Preconstruction Per-mit, which requires that a permit be obtained from the commis-sion prior to new construction or modification of an existing facil-ity.

The proposed new sections implement THSC, §§382.002,382.011, 382.012, 382.051, and 382.0518.


(a) The provisions of this subchapter implement Federal CleanAir Act (FCAA), §112(g), Modifications, and 40 Code of FederalRegulations Part 63, Hazardous Air Pollutants: Regulations Govern-ing Constructed or Reconstructed Major Sources, Subpart B, Require-ments for Control Technology, as amended December 27, 1996. Af-fected sources (as defined in §116.15(1) of this title (relating to Sec-tion 112(g) Definitions)) subject to this subchapter are those sourcesfor which the United States Environmental Protection Agency has notpromulgated a maximum available control technology (MACT) stan-dard under 40 Code of Federal Regulations (CFR) Part 63. For pur-poses of this subchapter, the following terms apply.

(1) Construct a major source--As follows.

(A) To fabricate, erect, or install at any green field site astationary source or group of stationary sources that are located withina contiguous area and under common control and that emit or havethe potential to emit ten tons per year of any hazardous air pollutant(HAP) or 25 tons per year of any combination of HAPs;

(B) to fabricate, erect, or install at any developed sitea new process or production unit that in and of itself emits or has thepotential to emit ten tons per year of any HAP or 25 tons per yearof any combination of HAPs, unless the process or production unitsatisfies clauses (i) - (vi) of this subparagraph:

(i) all HAPs emitted by the process or productionunit that would otherwise be controlled under the requirements of thissubchapter will be controlled by emission control equipment that waspreviously installed at the same site as the process or production unit;

(ii) either of the following regarding control of HAPemissions:

(I) the executive director has determined withina period of five years prior to the fabrication, erection, or installationof the process or production unit that the existing emission controlequipment represented best available control technology (BACT), low-est achievable emission rate (LAER) under 40 CFR Part 51 or Part 52,toxics-best available control technology (T-BACT), or MACT basedon state air toxic rules for the category of pollutants that includes thoseHAPs to be emitted by the process or production unit; or



(II) the executive director determines that thecontrol of HAP emissions provided by the existing equipment will beequivalent to that level of control currently achieved by other similarsources using a level of control equivalent to current BACT, LAER,T-BACT, or state air toxic rule MACT determination;

(iii) the executive director determines that the per-cent control efficiency for emissions of HAP from all sources to becontrolled by the existing control equipment will be equivalent to thepercent control efficiency provided by the control equipment prior tothe inclusion of the new process or production unit;

(iv) the executive director has provided notice andan opportunity for public comment concerning the determination thatcriteria in clauses (i) - (iii) of this subparagraph apply and concerningthe continued adequacy of any prior LAER, BACT, T-BACT, or stateair toxic rule MACT determination;

(v) if any commenter has asserted that a priorLAER, BACT, T-BACT, or state air toxic rule MACT determinationis no longer adequate, the executive director has determined that thelevel of control required by that prior determination remains adequate;and

(vi) any emission limitations, work practice require-ments, or other terms and conditions upon which the determinations inclauses (i) - (v) of this subparagraph are predicated will be construedby the executive director as applicable requirements under FCAA,§504(a), and either have been incorporated into any existing permitissued under Chapter 122 of this title (relating to Federal OperatingPermits) for the affected source (as defined in §116.15(1) of this title(relating to Section 112(g) Definitions)) or will be incorporated intosuch permit upon issuance.

(2) Reconstruct a major source--The replacement of com-ponents at an existing process or production unit that in and of itselfemits or has the potential to emit ten tons per year of any HAP or 25tons per year of any combination of HAP, whenever:

(A) the fixed capital cost of the new components ex-ceeds 50% of the fixed capital cost that would be required to constructa comparable process or production unit; and

(B) it is technically and economically feasible for thereconstructed major source to meet the applicable MACT emissionlimitation for new sources established under this subchapter.

(b) The requirements of this subchapter apply to an owner oroperator of an affected source (as defined in §116.15(1) of this title)that constructs or reconstructs, unless the affected source in questionhas been specifically regulated or exempted from regulation under astandard issued under FCAA, §112(d), (h), or (j) and incorporated inanother subpart of 40 CFR Part 63, or the owner or operator of suchaffected source has received all necessary air quality permits for suchconstruction or reconstruction project.

(c) Affected sources (as defined in §116.15(1) of this title)subject to the requirements of this subchapter are not eligible to use astandard permit under Subchapter F of this chapter (relating to Stan-dard Permits) unless the terms and conditions of the specific standardpermit meet the requirements of this subchapter.

§116.402. Exclusions.

(a) The requirements of this subchapter do not apply to elec-tric utility steam generating units unless and until such time as theseunits are added to the source category list under Federal Clean Air Act,§112(c)(5).

(b) The requirements of this subchapter do not apply to sta-tionary sources that are within a source category that has been deletedfrom the source category list under Federal Clean Air Act, §112(c)(9).

(c) The requirements of this subchapter do not apply to re-search and development activities, as defined in 40 Code of FederalRegulations, §63.41.

(d) Nothing in this subchapter shall prevent a state or localagency from imposing more stringent requirements than those con-tained in this subchapter.

§116.404. Application.Consistent with the requirements of 40 Code of Federal Regulations§63.43 (concerning maximum achievable control technology determi-nations for constructed and reconstructed major sources), the owneror operator of a proposed affected source (as defined in §116.15(1) ofthis title (relating to Section 112(g) Definitions)) shall submit a permitapplication as described in §116.110 of this title (relating to Applica-bility).

§116.406. Public Notice Requirements.Proposed affected sources (as defined in §116.15(1) of this title (relat-ing to Section 112(g) Definitions)) shall comply with the public noticerequirements contained in Chapter 39 of this title (relating to PublicNotice).



2005.


♦ ♦ ♦SUBCHAPTER E. EMERGENCY ORDERS30 TAC §116.410

(Editor’s note: The text of the following section proposed for repealwill not be published. The section may be examined in the offices of theTexas Commission on Environmental Quality or in the Texas Registeroffice, Room 245, James Earl Rudder Building, 1019 Brazos Street,Austin.)

STATUTORY AUTHORITY

The repeal is proposed under TWC, §5.103, concerning Rules,and §5.105, concerning General Policy, which authorize thecommission to adopt rules necessary to carry out its powersand duties under the TWC; and under THSC, §382.017,concerning Rules, which authorizes the commission to adoptrules consistent with the policy and purposes of the TCAA. Therepeal is also proposed under THSC, §382.002, concerningPolicy and Purpose, which establishes the commission pur-pose to safeguard the state’s air resources, consistent withthe protection of public health, general welfare, and physicalproperty; §382.011, concerning General Powers and Duties,which authorizes the commission to control the quality of the



state’s air; and §382.012, concerning State Air Control Plan,which authorizes the commission to prepare and develop ageneral, comprehensive plan for the control of the state’s air.

The proposed repeal implements THSC, §§382.002, 382.011,and 382.012.

§116.410. Applicability.This agency hereby certifies that the proposal has been reviewedby legal counsel and found to be within the agency’s legal author-ity to adopt.


2005.


♦ ♦ ♦SUBCHAPTER F. STANDARD PERMITS30 TAC §116.610, §116.617

STATUTORY AUTHORITY

The amendment and new section are proposed under TWC,§5.103, concerning Rules, and §5.105, concerning General Pol-icy, which authorize the commission to adopt rules necessaryto carry out its powers and duties under the TWC; and underTHSC, §382.017, concerning Rules, which authorizes the com-mission to adopt rules consistent with the policy and purposes ofthe TCAA. The amendment and new section are also proposedunder THSC, §382.002, concerning Policy and Purpose, whichestablishes the commission purpose to safeguard the state’s airresources, consistent with the protection of public health, gen-eral welfare, and physical property; §382.011, concerning Gen-eral Powers and Duties, which authorizes the commission to con-trol the quality of the state’s air; §382.012, concerning State AirControl Plan, which authorizes the commission to prepare anddevelop a general, comprehensive plan for the control of thestate’s air; §382.051, concerning Permitting Authority of Com-mission; Rules, which authorizes the commission to issue per-mits and adopt rules necessary for permits issued under THSCand to issue a standard permit for similar facilities, Chapter 382;§382.0512, concerning Modification of Existing Facility, whichestablishes a modification and its limits; §382.0518, concerningPreconstruction Permit, which requires that a permit be obtainedfrom the commission prior to new construction or modification ofan existing facility; and §382.05195, concerning Standard Per-mit, which authorizes the commission to issue a standard permitfor new or existing similar facilities if the standard permit is en-forceable, and the commission can adequately monitor compli-ance with the terms of the standard permit; and FCAA, 42 USC,§§7401 et seq., that requires permits for construction and oper-ation of new or modified major stationary sources.

The proposed amendment and new section implement THSC,§§382.002, 382.011, 382.012, 382.051, 382.0512, 382.0518,and 382.05195; and FCAA, 42 USC, §§7401 et seq.

§116.610. Applicability.(a) Under the Texas Clean Air Act [TCAA], §382.051, a

project that [which] meets the requirements for a standard permit

listed in this subchapter or issued by the commission is hereby entitledto the standard permit, provided the following conditions listed in thissection are met. For the purposes of this subchapter, project meansthe construction or modification of a facility or a group of facilitiessubmitted under the same registration. [:]

(1) Any [any] project that [which] results in a net increasein emissions of air contaminants from the project other than carbondioxide, water, nitrogen, methane, ethane, hydrogen, oxygen, or thosefor which a national ambient air quality standard [National AmbientAir Quality Standard] has been established must meet the emission lim-itations of §106.261[(3) or (4) or §106.262(3)] of this title (relating toFacilities (Emission Limitations) [, and Facilities (Emission and Dis-tance Limitations))], unless otherwise specified by a particular standardpermit. [;]

(2) Construction [construction] or operation of the projectmust be commenced prior to the effective date of a revision to this sub-chapter under which the project would no longer meet the requirementsfor a standard permit. [;]

(3) The [the] proposed project must comply with the appli-cable provisions of the Federal Clean Air Act (FCAA) [FCAA], §111(concerning New Source Performance Standards) as listed under [Ti-tle] 40 Code of Federal Regulations (CFR) Part 60, promulgated by theEPA. [;]

(4) The [the] proposed project must comply with the ap-plicable provisions of FCAA, §112 (concerning Hazardous Air Pollu-tants) as listed under 40 CFR Part 61, promulgated by the United StatesEnvironmental Protection Agency (EPA). [EPA;]

(5) The [the] proposed project must comply with the ap-plicable maximum achievable control technology standards as listedunder 40 CFR Part 63, promulgated by the EPA under FCAA, §112or as listed under Chapter 113, Subchapter C of this title (relating toNational Emissions Standards for Hazardous Air Pollutants for SourceCategories (FCAA, §112, 40 CFR Part 63)). [; and]

(6) (No change.)

(b) Any project [, except those authorized under §116.617 ofthis title (relating to Standard Permits for Pollution Control Projects),]which constitutes a new major source[,] or major modification underthe new source review requirements of the FCAA, Part C (Preventionof Significant Deterioration Review) or Part D (Nonattainment Review)and regulations promulgated thereunder is subject to the requirementsof §116.110 of this title (relating to Applicability) rather than this sub-chapter.

(c) - (d) (No change.)


(a) Scope and applicability.

(1) This standard permit applies to pollution controlprojects undertaken voluntarily or as required by any governmentalstandard, that reduce or maintain currently authorized emission ratesfor facilities authorized by a permit, standard permit, or permit byrule.

(2) The project may include:

(A) the installation or replacement of emissions controlequipment;

(B) the implementation or change to control tech-niques; or

(C) the substitution of compounds used in manufactur-ing processes.



(3) This standard permit must not be used to authorize theinstallation of emission control equipment or the implementation of acontrol technique that:

(A) constitutes the complete replacement of an existingproduction facility or reconstruction of a production facility as definedin 40 Code of Federal Regulations (40 CFR) §60.15(b)(1) and (c); or

(B) the executive director determines there are healtheffects concerns or the potential to exceed a national ambient air qual-ity standard (NAAQS) criteria pollutant or contaminant that resultsfrom an increase in emissions of any air contaminant until those con-cerns are addressed by the registrant to the satisfaction of the executivedirector; or

(C) returns a facility or group of facilities to compliancewith an existing authorization or permit.

(4) Only new or modified pollution control projects mustmeet the conditions of this standard permit. All previous standard per-mit registrations under §116.617 of this title (relating to Standard Per-mits for Pollution Control Projects) that were authorized prior to theeffective date of this rule must include the increases and decreases inemissions resulting from those projects in any future netting calcula-tion and all other conditions must be met upon the ten-year anniversaryand renewal of the original registration, or until administratively incor-porated into the facilities’ permit, if applicable.

(b) General requirements.

(1) Any claim under this standard permit must comply withall applicable conditions of:

(A) §116.604(1) and (2) of this title (relating to Dura-tion and Renewal of Registrations to Use Standard Permits);

(B) §116.605(d)(1) and (2) of this title (relating to Stan-dard Permit Amendment and Revocation);

(C) §116.610 of this title (relating to Applicability);

(D) §116.611 of this title (relating to Registration toUse a Standard Permit);

(E) §116.614 of this title (relating to Standard PermitFees); and

(F) §115.615 of this title (relating to General Condi-tions).

(2) Construction or implementation of the pollution con-trol project must begin within 180 days of receiving written acceptanceof the registration from the executive director and must comply with§116.115(b)(2) of this title and §116.120 of this title (relating to Gen-eral and Special Conditions and Voiding of Permits). Any changes toallowable emission rates authorized by this section become effectivewhen the project is complete and operation or implementation begins.

(3) The emissions limitations of §116.610(a)(1) of this titledo not apply to this standard permit.

(4) Predictable maintenance, startup, and shutdown emis-sions directly associated with the pollution control projects must beincluded in the representations of the registration application.

(5) Any increases in actual or allowable emission rates orany increase in production capacity authorized by this section (includ-ing increases associated with recovering lost production capacity) mustoccur solely as a result of the project as represented in the registrationapplication. Any increases of production associated with a pollutioncontrol project must not be utilized until an additional authorization isobtained.

(c) Replacement projects.

(1) The replacement of emissions control equipment orcontrol technique under this standard permit is not limited to themethod of control currently in place, provided that the control ortechnique is at least as effective as the current authorized method andall other requirements of this standard permit are met.

(2) The maintenance, startup, and shutdown emissionsmay be increased above currently authorized levels if the increaseis necessary to implement the replacement project and maintenance,startup, and shutdown emissions were authorized for the existingcontrol equipment or technique.

(3) Equipment installed under this section is subject to allapplicable testing and recordkeeping requirements of the original con-trol authorization. Alternate, equivalent monitoring, or records maybe proposed by the applicant for review and approval of the executivedirector.

(d) Registration requirements.

(1) A registration application must be submitted in accor-dance with the following.

(A) If there are no increases in authorized emissionsof any air contaminant resulting from a replacement pollution controlproject, a registration must be submitted no later than 30 days afterconstruction or implementation begins and the registration must beaccompanied by a $900 fee.

(B) If a new control device or technique is authorizedor if there are increases in authorized emissions of any air contaminantresulting from the pollution control project, a registration must be sub-mitted no later than 30 days prior to construction or implementation.The registration must be accompanied by a $900 fee. Construction orimplementation may begin only after:

(i) no written response has been received from theexecutive director within 30 calendar days of receipt by the TexasCommission on Environmental Quality (TCEQ); or

(ii) written acceptance of the pollution controlproject has been issued by the executive director.

(C) If there are any changes in representations to a pre-viously authorized pollution control project standard permit for whichthere are no increases in authorized emissions of any air contaminant,a notification or letter must be submitted no later than 30 days afterconstruction or implementation of the change begins. No fee appliesand no response will be sent from the executive director.

(D) If there are any changes in representations to a pre-viously authorized pollution control project standard permit that alsoincrease authorized emissions of any air contaminant resulting fromthe pollution control project, a registration alteration must be submit-ted no later than 30 days prior to the start of construction or imple-mentation of the change. The registration must be accompanied by a$450 fee, unless received within 180 days of the original registrationapproval. Construction or implementation may begin only after:

(i) no written response has been received from theexecutive director within 30 calendar days of receipt by the TCEQ; or

(ii) written acceptance of the pollution controlproject has been issued by the executive director.

(2) The registration application must include the follow-ing:

(A) a description of process units affected by theproject;



(B) a description of the project;

(C) identification of existing permits or registrations af-fected by the project;

(D) quantification and basis of increases and/ordecreases associated with the project, including identification ofaffected existing or proposed emission points, all air contaminants,and hourly and annual emissions rates;

(E) a description of proposed monitoring and record-keeping that will demonstrate that the project decreases or maintainsemission rates as represented; and

(F) a description of how the standard permit will beadministratively incorporated into the existing permit(s).

(e) Operational requirements. Upon installation of the pollu-tion control project, the owner or operator shall comply with the re-quirements of paragraphs (1) and (2) of this subsection.

(1) General duty. The owner or operator must operate thepollution control project in a manner consistent with good industry andengineering practices and in such a way as to minimize emissions ofcollateral pollutants, within the physical configuration and operationalstandards usually associated with the emissions control device, strat-egy, or technique.

(2) Recordkeeping. The owner or operator must maintaincopies on site of monitoring or other emission records to prove that thepollution control project is operated consistent with the requirementsin paragraph (1) of this subsection, and the conditions of this standardpermit.

(f) Incorporation of the standard permit into the facility au-thorization.

(1) Any new facilities or changes in method of control ortechnique authorized by this standard permit at a previously permittedor standard permitted facility must be incorporated into that facility’spermit when the permit is amended or renewed. Incorporation duringamendments or renewal must meet the following:

(A) authorized changes will be subject to an impacts re-view based on the Effects Evaluation Flowchart and "Air Quality Mod-eling Guidelines" except for facilities permitted under another standardpermit;

(B) authorized changes will not be subject to best avail-able control technology review;

(C) this standard permit will be voided and the changesand emissions will become authorized by the permit or standard per-mit; and

(D) any emission increases authorized by this standardpermit will not be considered for purposes of triggering public noticefor amendments.

(2) All increases in previously authorized emissions, newfacilities, or changes in method of control or technique authorized bythis standard permit for facilities previously authorized by a permit byrule must comply with §106.4 of this title (relating to Requirementsfor Permitting by Rule), except §106.4(a)(1) of this title, and §106.8of this title (relating to Recordkeeping).



2005.


♦ ♦ ♦30 TAC §116.617

(Editor’s note: The text of the following section proposed for repealwill not be published. The section may be examined in the offices of theTexas Commission on Environmental Quality or in the Texas Registeroffice, Room 245, James Earl Rudder Building, 1019 Brazos Street,Austin.)

STATUTORY AUTHORITY

The repeal is proposed under TWC, §5.103, concerning Rules,and §5.105, concerning General Policy, which authorize thecommission to adopt rules necessary to carry out its powersand duties under the TWC; and under THSC, §382.017, con-cerning Rules, which authorizes the commission to adopt rulesconsistent with the policy and purposes of the TCAA. The repealis also proposed under THSC, §382.002, concerning Policy andPurpose, which establishes the commission purpose to safe-guard the state’s air resources, consistent with the protection ofpublic health, general welfare, and physical property; §382.011,concerning General Powers and Duties, which authorizes thecommission to control the quality of the state’s air; §382.012,concerning State Air Control Plan, which authorizes the com-mission to prepare and develop a general, comprehensive planfor the control of the state’s air; and §382.051, concerningPermitting Authority of Commission; Rules, which authorizesthe commission to issue permits and adopt rules necessary forpermits issued under THSC, Chapter 382.

The proposed repeal implements THSC, §§382.002, 382.011,382.012, and 382.051.

§116.617. Standard Permits for Pollution Control Projects.This agency hereby certifies that the proposal has been reviewedby legal counsel and found to be within the agency’s legal author-ity to adopt.


2005.


♦ ♦ ♦SUBCHAPTER K. EMERGENCY ORDERS30 TAC §116.1200

STATUTORY AUTHORITY

The new section is proposed under TWC, §5.103, concerningRules, and §5.105, concerning General Policy, which authorize



(20) offer of coverage for therapies for children with de-velopmental delays as required by Insurance Code Chapter 1367, Sub-chapter E;

(21) coverage of certain tests for detection of prostate can-cer as required by Insurance Code Chapter 1362;

(22) coverage of acquired brain injury treatment/servicesas required by Insurance Code Chapter 1352;

(23) coverage of certain tests for detection of colorectalcancer as required by Insurance Code Chapter 1363;

(24) coverage for reconstructive surgery for craniofacialabnormalities in a child as required by Insurance Code §§1367.151 -1367.154;

(25) coverage of rehabilitation therapies as required by In-surance Code §1271.156;

(26) limitations on the treatment of complications in preg-nancy established by §21.405 of this title (relating to Policy Terms andConditions);

(27) coverage for services related to immunizations andvaccinations under managed care plans as required by Insurance CodeChapter 1353;

(28) limitations or restrictions on copayments and de-ductibles imposed by §11.506(2)(A) and (B) of this title (relating toMandatory Contractual Provisions: Group, Individual and ConversionAgreement and Group Certi�cate);

(29) coverage of a minimum stay for maternity as requiredby Insurance Code §§1366.051 - 1366.059;

(30) coverage of reconstructive surgery incident to mastec-tomy as required by Insurance Code §§1357.001 - 1357.007; and

(31) coverage of a minimum stay for mastectomy treat-ment/services as required by Insurance Code §§1357.051 - 1357.057.

(b) A health bene�t plan issued by an HMO through a healthgroup cooperative must provide for the basic health care services asprovided in §11.508 or §11.509 of this title (relating to Mandatory Ben-e�t Standards: Group, Individual and Conversion Agreements and Ad-ditional Mandatory Bene�t Standards, Group Agreement Only):

(c) A health bene�t plan offered by an insurer through a healthgroup cooperative is not subject to §3.3704(a)(6) of this title (relatingto Freedom of Choice: Availability of Preferred Providers).

This agency hereby certi�es that the adoption has been reviewedby legal counsel and found to be a valid exercise of the agency’slegal authority.

Filed with the Of�ce of the Secretary of State on January 11,

2006.

TRD-200600176Gene C. JarmonGeneral Counsel and Chief ClerkTexas Department of InsuranceEffective date: January 31, 2006Proposal publication date: November 18, 2005For further information, please call: (512) 463-6327

28 TAC §26.412

The Commissioner of Insurance adopts the repeal of §26.412,concerning the refusal of a health carrier to renew employerhealth bene�t plans delivered or issued to a health group co-operative. The repeal of this section is adopted without changesto the proposal published in the November 18, 2005, issue of theTexas Register (30 TexReg 7690).

Section 26.412 regulated a health carrier’s election to refuse torenew employer health bene�t plans delivered or issued to ahealth group cooperative. Repeal of §26.412 is necessary be-cause the enactment of SB 805, 79th Legislature, Regular Ses-sion, obviates the need for the section. Under SB 805, healthcarriers issuing employer health bene�t plans to health groupcooperatives are to treat such cooperatives as either large em-ployers or small employers pursuant to the refusal-to-renew pro-visions of Insurance Code §1501.063.

The adoption of the repeal will result in consistency between theChapter 26 administrative rules regulating health care coopera-tives with regard to refusal-to-renew provisions and the amend-ments to Insurance Code Chapter 1501 enacted in SB 805.

The department did not receive any comments on the proposedrepeal.

The repeal is adopted pursuant to the Insurance Code§§1501.010, 1501.058, 1501.0581, and 36.001, and SEC-TION 7 of SB 805 as enacted by the 79th Legislature, RegularSession. Section 1501.010 authorizes the Commissioner ofInsurance to adopt rules as necessary to implement Chapter1501. Section 1501.058 requires compliance with federallaws applicable to cooperatives and health bene�t plans issuedthrough cooperatives, to the extent required by state law or rulesadopted by the Commissioner. Section 1501.0581 requires acarrier to make an informational �ling with the Commissionerconcerning intended offers of coverage to a cooperative andrequires that the Commissioner by rule prescribe the form andthe time of the �ling. SECTION 7 of SB 805 directs the Com-missioner, not later than January 1, 2006, to adopt rules under§1501.010 as necessary to implement the change in law madeby SB 805. Section 36.001 provides that the Commissionerof Insurance may adopt any rules necessary and appropriateto implement the powers and duties of the Texas Departmentof Insurance under the Insurance Code and other laws of thisstate.



2006.

TRD-200600175Gene C. JarmonGeneral Counsel and Chief ClerkTexas Department of InsuranceEffective date: January 31, 2006Proposal publication date: November 18, 2005For further information, please call: (512) 463-6327

TITLE 30. ENVIRONMENTAL QUALITY

ADOPTED RULES January 27, 2006 31 TexReg 515Add. 58


PART 1. TEXAS COMMISSION ONENVIRONMENTAL QUALITY

CHAPTER 116. CONTROL OF AIRPOLLUTION BY PERMITS FOR NEWCONSTRUCTION OR MODIFICATIONThe Texas Commission on Environmental Quality (TCEQor commission) adopts amendments to §§116.12, 116.150,116.151, 116.160, and 116.610; the repeal of §§116.180 -116.183, 116.410, and 116.617; and new §§116.121, 116.180,116.182, 116.184, 116.186, 116.188, 116.190, 116.192, 116.194,116.196, 116.198, 116.400, 116.402, 116.404, 116.406, 116.617,and 116.1200. Sections 116.12, 116.121, 116.150, 116.151,116.160, 116.180, 116.182, 116.186, 116.188, 116.190, 116.192,116.194, 116.196, 116.198, 116.400, 116.610, and 116.617 areadopted with changes to the proposed text as published in theSeptember 30, 2005, issue of the Texas Register (30 TexReg6183). Sections 116.184, 116.402, 116.404, 116.406, and116.1200 and the repealed §§116.180 - 116.183, 116.410, and116.617 are adopted without changes to the proposed text aspublished and the text will not be republished. The amended,repealed, and new sections will be submitted to the UnitedStates Environmental Protection Agency (EPA) as revisions tothe state implementation plan (SIP).

BACKGROUND AND SUMMARY OF THE FACTUAL BASISFOR THE ADOPTED RULES

EPA adopted revisions to 40 Code of Federal Regulations (CFR)§§52.21, 51.165, and 51.166 in the December 31, 2002, publi-cation of the Federal Register (67 FR 251), which amended theapplication of federal new source review (NSR) in air quality per-mitting. Federal NSR is triggered by a new major source or ma-jor modi�cation. If the area in which the source will be located isalso classi�ed as nonattainment for a pollutant that will be emit-ted by the source, the source must offset the emission increasewith emission decreases at other facilities or through the pur-chase and retirement of emission reduction credits. The sourcewould also have to apply control technology that meets the low-est achievable emission rate to the new and modi�ed units.

Federal NSR reform is intended to limit the instances where fed-eral NSR will be required of facilities that undergo modi�cations.It will streamline plant modi�cations by allowing small changesto be completed without the delay associated with federal NSR.Currently, most modi�cations are evaluated to determine the ap-plicability of federal NSR through a netting exercise. Netting is anaccounting exercise where, prior to the modi�cation of a facility,the sum of emission increases and decreases over a speci�edperiod of time at the plant site is determined. If the total exceedsthe major modi�cation threshold, the modi�cation is subject tofederal NSR. NSR reform provides an additional path that maybe taken to avoid federal NSR applicability (plant-wide applica-bility limit (PAL)) as well as methods to minimize the emissionincrease determined in the netting exercise (baseline and ac-tual-to-projected actual emission rates).

The commission’s proposal on NSR reform was intended to inte-grate the federal revisions within an existing state program thataddressed similar situations concerning plant-wide emission lim-its and baseline emission determinations. The commission alsosolicited comments from affected industries on the relative ben-e�ts of an integrated program versus an incorporation of the fed-eral program without substantive changes. It is clear from stake-

holder meetings and public comment that a program matchingthe federal rules is the preferred method of accomplishing fed-eral NSR reform. The commission agrees that it has tradition-ally approached state NSR permitting separately from federalNSR requirements. Additionally, the commission can continuethis approach under federal NSR reform without endangering theattainment of maintenance of national ambient air quality stan-dards (NAAQS) or affecting public health. The commission isadopting rules implementing the federal program on PALs, ac-tual-to-projected actual emissions test, and baseline determina-tion without substantive changes to the federal model for theseprograms.

The commission currently allows the inclusion of certain main-tenance, startup, and shutdown (MSS) emissions in NSRpermits. The commission expects to consider rules to prescribeauthorization mechanisms and procedures for emissions nothistorically authorized, including those for MSS activities. Thecommission will also consider the authorization of emissionsthat any well maintained, operated, and managed facility cannoteliminate entirely. These emissions are therefore anticipatedand quanti�able, yet unscheduled (QUAN). Examples areemissions that may be released intermittently from a pressurerelief valve, line switching, compressor blow-downs, or evena burst seal well before the end of its life expectancy. QUANemissions are arguably different in nature from the most com-monly reported emissions events, those incidents resultingfrom inadequate maintenance, malfunctions, accidents, anddisasters, and therefore should be taken out of the classi�cationof "emission event" by providing an authorization mechanism.These actions will enable the commission to authorize MSS andQUAN emissions for inclusion in baseline emissions applicableto the NSR reform program.

The commission is also adopting a new version of the state pol-lution control project standard permit that includes required fed-eral changes emissions netting. The new standard permit alsoincludes authorization requirements for MSS and is reorganized.

Plant-wide Applicability Limit

The adopted version of the site-wide PAL closely follows the fed-eral model and is established for each pollutant using the base-line emission rate for each facility. A control technology evalua-tion is required only if a cap increase is sought. The PAL can bereduced at renewal if emissions are less than 80% of the cap.The PAL baseline emissions will include authorized MSS andQUAN.

Baseline

The emission increase associated with a modi�cation is deter-mined by taking the difference, in tons per year, between the pro-posed emission rate and the actual annual emissions (or base-line emissions) during the baseline period. The baseline pe-riod can be any consecutive 24-month period in the previousten years (typically that period where the emissions from the fa-cility to be modi�ed are the greatest). The baseline period isa 24-month period in the previous �ve years for electric utilitysteam generating units.

Actual-to-Projected Actual Emissions Test

Federal NSR reform allows use of a projected actual emissionrate to be used to determine a project emission increase withcompliance tracked for �ve to ten years. Additionally, any calcu-lated emission increase can be reduced by the emissions thatcould have been accommodated in the baseline period.

31 TexReg 516 January 27, 2006 Texas RegisterAdd. 59


Federal NSR reform included two other components, the cleanunit designations and pollution control projects. As a result of apetition for review of EPA’s �nal action, on June 24, 2005, theDistrict of Columbia Circuit Court of Appeals in State of NewYork, et al v. U.S. Environmental Protection Agency, No. 413F.3d 3 (D.C. Cir 2005), vacated the clean unit and pollution con-trol project provisions of the rule and remanded recordkeepingprovisions to the EPA. As a result of this court decision, the com-mission has not adopted rules concerning clean unit and fed-eral pollution control projects. The commission is adopting thestandard permit for state pollution control projects. The standardpermit for state pollution control projects allows projects that willhave better or equivalent controls, but increases and decreasesfor projects qualifying for the standard permit for state pollutioncontrol projects requires evaluation for federal permitting appli-cability, which may include netting calculations. This new re-quirement for the state pollution control projects is also a resultof the June 24, 2005, ruling, which does not allow a federal NSRexemption for incidental emission increases resulting from pol-lution control projects. In addition, the standard permit for statepollution control projects may be used to authorize emissionsreductions and collateral increases for facilities authorized un-der a permit by rule as long as any collateral increases do notcause emission rates to exceed limits found in 30 TAC §106.4(a),Requirements for Permitting by Rule, or other standard permitsas long as any collateral increases do not exceed the limits of§116.610, Applicability.

SECTION BY SECTION DISCUSSION

The commission adopted administrative changes throughout thisrulemaking to be consistent with guidance provided in the TexasLegislative Council Drafting Manual, November 2004, and toconform with Texas Register requirements and agency guide-lines.

§116.12. Federal Permit De�nitions.

The commission amended the title of §116.12 to re�ect the ad-dition of all de�nitions associated with federal NSR or preven-tion of signi�cant deterioration (PSD) permit applicability analy-sis. In addition to the changes necessary to incorporate NSRreform into the nonattainment permit program, the commissionhas adopted changes associated with including PSD applicabil-ity analysis. These de�nitions now apply to the revised sectionsof the PSD rules in Chapter 116, Subchapter B, Division 6, Pre-vention of Signi�cant Deterioration Review, as well as the newsections associated with PAL permits.

The de�nition of actual emissions, in paragraph (1), has beenamended to exclude this de�nition from being used in the fed-eral NSR applicability test. In response to public comments,the commission speci�ed that actual emissions are determinedover a 24-month period instead of two years. When determiningwhether the emission increase associated with a project is signif-icant, the baseline actual emissions, de�ned in new paragraph(3), must be used. Paragraph (3)(A) allows electric utility steamgenerating units to identify baseline actual emissions as the rate,in tons per year, at which an existing unit emitted the pollutantduring any consecutive 24-month period within the �ve-year pe-riod immediately preceding construction. A different time periodmay be selected if it is shown to be more representative of nor-mal source operations. This is consistent with past guidanceprovided by EPA for these sources. In response to public com-ment, the commission deleted the word "average" as a modi�erfor "emissions" and changed "reviewing authority" references to"executive director." The commission made this change to refer

to "executive director" through the de�nitions added to §116.12for the implementation of NSR reform.

Paragraph (3)(B) allows other source types to choose 24 con-secutive months in the ten years preceding start of constructionto establish their baseline emissions. In this case, the sourcemust adjust this emission rate down for any emission limitationsthat would currently apply to the facility. These limitations includerequirements in the SIP, federal rules (with the exception of 40CFR Part 63), or permit requirements that would apply when theanalysis is completed.

Paragraph (3)(C) identi�es baseline emissions for new facilitiesas being zero and also de�nes baseline emissions for new facili-ties that have operated for less than two years to be the facility’spotential to emit. Paragraph (3)(D) requires that a project affect-ing all facilities use the same 24-month baseline period for eachpollutant. For example, if a project affected �ve facilities thatemitted volatile organic compounds and particulate matter, all�ve would have to identify the same baseline period for volatileorganic compounds; however, a different 24-month period couldbe chosen for particulate matter. The source must have suf�-cient records to document the baseline emissions, which cannothave occurred before November 15, 1990.

Paragraph (3)(D) also requires that baseline emission rates beadjusted down to exclude noncompliant emissions. The EPA’sreform rule requires that baseline emissions include startup,shutdown, and malfunction emissions. The commission’s policy,which has evolved over a number of years, currently allows forpermitting of emissions from certain MSS activities. Changesto this policy are being evaluated. The commission has beenunsuccessful in getting clari�cation on the EPA’s basis for inclu-sion of malfunction emissions in the baseline calculation. Giventhese circumstances, paragraph (3)(E) has been added to allowfor the inclusion of those emissions that could currently be au-thorized to be included in the baseline. The commission deletedthe phrase "in a permit action under Chapter 106 of this title(relating to Permits by Rule) and this chapter" because theseare types of authorizations and the phrase is redundant. Giventhat sources would become aware of this change with adoptionof this rule amendment, the effort involved in authorizing thesetypes of emissions, and the baseline period having to be withinten years of the project, this method of determining baselineemissions would be available for some time but not beyondten years from the effective date of this rule amendment. Afterthat date, all baseline emissions will have to have been autho-rized. Paragraph (3)(D) also requires that fugitive emissions beincluded in the baseline to the extent they can be quanti�ed.

In response to public comment to adopt a version of NSR re-form closer to the federal model and to be consistent with theuse of federal terms, the commission had added de�nitions for"Basic design parameters," "Major facility," "Replacement facil-ity," "Signi�cant facility," and "Small facility." The term "facility"has been substituted for the federal term "emissions unit" in theappropriate de�nitions. The term "facility" is an established partof the commission’s permitting program and is synonymous with"emissions unit." The remaining paragraphs have been renum-bered as a result of the added de�nitions.

Paragraphs (7) and (8), associated with the federal de�nition ofclean coal, have been added as a result of including PSD appli-cability into the de�nitions under this section. The de�nition ofde minimis threshold test in paragraph (12) has been revised toreference signi�cant levels, including those for PSD as well asnonattainment. In response to public comment, the commission



substituted the term "signi�cant level" for "major modi�cation" inTable 1 in the de�nition of "Major modi�cation" in §116.12.

The federal de�nition of electric utility steam generating unit isprovided in new paragraph (13). The de�nition identi�es thoseunits that are subject to a different baseline emissions determi-nation than other source types. New paragraph (14) de�nes fed-erally regulated NSR pollutant, providing a comprehensive list ofpollutants that may be subject to federal NSR.

The de�nition for major stationary source has been renumberedas paragraph (17) and has been modi�ed to remove referencesto facility for clarity, as well as to include PSD review within thede�nition. 40 CFR §51.166(b)(1) is referenced to identify thePSD major source thresholds. The "source" identi�ed in this def-inition is the EPA NSR source that is, in most cases, analogousto "account" as de�ned in 30 TAC §101.1, General Air QualityDe�nitions.

A number of changes are adopted for the de�nition of major mod-i�cation in renumbered paragraph (18). The commission addedlanguage to incorporate PSD review into the de�nition and ref-erences to facility have been removed for clarity. Language hasbeen added to clearly identify the two criteria, a signi�cant projectemission increase and a signi�cant net emission increase, thatmust be met for a modi�cation to be considered major at a majorsource. In response to public comment concerning the adoptionof a PAL program closer to the federal model, the commissionsubstituted the term "signi�cant level" for "major modi�cation" inTable 1, and deleted the proposed expansion of the de�nition toidentify projects performed at facilities within a PAL as being ma-jor modi�cations if the modi�cations result in emission increasesat facilities outside the PAL that are signi�cant.

The commission adopted changes to the de�nition of netemission increase in renumbered paragraph (20) specifyingthat baseline actual emissions are to be used to determineemission increases and decreases, adjusting the language toaccommodate for PSD applicability, and excluding emissionincreases at facilities under a PAL from being creditable. Underthe amendment, emission decreases cannot be counted inboth an attainment demonstration and credit for nonattainmentnetting because this would be double credit for the same reduc-tion. Emission decreases need only be enforceable rather thanfederally enforceable. The commission deleted the phrase "en-forceable as a practical matter" and will just use "enforceable."The commission also substituted the term "project emissionsincrease" for "total increase in actual emissions from a particularphysical change. . ." because this concept is included within thede�nition of "Project emissions increase." In response to publiccomment the commission deleted the proposed revision thatstated that emission decrease cannot have been relied upon inthe issuance of a PAL. The commission made the same deletionin the de�nition of "Offset ratio" in paragraph (21).

The commission adopted new paragraphs (22) - (26) to incorpo-rate de�nitions from NSR reform related to PALs into the com-mission rules. These new paragraphs include de�nitions for:PAL; PAL effective date; PAL major modi�cation; PAL permit;and PAL pollutant. In response to public comment, the commis-sion modi�ed the proposed de�nition of PAL pollutant to restrictits application to major sources. The commission deleted thephrase "enforceable as a practical matter" and will just use "en-forceable."

The requirement to use baseline actual emissions has beenadded to renumbered paragraph (28), in the de�nition of "Project

net." The commission also substituted the term "project emis-sions increase" for "total increase in actual emissions from aparticular physical change. . ." because this concept is includedwithin the de�nition of "Project emissions increase."

The commission adopted new paragraphs (29) and (30) to de-�ne the new concepts of projected actual emissions and projectsemissions increase. The project emissions increase may be de-termined in a different manner than the other emission increasesthat might be part of a netting exercise (used to determine thenet emissions increase). For existing facilities, the emission in-crease at modi�ed or affected facilities may be determined byusing the projected actual emissions rate rather than the poten-tial to emit for the facility. The projected emission rate must bedeveloped using all relevant information including company pro-jections and �lings with regulatory authorities. The basis for theprojection must be maintained by the source and would be sub-mitted with any documentation required for a state NSR autho-rization to demonstrate that the project is not subject to federalreview. The source would be required to demonstrate compli-ance with the projected emission rates for ten years if there wasa change to the source’s potential to emit or increase in capacity.Other affected facilities would be required to demonstrate com-pliance with projected rates for �ve years.

The actual-to-projected actual emissions rate test also allowsthe source to remove from the project increase any emissionsincrease that could have been accommodated in the baselineperiod. These must be unrelated to the project and may includedemand growth. This federal rule change extends this conceptthat was developed for the electrical generation industry wheretraditionally there had been a captured, or limited, customer basethat was expected to grow at some rate unrelated to the availablecapacity of the generator. While this concept appears reason-able for the electric power industry as well as some sources witha limited customer base due to geography (such as gasoline ter-minals), it is not as useful for industries that have national or in-ternational markets served by multiple sources. In these cases,a demonstration is required that the market conditions expectedin the future would be signi�cantly different than any time in thepast ten years and that if they had occurred in the baseline, theywould have resulted in different operations. It is likely that thiscase would only be made in cases such as a prolonged outageat a major producer or a signi�cant shift in market conditions.The determination of what could have been accommodated islimited to what could have been produced or handled and doesnot allow for changes in emissions that could have occurred dueto a lower emission control device ef�ciency or the use of a fuelor solvent that might have resulted in greater emissions.

The commission adopted a de�nition for "Temporary clean coaltechnology demonstration project" as new paragraph (36) to fullyincorporate all of EPA’s exclusions to what is considered a majormodi�cation under NSR reform.

§116.121. Actual-to-Projected Actual and Emissions ExclusionTest for Emissions Increases.

The commission adopts this new section to require documen-tation associated with the projected actual emissions rates andrecords of compliance as identi�ed in the federal rule. New sub-section (a) requires a demonstration that federal NSR does notapply be submitted with any permit application or registration.This demonstration must be documented by records that includea project description, the facilities affected, and a description ofthe applicability test. New subsection (b) requires monitoring ofemissions that could increase as a result of the project if pro-



jected actual emissions are used to determine the project emis-sion increase at a facility.

New subsection (c) requires electric utility steam generatingunits to provide the executive director documentation of emis-sions for each calendar year that records are required underthe actual-to-projected actual test. New subsection (d) requiresfacilities, other than electric generating units, to submit a re-port to the executive director if annual emissions exceed thebaseline actual emissions by a signi�cant amount. Any otherinformation that the owner or operator wishes to include in thereport, such as an explanation as to why the emissions differfrom the preconstruction projection, may be included as well.New subsection (e) establishes record retention periods andwas modi�ed in response to public comment to allow reviewby local pollution control programs and the general public of alldocumentation required under this section.

The commission expects that projected actual emissions willbe used extensively in registrations or claims for non-PSD andnonattainment NSR authorizations where a maximum allow-able emission rate is not speci�ed in the rule. The use of aprojected actual emissions rate for a modi�ed source in theseNSR construction permits is expected to be limited because theallowable emission rate would not generally be based on anactivity level that would not be reached for more than ten years.The commission is adopting changes in subsections (a), (c),(d), and (e) to make language more concise and to specify theuse of a calendar year for the submission of reports.

§116.150. New Major Source of Major Modi�cation in OzoneNonattainment Areas.

The commission deleted the date (June 15, 2004) in subsection(a), which would apply major modi�cation determination basedon the date an application is determined administratively com-plete. In response to EPA comment, this determination will bemade based on the issuance date of the permit. The commis-sion is adopting subsection (a)(1) and (2) that speci�es when therequirements of this section will apply to facilities. The sectionwill apply on the effective date of the permit for facilities locatedin areas that are designated ozone nonattainment on the effec-tive date of this section. For those areas that are designatednonattainment after this section is effective, the section will applybased on the date a permit application is administratively com-plete.

The amendment to subsection (b) deleted language referring to amodi�ed facility that will be a new major stationary source, whichhas caused confusion about what constitutes a major modi�ca-tion at an emission source that becomes major after the modi-�cation. A minor modi�cation to a minor source that results ina major source does not qualify the modi�cation as major. Thecommission refers to the de�nitions of major stationary sourceand major modi�cation in §116.12 to make this determination.The commission also substituted the term "facility" for "emis-sion unit" in subsection (e)(1) for consistency in use of terms.The amendment to this section added a reference to "signi�cantlevel" consistent with changes in §116.12 and updated that sec-tion’s title to Nonattainment and Prevention of Signi�cant De-terioration Review De�nitions. In response to public comment,the commission also amended subsections (c)(3) and (d)(2) toindicate that project emission increases must be less than thesigni�cant level before and after netting.

In response to public comment, the commission deleted thephrase "aggregated over the contemporaneous period" from

subsection (e). This term "contemporaneous period" is includedin the de�nition of "De minimis threshold test (netting)" and wasredundant.

§116.151. New Major Source or Major Modi�cation in Nonattain-ment Area Other Than Ozone.

The commission adopted amendments to this section consistingprimarily of administrative and formatting changes. The refer-ence to November 15, 1992, has been deleted from subsection(a) because that date is not applicable for application of the sec-tion. The commission substituted the term "facility" for "emissionunit" in subsection (c)(1) for consistency in use of terms. Subsec-tions (b) and (c) state when netting is required, and subsection(c) was amended to delete the reference to "contemporaneousperiod" because this term is included in the de�nition of "De min-imis threshold test (netting)."

§116.160. Prevention of Signi�cant Deterioration Requirements.

The amendment to this section limits the incorporation by refer-ence of de�nitions from 40 CFR §52.21 that are used to admin-ister the PSD program, deleting most of the language in subsec-tion (a) and all of the language in existing subsections (b) - (d).

and all of the language in existing subsections (b) - (d).

Amended subsection (a) deleted the federal rule references andreplaced them with language that requires a proposed new majorsource or major modi�cation in an attainment or unclassi�ablearea to meet the requirements of this section.

The new subsection (b) states that the de minimis threshold test(netting) is required for all modi�cations to existing major sourcesof federally regulated NSR pollutants, unless the proposed emis-sions increases associated with a project, without regard to de-creases, are less than major modi�cation thresholds for the pol-lutant.

New subsection (c) incorporated by reference the followingde�nitions and requirements located in 40 CFR §52.21: base-line concentrations, baseline dates, baseline areas, innovativecontrol technology, federal land manager, terrain, Indian reser-vations/governing bodies, increments, ambient air ceilings,restrictions on area classi�cations, exclusions from incrementconsumption, redesignation, stack heights, exemptions, sourceimpact analysis, air quality analysis, source information, ad-ditional impact analysis, sources impacting federal Class Iareas, and innovative technology. Other de�nitions used forthe PSD program or visibility in Class I areas program arecurrently in the commission’s rules. The term "aggregated overthe contemporaneous period" was deleted from subsection(c) because the term is included within the term "De minimisthreshold test (netting)." The amendment also substituted theterm "facility" for "emissions unit" in the de�nitions incorporatedfrom the CFR because the commission’s permitting actions arebased on the individual facility or groups of facilities as de�nedin the commission’s rules. The term "executive director" alsoreplaces "administrator" in portions of 40 CFR §52.21(g) and(v). In response to public comment, the requirement to issue aPSD permit within a year of receipt of a completed applicationhas been deleted from subsection (c)(4).

Existing subsection (d) has been re-designated as subsection(e).

In addition to renaming Subchapter C, the commission alsoadopted a new Division 1, Plant-wide Applicability Limits.




This adopted section limits a PAL to one pollutant as requiredby the EPA and a site to one PAL permit in subsection (a). Thecommission is deleting the reference to state or federal permitand will use the term "NSR permit." A PAL permit may containseparate PALs for several pollutants and will likely be consol-idated with an NSR construction or �exible permit at the site.Subsections (b) and (c) identify the administrative procedure forchanges in ownership, as well as responsibility for the PAL per-mit application. The commission is changing the phrase "newowners of facilities, group of facilities, or account" to "new ownerof a major stationary source" as a more inclusive term.

§116.182. Plant-wide Applicability Limit Permit Application.

This new section identi�es the information necessary for aPAL permit application. Paragraph (1) requires the facilitiesthat would be included in the PAL to be identi�ed with theirdesign capacities and potential to emit and NSR authorizations.Paragraph (2) requires that the baseline emissions for thosefacilities be identi�ed so that they may be used to set the PAL.Paragraphs (3) and (5) require the applicant to identify howplans to monitor and use that information will be used to demon-strate compliance with the PAL. This information will serve as astarting point to develop PAL permit conditions.

The commission did not adopt the proposed new paragraphs (4)and (6) requiring that best available control technology (BACT),on average, be implemented on all existing facilities to be in-cluded in the PAL over a period of time (typically less than �veyears). This is consistent with the commission’s decision to im-plement NSR reform in a form closer to the federal model. Para-graph (6) would have required an implementation schedule forBACT if control technology required upgrading.


This new section requires that PAL applications be reviewed on aschedule similar to other air permits as provided for in §116.114,Application Review Schedule.


This new section identi�es the PAL as an annual emission ratefor a federally regulated NSR pollutant covering all facilities iden-ti�ed in the application in subsection (a). Emissions from all fa-cilities must be determined and compliance with the PAL mustbe documented monthly. The commission is deleting the unnec-essary phrase "enforceable as a practical matter" and will justuse "enforceable." The commission is also substituting the word"demonstrate" for "show."

Subsection (b) identi�es the general conditions applicable to ev-ery PAL. Paragraph (1) emphasizes that the PAL is not an autho-rization to construct but only sets an emission rate, below whichfederal NSR is not required. Paragraphs (2) and (3) identify sam-pling procedures and how a permit holder might obtain approvalfor an equivalent method. These requirements ensure consis-tency between various types of the commission’s air permits.The commission has substituted the word "are" for "will be" tomore accurately indicate the applicability of the section.

Subsection (b)(4) integrates common recordkeeping and report-ing requirements for most other air permits with the much moreextensive requirements identi�ed in the EPA rule. Paragraph(4)(A) and (B) require that the PAL permit application and recordsassociated with demonstrating cap compliance be maintainedon site. Subsection (b)(4) includes the reporting requirementsfrom the EPA rule. Consistent with its decision to adopt a PALprogram equivalent with the federal model, the commission de-

termined that the semiannual and deviation reporting require-ments proposed in subsection (b)(4) were not suf�ciently con-sistent with the federal rule requirements and added subsection(b)(4)(C) and (D) to incorporate federal requirements. Proposedsubsection (b)(5) was not adopted for consistency with the fed-eral rules.

Renumbered paragraphs (5) and (6) contain language commonto air permits identifying what facilities are covered by the PAL,and requiring proper operation of control equipment and com-pliance with all rules. The PAL life of ten years is identi�ed inparagraph (7). Paragraphs (8) and (9) incorporate requirementsfrom the EPA rule requiring facility emissions to be reported asthe potential to emit if monitoring data is not available, and thatall data used to establish the PAL be revalidated at least every�ve years. The commission also added subsection (b)(10) al-lowing the extension of a PAL while an application for renewal isbeing considered.

Subsection (c) identi�es those EPA requirements that mustbe incorporated into the permit through special conditions. Allfacilities in a PAL must be monitored using one of the followingfour methods: mass balance; continuous emission monitoringsystem, continuous parameter monitoring system, or predictiveemission monitoring system; or emission factors. An alternateapproach may be approved by the executive director. Perfor-mance standards for each type of monitoring are speci�ed.The special conditions will also require a BACT implementationschedule, if applicable. For consistency with the federal rule,the commission deleted subsection (c)(4), which had requiredan implementation schedule for BACT.


This new section identi�es how the PAL is to be determined. Thecommission is substituting "is " for "will be established as" in theopening paragraph to more clearly de�ne a PAL. In response topublic comment, the commission added a speci�cation requiringreduction of the PAL baseline emissions resulting from perma-nent shutdown of facilities. Paragraph (1) allows the inclusionof emissions, up to the signi�cance level, in addition to baselineemissions. For consistency with the federal rule, the commissiondid not adopt the provision requiring addition of the signi�cancelevel to project emission increases. Paragraph (2) limits all fa-cilities to the same baseline period for a given pollutant. Forconsistency with the federal rule, proposed paragraph (3) thataddressed determination of the PAL if there is a major modi�-cation involved was not adopted. Paragraph (4), renumbered asparagraph (3), requires that the PAL be reduced for any effectiverules that have a future compliance date.

§116.190. Federal Nonattainment and Prevention of Signi�cantDeterioration Review.

This new section identi�es that any changes that occur under aPAL are not considered federal modi�cations unless the PAL willbe exceeded. Subsection (b) restricts the generation of offsetsfrom facilities under a PAL to cases where the PAL is loweredand such a decrease would be creditable without the PAL. Forconsistency with the federal rule, the commission added subsec-tion (c), which states that a physical or operational change notcausing an exceedence of a PAL is not subject to federal NSRreview.


Consistent with its decision to adopt a PAL equivalent to thefederal model, the commission made extensive revisions to



§116.192, which include the requirements for reopening a PALpermit and increasing a PAL.

The commission retained the requirement that would allow in-creases to a PAL only through amendment in subsection (a). Thecommission deleted the requirement that the new or modi�ed fa-cilities causing the need for the PAL increase be reviewed underthe appropriate federal NSR program. The amended PAL re-mains subject to public notice, and the PAL increases are effec-tive when the new and modi�ed units become operational. Thecommission added subsection (a)(1), which would require theconsidered application of BACT or equivalent technology wherea facility proposes to add or modify units in such a way as toequal or cause an exceedance of the PAL. Such an increasewould be authorized only if the source would not be able to main-tain emissions below the PAL assuming application of BACT orBACT-equivalent controls. The commission added subsection(a)(2), which requires federal NSR permits for all facilities thatequal or exceed a PAL. The new PAL would be the sum of theallowable emissions for each new or modi�ed source after theapplication of BACT. Subsection (a)(3) requires any new PAL tobe effective on the day any new unit that is part of the PAL be-gins operation. Subsection (a)(4) states that the PAL shall be thesum of the allowable emissions for each modi�ed or new facility,plus the sum of the baseline actual emissions of the signi�cantand major emissions units after the application of BACT-equiva-lent controls as identi�ed in subsection (a)(1) of this section, plusthe sum of the baseline actual emissions of the small emissionsunits.

The commission did not adopt proposed subsection (b), whichlimited reconsideration of controls associated with a PAL toamendments, but allows for changes in the implementationschedule to be requested through alteration. The commissionadopted a new subsection (b), which identi�es other changesthat may be completed by alteration. These include changes tothe special conditions that do not increase the emission cap.


The commission adopted a revised version of this section to re-quire noti�cation of intent to issue a permit allowing for publiccomment and an executive director response. These public no-tice requirements are similar to what the commission currentlyuses for permitting grandfathered facilities, and the commissionhas determined that they are equivalent to federal notice require-ments for PALs. The public notice requirements for the issuanceof a PAL permit does not exempt applicants for an NSR permitfrom meeting the requirements of Chapter 116, Subchapter B.


This new section requires that a PAL renewal application be sub-mitted within six to 18 months of the PAL expiration date in sub-section (a). Submittal within that time period ensures that thePAL will not expire. Subsection (b) makes all PALs issued with�exible permits under past guidance subject to renewal underthis proposed rule. Any PAL that has been in place for morethan ten years must be submitted for renewal by December 31,2006, or within the time speci�ed, whichever is later.

Subsection (c) identi�es the information necessary for a renewalapplication. This information includes the proposed PAL leveland any other information that the executive director may requireto determine at what level to renew the PAL. For consistency withthe federal rule, the commission did not adopt provisions thatwould have required identi�cation of and justi�cation for thosequali�ed facilities to be included in the PAL and the potential

to emit for quali�ed facilities and highest consecutive 12-monthemissions in the last ten years for those that are not quali�ed.

Subsection (d) would require public notice for the renewed PAL.For consistency with the federal rule, the commission did notadopt the proposed language of subsection (e) that would haverequired the summation of the potential to emit for quali�ed fa-cilities and the greatest rolling 12-month emissions for the fa-cilities that are not quali�ed. The commission adopted revisedlanguage in subsection (e) allowing adjustment to a PAL if emis-sion levels are greater than or equal to 80% of the PAL and if theexecutive director determines that a new PAL is more represen-tative considering technology, economic factors, or the facility’sprior voluntary reductions.

To be consistent with the federal rule, the commission adopteda new subsection (f) allowing for adjustment of a PAL affectedby new state or federal requirements during the PAL effectiveperiod at the time of PAL or federal operating permit renewal,whichever occurs �rst.

§116.198. Expiration or Voidance.

To be consistent with the federal rule, the commission adoptedlanguage in this section signi�cantly different than language thatwas proposed. The commission did not adopt the requirementfor technology upgrades prior to PAL expiration or voidance. Theadopted language in subsection (a) speci�es the ten-year termof PAL permits. Subsection (b) addresses PALs that will not berenewed and allows owners of PAL sites to propose allowableemissions for each facility that was covered under the PAL. Theexecutive director will decide on the allowable emissions distri-bution and issue revised permits.

§116.400. Applicability; §116.402. Exclusions; §116.404. Appli-cation; and §116.406. Public Notice Requirements.

These new sections contain identical language to that found inthe current §§116.180 - 116.183. These sections apply to theregulation of sources of hazardous air pollutants. The new sec-tions are adopted as a reorganization of this chapter in order toaccommodate new sections concerning NSR reform and do notcontain any substantive changes. The commission adopted ad-ministrative changes to be consistent with previously mentionedguidelines and to remove dates that are no longer applicable.

The commission adopts the repeal of §116.410, Applicability.


The adopted amendment to this section removes references insubsection (a)(1) to speci�c paragraphs within 30 TAC §106.261because the paragraph numbering of §106.261 has changed.The reference to §106.262 is deleted because §106.261 refersto the use of §106.262, when applicable. The adopted changeto subsection (b) deletes the exemption from NSR requirementsfor projects authorized under proposed new §116.617. As dis-cussed earlier, this change is based on the June 24, 2005, de-cision that vacated EPA rules exempting incidental emission in-creases from NSR. In response to public comment, the com-mission adopted language referring to §116.12 for de�nitions of"major stationary source" and "major modi�cation."

The commission adopted the repeal of §116.617, Standard Per-mits for Pollution Control Projects.


This adopted new section incorporates existing requirementslisted throughout the current rule, while clarifying the language



in new subsection (a). Subsection (a) is organized into para-graphs (1) - (4) , which include scope and applicability conditionscurrently found in existing §116.617. Proposed new subsection(a)(1) lists the three types of existing authorizations that maybe modi�ed by a state pollution control project standard permit.New subsection (a)(2) clari�es the types of projects that may beauthorized by a state pollution control project standard permit,reorganized from the existing §116.617 requirements.

New subsection (a)(3) outlines the prohibitions for use of thestate pollution control projects standard permit, clarifying the ex-isting intent and requirements of current §116.617. Speci�cally,subsection (a)(3) does not allow production facilities to be re-placed or modi�ed in any way under this authorization sincethese types of changes need to be reviewed for BACT and po-tential harmful effects to health and property in accordance withTexas Health and Safety Code (THSC), Chapter 382, the TexasClean Air Act (TCAA), §382.0518 and §116.610, unless the con-ditions of a standard permit or permit by rule are met. Subsec-tion (a)(3)(A) states that the standard permit will not be used toauthorize complete replacement of an existing facility or recon-struction of a production facility.

New subsection (a)(3)(B) states that any collateral emission in-crease associated with the state pollution control project stan-dard permit must not cause or contribute to any exceedance ofan NAAQS or cause adverse health effects. The commissionclari�ed subsection (a)(3)(C) to prohibit the use of the state pol-lution control project standard permit for the purpose of bringinga facility or group of facilities into compliance with an existing au-thorization or permit, unless approved by the executive director.

New subsection (a)(4) addresses how projects that have beenregistered under the previous version of §116.617 may continueto be authorized and subsequently meet the conditions of new116.617. Projects authorized prior to the effective date of thisrulemaking may defer the inclusion of emission increases or de-creases resulting from the project until future netting calcula-tions. Paragraph (4) allows currently authorized control projectsto continue operation uninterrupted until the ten-year renewal an-niversary of the original registration or until otherwise incorpo-rated into a permit or standard permit. The review period of 30days is extended to 45 days to allow evaluation of netting, whichwould be required under the state pollution control projects stan-dard permit.

New subsection (b) is organized into paragraphs (1) - (5) andincludes the general requirements dispersed throughout current§116.617. Subsection (b)(1) requires compliance with the spe-ci�c conditions of §116.604, Duration and Renewal of Regis-trations to Use Standard Permits; §116.605, Standard PermitAmendment and Revocation; §116.610, Applicability; §116.611,Registration to Use a Standard Permit; §116.614, Standard Per-mit Fees; and §116.615, General Conditions. While these re-quirements are not new, they are reorganized to emphasize andremind applicants of these conditions to ensure submittal of morecomplete registration information.

New subsection (b)(2) was proposed containing a new require-ment specifying that construction or implementation of the statepollution control projects standard permit must begin within180 days of receiving written acceptance of the registrationfrom the executive director, and that changes to maximumallowable emission rates are effective only upon completion orimplementation of the project. In response to public comment,the commission retained the traditional 18-month start of con-

struction window with one 18-month extension consistent with§116.120, Voiding of Permits.

New subsection (b)(3) exempts for state pollution controlprojects standard permits from the emission limits and distancerequirements of permit by rule, §106.261, as referenced in§116.610(a)(1). Pollution control projects are considered envi-ronmentally bene�cial so any emission increases associatedwith these projects do not require further authorization.

New subsection (b)(4) contains a new requirement that pre-dictable MSS emissions directly associated with the statepollution control projects standard permit be included in themaximum emissions represented in the registration application,consistent with the ongoing efforts of the commission to autho-rize all aspects of normal operations.

New subsection (b)(5) contains the same requirements as theprevious §116.617(5) and (6) and limits emission increases toonly those directly as a result of the pollution control project.Any incidental production capacity cannot be authorized by thestate pollution control projects standard permit, but requiressome other preconstruction authorization. In response to publiccomment, the commission included a provision allowing therecovery of lost capacity due to a derate.

New subsection (c) includes the same requirements as in cur-rent §116.617(4), as well as two new requirements. Subsec-tion (c) is organized into paragraphs (1) - (3) and pertains to re-quirements speci�c to replacement projects. Subsection (c)(1)repeats language from §116.617(4) and allows replacement con-trols or techniques to be different than those currently authorizedas long as the new project is at least as effective in control-ling emissions. Subsection (c)(2) allows for increases in MSSemissions if these emissions were reviewed as part of the origi-nal authorization for the existing control equipment or technique,and if the increases are necessary to implement the replacementproject. Subsection (c)(3) is intended to clarify that the applica-ble testing and recordkeeping requirements associated with thecurrently permitted control or technique apply to the replacementto ensure continuing compliance with associated emission limits.If the control or technique is substantially different than an exist-ing control or technique, applicants may also propose equivalentalternatives for review by the executive director.

New subsection (d) clari�es the requirements of current§116.617(4)(C), adds varying fees for different project types,and clearly speci�es documentation required in a state pollu-tion control projects standard permit registration application.New subsection (d)(1) includes existing language found incurrent §116.617(4)(C), but changes the required fees basedon whether the project or change in representation results in anincrease in the maximum authorized emission rates. Changesto fee requirements are adopted to encourage the installationand use of pollution control projects, especially where there isno increase in emissions or the changes require minimal review.This subsection also describes when a registration should besubmitted and when construction or implementation may begin.Various deadlines are proposed to provide �exibility and encour-age the use of pollution control projects. Regardless of thesedeadlines, all projects must meet all requirements of the statepollution control projects standard permit and the responsibilityto do so remains with the applicant at all times. New subsec-tion (d)(2) clari�es registration requirements. These include aprocess and project description, a list of affected permits andemission points, calculated emission rates, the basis of thoseemission rates, proposed monitoring and recordkeeping, and



the proposed method for incorporating the state pollution controlprojects standard permit into existing permits. In response topublic comment, the commission deleted the term "registrationapplication" and replaced it with "registration."

New subsection (e) incorporates requirements found in§116.615, General Conditions, but expands, clari�es, andfocuses those requirements speci�cally for the state pollutioncontrol projects standard permit. New subsection (e)(1) em-phasizes that a project should be constructed and operatedin accordance with good engineering practices to minimizeemissions. New subsection (e)(2) speci�cally requires copies ofdocumentation to be kept demonstrating compliance with thisstandard permit.

New subsection (f) provides clari�cation of the procedures for,and under what conditions, a state pollution control projectsstandard permit should be incorporated or administrativelyreferenced into a facility’s NSR authorization. New subsection(f)(1) applies to facilities authorized by a permit or standard per-mit. New subsection (f)(1) also applies to those state pollutioncontrol projects standard permits that authorize new facilitiesor changes in method of control and would require incorpo-ration upon the next amendment or renewal of the facility’sauthorization. The commission is not adopting the proposedrequirement for effects review in this rulemaking and will con-tinue to examine the issue during the consideration of additionalrulemaking concerning, among other topics, the incorporation ofstandard permit and permit by rule authorizations (Rule ProjectNo. 2005-016-106-PR, proposed by the commission in theDecember 30, 2005, issue of the Texas Register (30 TexReg8789, 8808).

New subsection (f)(2) applies to facilities authorized under a per-mit by rule and requires that all increases in previously autho-rized emissions, new facilities, or changes in method of con-trol or technique authorized by this standard permit comply with§106.4, except for the emission limitations in §106.4(a)(1) and§106.8.


This new section contains the identical language found previ-ously §116.410 and allows facility owners or operators to applyto the commission for a suspension of permit conditions for theaddition, repair, or replacement of control equipment in the eventof a catastrophe. This new section is adopted in order to reorga-nize this chapter to accommodate new sections associated withNSR reform and does not contain substantive changes.

FINAL REGULATORY IMPACT ANALYSIS DETERMINATION

The commission reviewed the adopted rulemaking in light of theregulatory impact analysis requirements of Texas GovernmentCode, §2001.0225, and determined that the rulemaking does notmeet the de�nition of a "major environmental rule." Furthermore,it does not meet any of the four applicability requirements listedin Texas Government Code, §2001.0225(a). A "major environ-mental rule" means a rule, the speci�c intent of which, is to pro-tect the environment or reduce risks to human health from envi-ronmental exposure, and that may adversely affect in a materialway the economy, a sector of the economy, productivity, compe-tition, jobs, the environment, or the public health and safety of thestate or a sector of the state. The rulemaking revises the rulesregarding federal permitting applicability, including adding addi-tional options under federal air quality permitting applicability andplant-wide applicability limit options. The commission modi�edthe rule since proposal to be consistent with the federal rule con-

cerning baseline emission determination, actual-to-projected ac-tual emissions test, and plant-wide applicability limits. The rule-making revises the existing pollution control projects standardpermit. In addition, the rulemaking modi�es and adds de�nitionsand changes some general formatting of this chapter. The rulesdo not adversely affect, in a material way, the economy, a sectorof the economy, productivity, competition, jobs, the environment,or the public health and safety of the state or a sector of the state.

In addition, Texas Government Code, §2001.0225, only appliesto a major environmental rule, the result of which is to: 1) ex-ceed a standard set by federal law, unless the rule is speci�-cally required by state law; 2) exceed an express requirement ofstate law, unless the rule is speci�cally required by federal law;3) exceed a requirement of a delegation agreement or contractbetween the state and an agency or representative of the fed-eral government to implement a state and federal program; or4) adopt a rule solely under the general powers of the agencyinstead of under a speci�c state law. The rules do not exceeda standard set by federal law or exceed an express requirementof state law. There is no contract or delegation agreement thatcovers the topic that is the subject of this rulemaking. Rather, thefederal permitting applicability rules are adopted to incorporatenew federal requirements to maintain SIP approval from EPA forthe commission’s federal air quality permitting program. The re-maining changes implement speci�c state law requirements orare administrative changes. Finally, this rulemaking was not de-veloped solely under the general powers of the agency, but isauthorized by speci�c sections of the THSC and the Texas Wa-ter Code (TWC) that are cited in the STATUTORY AUTHORITYsection of this preamble. Therefore, this rulemaking is not sub-ject to the regulatory analysis provisions of Texas GovernmentCode, §2001.0225(b), because the rules do not meet any of thefour applicability requirements.

TAKINGS IMPACT ASSESSMENT

The commission completed a takings impact analysis for the pro-posed rules. The speci�c purpose of this rulemaking is to re-vise the rules regarding federal permitting applicability, includ-ing adding additional options under federal air quality permittingapplicability and plant-wide applicability limit options. The rule-making revises the existing pollution control projects standardpermit, modi�es and adds de�nitions, and changes some gen-eral formatting of this chapter. Promulgation and enforcementof the proposed rules would be neither a statutory nor a consti-tutional taking because they do not affect private real property.Speci�cally, the rules do not affect private property in a man-ner that restricts or limits an owner’s right to the property thatwould otherwise exist in the absence of a governmental action.Therefore, the rules do not constitute a taking under Texas Gov-ernment Code, Chapter 2007.

CONSISTENCY WITH THE COASTAL MANAGEMENT PRO-GRAM

The commission determined that this rulemaking action relatesto an action or actions subject to the Texas Coastal Manage-ment Program (CMP) in accordance with the Coastal Coordina-tion Act of 1991, as amended (Texas Natural Resources Code,§§33.201 et seq.), and the commission’s rules in 30 TAC Chap-ter 281, Subchapter B, concerning Consistency with the CMP.As required by §281.45(a)(3) and 31 TAC §505.11(b)(2), relat-ing to Actions and Rules Subject to the Coastal ManagementProgram, the commission’s rules governing air pollutant emis-sions must be consistent with the applicable goals and policiesof the CMP. The commission reviewed this action for consistency



with the CMP goals and policies in accordance with the rules ofthe Coastal Coordination Council, and determined that the ac-tion is consistent with the applicable CMP goals and policies.The CMP goal applicable to this rulemaking action is the goalto protect, preserve, and enhance the diversity, quality, quan-tity, functions, and values of coastal natural resource areas (31TAC §501.12(l)). No new sources of air contaminants are autho-rized and the adopted revisions will maintain the same level ofemissions control as the existing rules. The CMP policy applica-ble to this rulemaking action is the policy that the commission’srules comply with federal regulations in 40 CFR, to protect andenhance air quality in the coastal areas (§501.14(q)). This rule-making action complies with 40 CFR Part 51, Requirements forPreparation, Adoption, and Submittal of Implementation Plans.Therefore, in accordance with §505.22(e), the commission af-�rms that this rulemaking action is consistent with CMP goalsand policies.

EFFECT ON SITES SUBJECT TO THE FEDERAL OPERATINGPERMITS PROGRAM

The new and amended sections in this adoption are applica-ble requirements under Chapter 122, Federal Operating PermitsProgram. Upon the effective date of this rulemaking, owners oroperators subject to the Federal Operating Permit Program thatmodify any NSR authorized sources at their sites will be subjectto the amended requirements of these sections.

PUBLIC COMMENT

The commission held a public hearing on the proposal in Austinon October 27, 2005. During the public comment period, whichclosed on October 31, 2005, the commission received 17 writtencomments. All of the commenters opposed the proposal.

RESPONSE TO COMMENTS

EPA, Baker Botts on behalf of the Texas Industry Project (TIP),Dow Chemical Company (Dow), Association of Electric Compa-nies of Texas, Inc. (AECT), Texas Pipeline Association (TPA),Texas Chemical Council (TCC), ExxonMobil Re�ning and Sup-ply (ExxonMobil), City of Houston, Department of Health andHuman Services (HDH), TexasGenco, Sempra Texas Services,LP (Sempra), Texas Instruments (TI), BP Products North Amer-ica, Inc. (BP), Calpine, Entergy Services, Inc. (Entergy), Inter-national Paper, JD Consulting, L.P. (JDC), Celanese Chemicals(Celanese), and the Lone Star Chapter of the Solid Waste Asso-ciation of North America (TxWANA) submitted written commentsduring the public comment period. All of the commenters op-posed the proposal.

TIP, AECT, TPA, TCC, TexasGenco, TI, BP, Calpine, Entergy,International Paper, Celanese, and Dow commented that sub-stantial departures from federal NSR rules introduce confusionand inconsistencies particularly for companies with multi-stateoperations, and the introduction of less �exible triggers for fed-eral NSR generates a competitive disadvantage for affected in-dustries. They also commented that TCEQ has traditionally keptfederal NSR review separate from permitting procedures underthe TCAA and that changes in federal review do not affect theestablished TCEQ permitting program. They also mentioned thedecision of the United States District Court that upheld EPA’srules on actual-to-projected actual emissions and plant-wide ap-plicability limits as further reason not to adopt substantial differ-ences with the federal NSR reform rules.

TIP, AECT, TPA, TCC, ExxonMobil, TI, BP, Calpine, Entergy, In-ternational Paper, JDC, Celanese, and Dow commented further

that the commission proposal for PALs defeats the purpose of afederal PAL by introducing the BACT criterion. PAL applicantscurrently holding �exible permits could use ten-year old BACT,while those applicants without a �exible permit would require cur-rent BACT, causing an inequity. Plant units not under a PALwould be subject to traditional NSR evaluation. They believethere is not a sound legal basis for applying NSR review to aportion of a plant or project and is inconsistent with federal rules.The commenters noted the operational �exibility and stakeholdervetting that are part of the federal rule. TPA also stated that therewere insuf�cient details on the concept of an east/west split ofthe state for the implementation of PALs and stated the federalplan should be offered statewide. JDC also suggested adding aprovision allowing the conversion of existing �exible permits toPALs.

The commission’s proposal on NSR reform was intended to inte-grate the federal revisions within an existing state program thataddressed similar situations concerning plant-wide emission lim-its and baseline emission determinations. The commission alsosolicited comments from affected industries on the relative ben-e�ts of an integrated program versus an incorporation of the fed-eral program without substantive changes. It is clear from stake-holder meetings and public comment that a program matchingthe federal rules is the preferred method of accomplishing fed-eral NSR reform. The commission agrees that it has tradition-ally approached state NSR permitting separately from federalNSR requirements. Additionally, the commission determinedthat it can continue this approach under federal NSR reform with-out endangering the attainment of maintenance of NAAQS oraffecting public health. The commission is changing the pro-posal accordingly to adopt rules implementing the federal pro-gram on plant-wide applicability limits, actual to projected actualemissions test, and baseline determination without substantivechanges to the federal model for these programs.

In summary, PALs may now be considered without speci�cBACT application to each facility covered under the PAL with asite-wide PAL established as a sum of each facility’s baselineemissions. Federal NSR will be required only if there is anincrease sought in the PAL. The rules will allow the use of aprojected actual emission increase instead of potential to emitin determining project emission increases. Project emissionincreases may also be reduced by an amount equal to what mayhave been accommodated within a facility’s baseline period.

TIP commented that the proposed rule lacked a regulatory im-pact analysis. This analysis is required when a major environ-mental rule exceeds a standard set by federal law unless specif-ically required under state law. The signi�cant departures fromfederal law regarding PALs and exclusion of compliant emissionsexceeds requirements of federal law.

The commission is adopting rules without substantive differencefrom federal rules concerning NSR reform and determined thatadditional regulatory impact analysis is not required.

EPA commented that the de�nition of actual emissions uses atwo-year period where the federal rule uses a 24-month periodand requested clari�cation as the two terms are not necessarilyidentical.

The commission agrees with this comment, and the rule hasbeen revised by replacing two-year period with 24 months.

TIP and TPA commented that the de�nition of baseline actualemissions should use the phrase "rate of emissions" instead of"average rate of emissions" as it is closer to federal language.



The commission agrees with the comment, and the phrase "av-erage rate of actual emissions" has been replaced with "rate ofemissions."

AECT questioned if the term "facility" has the same meaning in§116.10, and 116.12. Additionally, the term "reviewing authority"should be replaced with "executive director" throughout the newlanguage in §116.12.

The term "facility" is based on the TCAA and has the same mean-ing throughout Chapter 116 unless stated otherwise. The com-mission agrees that the term "reviewing authority" could be con-fusing, and it has been replaced with the term "executive direc-tor" in the de�nitions for baseline actual emissions and net emis-sion increase.

TIP, AECT, TPA, TCC, ExxonMobil, Sempra, TI, BP, Calpine, En-tergy, International Paper, Celanese, and Dow expressed con-cern that the current rule language will exclude malfunction emis-sions from any baseline consideration. The commenters statedthat the preamble indicates that the rule language is intended toinclude MSS emissions, but it does not clearly accomplish thisand appears to cut off inclusion in 2016. They also stated thatmalfunction emissions, if compliant with federal and state rules,should not be excluded from baseline emissions. They believeissues associated with the authorization of compliant emissionsshould be addressed in upcoming commission rulemakings inChapter 101, General Air Quality Rules, and Chapter 116. TIPalso commented that it is not necessary to depart from usingactual emissions as representative of the �rst two years of newsource operation. AECT commented that speci�c language au-thorizing MSS and emission events should be included in thede�nition of baseline actual emissions. TPA suggested adding ade�nition of noncompliant emissions.

The federal rule requires that baseline emissions include startup,shutdown, and malfunctions. EPA requested con�rmation thatthe commission’s proposal would include these emissions indetermining compliance with SIP-approved permit limits. EPAquestioned whether the commission intended to retroactivelyauthorize past excess emissions and how baseline emissionswill be determined for sources whose startup, shutdown, andmalfunction emissions have not been previously authorized.EPA also stated that emissions from startup, shutdown, andmalfunctions are not included in the proposed de�nition ofprojected actual emissions or in the baseline determination offacilities included under a PAL.

The commission is not changing the rule in response to thiscomment. The de�nition of baseline actual emissions requiresthe exclusion of "noncompliant" emissions from baseline calcula-tions. Baseline MSS emissions may not currently be authorizedbut future MSS emissions from the modi�ed or affected facilitiesmust be authorized.

TIP, TPA, and Dow commented that the proposed de�nition ofnet emissions increase is inconsistent with TCEQ’s recent adop-tion of eight-hour ozone NSR standards, which allows reductionsmade under mass emissions cap and trade programs to be cred-itable for netting. The proposed de�nition disallows decreasesthat have been relied on in SIPs. AECT and TPA commentedthat this de�nition should refer to the de�nition of baseline actualemissions and the inclusion of MSS and malfunction emissionswhen calculating a net emission increase. AECT and TPA madethe same comment concerning the de�nition of project net.

The commission is changing the de�nitions of net emissions in-crease and project net in response to this comment. Baseline

actual emissions are referenced in these de�nitions. Cap andtrade reductions are allowed in netting calculations. The com-mission does not rely on any facility or site-speci�c emission de-crease to demonstrate attainment or reasonable further progresswhen using cap and trade programs to provide for emission re-ductions. A cap and trade program ensures that there must be areal emission decease somewhere in the air shed if there is anemission increase. The �ve-year netting window ensures thatany emission decreases at a site are contemporaneous with pro-posed increases.

TPA requested a clari�cation of the term "enforceable as a prac-tical matter," as used in the preamble, when assigning credits foremission reductions.

The commission is changing the rule language in response tothis comment and will use the term "enforceable." Limits that areenforceable require demonstration through such measures asdocumentation, inspection, and monitoring.

AECT commented that the second sentence of §116.12(28)(A)in the de�nition of project emission increase concerning calcula-tion of emission increases should be moved to §116.12(27), thede�nition of projected actual emissions. AECT also commentedthat the use of "modi�ed" and "affected" are unde�ned and thephrase "at the stationary source" should be added after "facility"in the introductory phrase.

The commission is not changing the rule in response to thesecomments. The commission determined that the language con-cerning calculation of emissions is properly located because theconsideration of what emissions could have been accommo-dated in the baseline period is part of determining the projectemissions increase, not the projected actual emissions. Theterms "modi�ed" and "affected" are used in the EPA rule andguidance, are consistent with everyday usage, and consistentwith commission practice, and do not require a de�nition in therule. The commenter’s suggestion of adding the phrase "at thestationary source" would be inconsistent with EPA rules, whichdo not limit the project emission increase to facilities at the sta-tionary source.

AECT commented that the de�nition of de minimis threshold testcontains the term "major modi�cation threshold" that should bede�ned in §116.12.

The commission agrees with this comment and is modifying thede�nitions for more consistent and accurate use of terms thatare consistent with federal use. The term "major modi�cationthreshold" has been replaced with "signi�cant level" in the de�-nition for major modi�cation (including Table I) and the de�nitionof de minimis threshold test. The signi�cant level is identi�ed inthe de�nition for major modi�cation.

AECT commented that the term "federally regulated new sourcereview pollutant" in §116.12(13) differs signi�cantly from thesame de�nition in the federal NSR reform rules. AECT ques-tioned the basis for the difference.

The commission is changing the rule in response to this com-ment to add a cited de�nition containing references to federalde�nitions for the determination of a federally regulated NSR pol-lutant.

AECT commented that the de�nition of major stationary sourcein §116.12(15) contains a sentence stating "a source that is ma-jor for one PSD pollutant is considered major for all PSD pollu-tants." AECT stated that there is no support for the sentence inEPA rules or guidance.



The commission disagrees that this concept requires change.The commission modi�ed this sentence to clearly indicate thata source that has emissions of any federally regulated NSR pol-lutant greater than the major source level is a major stationarysource for all PSD pollutants. This policy is consistent with theEPA de�nition of major stationary source and federal guidance.

AECT commented that the de�nition of major modi�cation in§116.12(16) should be changed to indicate that a project emis-sion increase and the net emission increase must be at or abovethe major source threshold for the modi�cation to be consideredmajor. This concept should also be applied at non-PAL facilities.

The commission is not changing the rule in response to this com-ment. At major stationary sources, the project emission increaseand the net emission increase must be greater than the signi�-cant level (or threshold) for the modi�cation to be major. If thesource is not major, the project emissions increase must exceedthe major source threshold for the modi�cation to be major. Thisis consistent with federal applications.

TxWANA requested clari�cation that provisions in the de�nitionof major source in §116.12 exempting the use of alternate fuelsfrom being considered a major modi�cation would apply to land-�ll-generated gas.

The commission agrees with this comment. The use of land�llgas as an alternate fuel, if that is the only change, would notconstitute a major modi�cation.

EPA questioned whether a signi�cant emission increase deter-mination would yield the same result under state and federalrules.

The commission is not changing the rule in response to this com-ment. A signi�cant emission increase would be the same un-der the commission’s rule as it would be under the federal lan-guage. Emissions that deviate from those authorized are con-sidered noncompliant and the treatment of the associated emis-sions would vary, depending on the circumstances. For exam-ple, if a unit’s annual operating hours were limited to 2,000, theallowable emission rate associated with operating beyond 2,000hours would be considered zero, regardless of whether the tonsper year limit had been exceeded by the source. If the hourlyemission rate had been exceeded, emissions above the hourlyemissions rate would be considered noncompliant and would notbe in the baseline.

EPA requested clari�cation that the commission consider munic-ipal incinerators capable of charging 50 tons of refuse per dayas major sources.

The commission considers these municipal incinerators as majorsources.

EPA requested clari�cation of the provision in the de�nition ofmajor modi�cation that allows a change in a facility in a PAL thatcauses a signi�cant increase for a pollutant at a non-PAL facilityto be considered a major modi�cation.

Consistent with its decision to adopt rules equivalent with thefederal PAL, the commission removed this language. Emissionincreases will be included in PAL and will constitute a major mod-i�cation only if the PAL is exceeded by a signi�cant level.

EPA requested clari�cation of the term "federal permit of thesame type" as used in §116.12(18)(A)(ii). Further, there is noprovision stating that an increase or decrease in sulfur dioxide,particulate matter, or nitrogen oxides occurring before a minor

source baseline date is creditable only if it is required in calcu-lating the amount of maximum increases that remain available.

The commission is changing the rule in response to thesecomments, for clarity, and substituted the term "NSR permit" forpermit of the "same type." The commission is also adding theEPA-recommended change concerning increases or decreasesin sulfur dioxide, particulate matter, or nitrogen oxides for con-sistency with federal rules.

EPA questioned why the commission is not allowing credit foremission decreases in §116.12(18)(C)(iii) if it is relied upon forissuing a PAL. EPA also questioned why reduction credits cannotbe used in determining an offset ratio if the reduction was usedin issuing a PAL.

Consistent with its decision to adopt rules equivalent with thefederal PAL, the commission removed this language.

EPA commented that the following de�nitions were not proposedfor the commission’s PAL program and should be added or anequivalency demonstration provided: allowable emissions,small emissions unit, major emissions unit, major facility, PALeffective period, and signi�cant emissions unit.

Allowable emissions are de�ned in §116.10. The PAL is beingincorporated into the commission rules in the same manner asstate NSR permits. The PAL permits will have the same ten-yearrenewal requirement, and it has not been necessary to de�ne aneffective period. Consistent with its decision to adopt rules equiv-alent with the federal PAL, the de�nitions for major facility, smallfacility, and signi�cant facility have been added. The commis-sion used the term "facility" as a substitute for "emissions unit"for consistency with its use of terms. The term "facility" is syn-onymous with "emissions unit."

EPA commented that the de�nition of PAL major modi�cationlacked the federal de�nitions of major modi�cation and netemissions increase and requested an equivalency demonstra-tion based on their exclusion.

The commission is not changing the rule in response to the com-ment. The EPA de�nition for PAL major modi�cation containslanguage that states "notwithstanding the de�nitions for majormodi�cation and net emissions increase." These de�nitions al-ready exempt PAL facilities so the additional language is unnec-essary.

EPA commented that the de�nition of PAL pollutant does notrequire that the PAL be established at a major source.

Consistent with its decision to adopt a PAL program equivalentwith the federal model, the commission added the suggestedlanguage to the de�nition.

EPA commented that §116.121(e) differs from the federal ruleand only requires that information documenting projected actualemissions and any excluded emissions be available for reviewby the executive director and the general public. For equivalencywith the federal rule, all information required under §116.121must be made available to the executive director and the generalpublic.

Consistent with its decision to adopt a PAL equivalent with thefederal model, the commission added the necessary languagein this section.

AECT suggested revising the �rst sentence in §116.121(a) torefer to a "project emission increase" because that is a de�nedterm. A similar change should be made in §116.151.



The commission did not change §116.121(a) in response to thiscomment. The project emission increase must be determined forevery project and is compared to the signi�cance level. It may bedetermined using projected actual emissions and/or excludingemissions that could have been accommodated in the baselineand will therefore be subject to the requirements of §116.121. If itwere determined using the potential to emit, these requirementswould not apply.

EPA commented that §116.150 makes nonattainment review inrelation to a change in an area’s attainment status contingenton the date that a complete permit application is received. Thisdiffers from federal guidance, which bases nonattainment reviewon the issuance date of a permit.

In order to remain consistent with federal rules, the commissionremoved the date from the rule.

EPA, TIP, and Dow commented that the commission shouldmodify §116.150(c)(3) to state that any increase in volatileorganic compounds or nitrogen oxides that exceeds the majormodi�cation threshold in the de�nition of major modi�cation willbe subject to a netting test. Dow stated that the concept couldalso be incorporated by adding to the de�nition of project net in§116.12.

The commission agreed with the comment, and §116.150(c)(3)has been revised to clarify when a netting test will be required.

AECT commented that the terms "facility" and "facilities" in§116.151 should be replaced with "stationary source(s)" andthat the term "modi�cation" is unde�ned. In subsection (c),the term "aggregated over the contemporaneous period" issuper�uous as the concept is included in the de�ned term "netemissions increase." AECT made similar comments about theuse of these terms in §116.160 and also suggested that theterm "major source" be replaced with "major stationary source."

The commission disagrees with AECT about the use of the term"facility." The commission’s current NSR permitting program isbased on the authorization of facilities and the term is de�nedin THSC, TCAA, Chapter 382, §382.002(6) and in the commis-sion’s rules. The use of the term is well-established and causesno signi�cant difference in the issuance of PAL permits. Thecommission determined that the term is used appropriately in§116.151 and 116.160. The term "modi�cation" has not beende�ned by EPA for NSR and the commission determined thata Texas de�nition is not appropriate or necessary because theterm has an accepted meaning, and the term "modi�cation of ex-isting facility" is de�ned in TCAA, §382.002(9). The commissionagrees with AECT concerning the use of the term "aggregatedover the contemporaneous period" and the term has been re-moved from §§116.150, 116.151, and 116.160. The terms "majorsource" and "major stationary source" have the same meaning,and the commission has not made the suggested change.

EPA commented that the commission should con�rm that "re-placement units" as referenced in §116.151 and §116.160 will betreated as existing units for purposes of federal NSR and emis-sion reductions from the shutdown of a replaced unit will not beused for netting or offsets.

The commission agrees with this comment and added de�nitionsto §116.12 for "Replacement facility" and "Basic design param-eters" to address EPA concerns.

AECT commented that the understanding is that the date July 1,1999, in §116.160(c)(1) refers only to the phrase "the de�nitionsfor protection of visibility and promulgated in 40 CFR §51.301"

and does not apply to 40 CFR §52.21. If this is not the case, thecommission will have failed to incorporate 40 CFR §52.21 andthe NSR reform rule adopted in December 2002.

AECT’s understanding is correct; the July 1, 1999, date does notapply to 40 CFR §52.21.

Dow, Calpine, International Paper, Celanese, and TI commentedthat the provision in §116.160(c)(4) requiring a determination toissue a PSD permit within one year after receipt of a completedapplication should be deleted. The commenters agreed thatmost permits can be issued within that time frame, but permittiming should not be added to regulations so as to allow maxi-mum �exibility to resolve complex technical issues.

The commission agrees with this comment and removed theone-year requirement.

TxWANA commented that the commission should create analternative permitting process for land�ll gas-to-energy projectsthat would allow for quicker authorization of those projects thatqualify as major sources or major modi�cations. The com-menter’s speci�c suggestion is that the municipal solid wasteland�ll air standard permit currently proposed as an amendmentto 30 TAC Chapter 330, Municipal Solid Waste, be used as thebase authorization mechanism. Land�ll gas projects that wouldqualify as major would, by rule, be directed into case-by-casepermit review under Chapter 116 but would be exempt fromcontested case hearings. TxWANA stated that this abbreviatedprocess would help promote these environmentally bene�cialprojects.

The commission did not change the rule in response to this com-ment. The subject of an abbreviated permitting process for majorsource land�ll gas energy projects was not in the proposal andthus unavailable for public comment. The commission staff isevaluating TxWANA’s proposal for a possible future rulemaking.

EPA requested that the commission explain how its permittingprocess allowing the establishment of a separate PAL permitworks with the federal requirement to establish a PAL within anexisting permit. The commenter also requested an explanationof how a partial PAL (one not covering all facilities at a site) willdetermine NSR applicability, including netting procedures, fornon-PAL facilities. EPA also requested an explanation of howconditions in individual permits remain in effect after issuance ofa PAL permit.

The commission is unaware of any requirement to establish thePAL in an existing NSR permit and expects that most PALs willbe consolidated with an existing state NSR permit. The commis-sion sees no reason to limit the option of establishing a separatePAL permit for a site. The commission decided to adopt a PALcloser to the EPA model so the partial PAL has been removedas an option. A PAL permit contains the conditions necessary tosatisfy PAL requirements and has no effect on the requirementsassociated with any state NSR authorization.

EPA commented that §116.186 requires that each PAL containall the requirements of a PAL as listed in 40 CFR §51.165 and§51.166. It is not clear that the commission’s rule contains thisrequirement or the requirement that PAL facilities use a monitor-ing system meeting the requirements of 40 CFR §51.165(f) and§51.166(w).

The commission is adopting language consistent with the fed-eral requirements. To simplify use of this rule, the commission isincluding the necessary language in §116.186 rather than adoptthe federal requirements by reference. The language concerning



monitoring was added as §116.186(b)(4)(C) and (D). The com-mission also added subsection (b)(10) allowing the extension ofa PAL while an application for renewal is being considered.

TIP commented that language in §116.186(b)(1) - (4) and§116.186(b)(6) and (7) is not found in the federal PAL rule andthat the commission should deviate from the federal require-ments only when necessary to integrate PAL into the commis-sion rules. It made the same comment on §116.186(c)(2)(E),concerning alternative monitoring approach and subsection(c)(4), concerning implementation schedules for installation ofBACT or BACT-equivalent controls.

The commission is retaining §116.186(b)(1) - (4) and§116.186(6) and (7) in this adoption. These paragraphs identifyprocedures and requirements for sampling and recordkeepingthat ensure proper communication with the commission andcompliance with the permit and do not con�ict with the federalPAL rule. The commission is also retaining §116.186(c)(2)(E)because it determined alternative monitoring is a part of thefederal PAL rule. The commission did not adopt §116.186(c)(4)because it was inconsistent with the federal PAL rule.

EPA requested that the commission clarify whether its rule willestablish a PAL based on the application of BACT or baselineactual emissions of included facilities. It also requested that thecommission explain the use of allowable emissions in place ofpotential to emit when considering addition of facilities to a PAL.EPA commented that the commission’s rules do not contain theprovision requiring subtraction of emission level from a PAL forpermanently shut down facilities.

Consistent with its decision to adopt a PAL equivalent with thefederal model, the commission set the PAL based on baselineemissions. Facilities in the PAL are still subject to state permit-ting requirements, including any allowable emissions rate autho-rized by state law that effectively limits the potential to emit ofthat facility. The provision requiring subtraction of emission levelfrom a PAL for permanently shut down facilities has been addedto §116.188, Plant-wide Applicability Limit.

TIP commented that language in §116.188(1) - (3), concerningaddition of signi�cance levels to PALs and use of potential toemit for new facilities added to a PAL is not comparable to thefederal rule and that the commission should deviate from thefederal requirements only when necessary to integrate PAL intothe commission rules.

The commission disagrees with the comment. The federal lan-guage addresses signi�cance levels in PALs and the use of po-tential to emit in 40 CFR §51.165(f)(6) and §51.166(w)(6). Thecommission is retaining the language in §116.188(1) and (2).The commission agrees that §116.188(3) is not necessary andit has been removed from the rule.

EPA stated that §116.188 has no provisions corresponding tofederal rules for requesting an increase in a PAL and it is un-aware of a federal requirement to remove baseline emissions ofnew or modi�ed facilities from the PAL. EPA also commentedthat §116.188(4) discusses regulatory requirements that have afuture compliance date but closes the provision by referring torequirements that are effective prior to PAL issuance. The com-menter requested that the commission clarify this provision anddemonstrate how it meets federal requirements.

Consistent with its decision to adopt a version of PAL closer tothe federal model, the commission removed the noted languagethat is not required under the federal rules.

EPA stated that §116.190 does not contain a federally equiva-lent provision that a physical or operational change not causingan exceedance of a PAL is not subject to federal restrictions onrelaxing enforceable emission limitations to avoid NSR review.

Consistent with its decision to adopt a version of PAL equivalentto the federal model, the commission added the federally equiv-alent language as a new subsection (c).

EPA and TIP commented that the federal PAL requirements al-low the permitting authority to consider the application of BACTor equivalent technology where a facility proposes to add or mod-ify units in such a way as to cause an exceedance of the PAL.Such an increase would be authorized only if the source wouldnot be able to maintain emissions below the PAL, assuming ap-plication of BACT or BACT-equivalent controls. EPA requestedan explanation of how the commission’s requirement to installBACT compares with the federal rule. The commenter also re-quested that the commission explain how its requirements to in-crease the PAL compare to the federal rule. TIP stated that theterm "major modi�cation" is used rather than "PAL major modi-�cation" and that a control technology implementation schedulefor BACT went beyond federal requirements.

Consistent with its decision to adopt a PAL equivalent to the fed-eral model, the commission added §116.192(a)(1) addressingthe issue of potential BACT application when a PAL permit holderseeks an amendment or alteration.

EPA stated that the commission has not addressed these areasin its proposed PAL rules: contents of a PAL permit; reopeninga PAL permit; increasing a PAL; revalidation of data used to es-tablish a PAL; and recordkeeping.

Consistent with its decision to adopt a PAL equivalent to thefederal model, the commission made extensive revisions to§116.192 that include the requirements for reopening a PALpermit and increasing a PAL. Additionally, the commissionexpanded the recordkeeping requirements in §116.186(b)(4)to incorporate all the requirements in the EPA rule. Section116.186 speci�es the contents of a PAL permit and includesEPA requirements with the addition of §116.186(b)(10). Therevalidation of data used to establish the PAL was in the pro-posed rule and is found in §116.186(b)(9) of the adopted rule.

EPA commented that the permit alteration and amendment ofprovisions in §116.192 must be consistent with the SIP-approvedprovisions of §116.116, Changes to Facilities.

The commission disagrees with this comment. Section 116.116identi�es requirements associated with the authorization of facil-ities that emit air contaminants. A PAL permit does not authorizefacilities that emit air contaminants and is not subject to those re-quirements.

EPA commented that the commission appears to rely on 30 TACChapter 39, Public Notice, to meet the public notice require-ments for PALs and noted that a second public notice prior topermit issuance is not required for all air permits and may notbe consistent with federal requirements to notify the public ofthe agency’s approval of a permit. EPA also commented thatChapter 39 has not been approved into the Texas SIP. EPA alsostated that PALs are not referenced in Chapter 39 and requesteda summary of Chapter 39 requirements for initial, renewed, oramended PALs.

The commission modi�ed §116.194, Public Notice and Com-ment, to require noti�cation of intent to issue a permit allowingfor public comment and an executive director response. The



commission determined that they are equivalent to federal no-tice requirements for PALs. Although Chapter 39 has not beenapproved by EPA as a revision to the SIP, the commission treatsthe rules, �rst submitted in 1999, as SIP requirements. A refer-ence to PALs in Chapter 39 is not necessary and could not beadded at this adoption because the applicable sections were notopened for public notice.

EPA commented that the requirements in §116.196 to identifyquali�ed facilities under §116.10 and to include rolling 12-monthemission rates for non-quali�ed facilities are not in federal rulesand requested a demonstration that such inclusions result in aprogram at least as stringent as the federal PAL. TIP also notedthis difference between the proposal and the federal rule andurged the commission to adopt the federal PAL without substan-tive differences.

Consistent with its decision to adopt a PAL equivalent to the fed-eral model, the commission removed the reference language inthe adopted rule.

EPA commented that §116.196(e)(B) would be clearer if thecommission stated that the PAL is being set at a higher level inaccordance with §116.188(3) and §116.192(a).

The commission agrees with this comment and §116.192(a) hasbeen referenced as suggested.

EPA commented that §116.198 is not clear on whether a PAL thatis not renewed expires at the end of the PAL effective period in 40CFR §51.165(f)(9)(B). It also commented that the section doesnot have a requirement to include proposed allowable emissionlimits for each emission unit within the federal time frame for PALrenewals or to adjust emissions. The requirement in the sectionthat requires documentation of technology upgrades is not foundin federal rules.

Consistent with its decision to adopt a PAL equivalent to thefederal model, the commission is adopting EPA’s recommendedadditions. The commission removed the language concerningthe documentation of technology upgrades because this require-ment is not in the federal rule.

AECT commented that §116.610(b) should be revised to referto major stationary sources, rather than "major source or majormodi�cation," and also reference §116.12 as the location of thede�nition of major modi�cation.

For consistency in the use of terms, the commission is modifyingthe appropriate term to refer to major stationary sources and in-cluded a reference to §116.12 as the location for the de�nitionsrather than a federal rule reference.

HDH commented that the public comment period was too shortand should be extended with additional hearings in Dallas, Hous-ton, and Beaumont.

The commission disagrees that the chance for public participa-tion in development of this proposal was too short. The com-mission met its legal obligation for length of the public commentperiod and conducted two stakeholder meetings during the de-velopment of this proposal. Representatives of industry and en-vironmental organizations were invited on both occasions.

HDH commented that it encourages state rules that are morestringent than the federal. The City of Houston, along with sev-eral urban areas within the state, is currently classi�ed as nonat-tainment and it views the more stringent rules as aids towardachieving attainment, or at least maintaining the severity of thenonattainment designations.

The commission did not change the rule in response to the com-ment. Neither state permitting law nor the federal NSR permit-ting program are designed to be control measures for speci�cnonattainment areas. The commission adopted speci�c rules re-garding control of nitrogen oxide and volatile organic compoundemissions from facilities in Houston and other nonattainment ar-eas in its efforts to attain the NAAQS. The commission will con-sider more stringent rules if air quality goals are not achieved.

TIP, Entergy, Calpine, BP, TI, Celanese, and AECT commentedthat beyond the netting change required in response to the Dis-trict of Columbia Circuit Court decision in State of New York, et al.v. United States Environmental Protection Agency, the proposedchanges to the existing state Pollution Control Project StandardPermit are unnecessary and inappropriate.

The commission is not changing the rule language in responseto this comment. In addition to the change concerning nettingon pollution control projects required as a result of this courtdecision concerning NSR reform, the commission is adoptingchanges to §116.617, which are intended to clarify languageand improve organization and readability. These changes in-clude grouping similar or related requirements together and or-dering those groups in a logical progression. To better organizegeneral requirements for standard permits, the applicable con-ditions of Chapter 116, Subchapter F, Standard Permits, wereadded in subsection (b), and a list of registration requirementswere added to subsection (d) to ensure that all registration in-formation is submitted. Similarly, subsection (e) incorporatesrequirements found in §116.615, General Conditions, and ex-pands, clari�es, and focuses them speci�cally for the state pol-lution control project standard permit.

TIP requested con�rmation that the standard permit still autho-rizes collateral emission increases for state NSR purposes. TIPcommented that §116.617(9) should be retained.

TIP is correct that the pollution control project standard permitwill authorize collateral emission increases. The commissiondetermined that §116.617(9) is redundant in this adopted ver-sion of the pollution control project. Projects authorized underthis standard permit will be evaluated through netting for signif-icance. Any project qualifying as a signi�cant change will bereferred into the appropriate authorization methods of Chapter116. Projects remaining below the signi�cant level are not af-fected.

EPA commented that it does not consider this a good time forthe commission to adopt any kind of pollution control regulationbecause of pending litigation concerning the District of ColumbiaCircuit Court decision, which vacated the federal pollution controlproject rule.

The commission is not changing the rule in response to this com-ment. The state pollution control project rule being amended isindependent of the federal pollution control project rule vacatedby the court. The federal rule addressed the issue of exclusionof pollution control project emissions from federal NSR or PSDreview, a subject not addressed in the state rule. Litigation, ap-peals, and interpretation of court decisions may not be resolvedfor some time, and the commission desires to continue autho-rizing bene�cial projects that reduce the quantity and severity ofpollutants emitted to the atmosphere.

EPA requested the commission’s rationale for qualifying thesubstitution of compounds as a pollution control project under§116.617(a)(2)(C).



The commission determined that substituting compounds usedin manufacturing can reduce or control the amount of pollutionemitted to the atmosphere and is therefore within the originalscope and intent of the pollution control project. This substitutionmust be approved by the executive director.

TIP, TPA, TCC, and AECT all commented on §116.617(a)(4),which requires that past increases authorized under a standardpermit be included in netting. The commenters claim thatthe retroactive nature of this requirement is unnecessary andimpractical and request that the requirement only be appliedprospectively.

The commission is not changing the rule in response to thiscomment and disagrees that the requirement is unnecessary.The commission determined that pollution control projects, eventhose with incidental emission increases in other contaminants,are bene�cial to the environment, and wants to encourage them.However, in order to remain consistent with the previous rule,the emission increases and decreases from the pollution controlproject must be shown in subsequent site netting exercises. Therequirement for immediate netting on new projects was added asa result of the District of Columbia Circuit Court decision.

TIP and EPA commented that they will review the pollution con-trol project for consistency with 40 CFR §51.160 and §51.161.They asked the commission for a determination of whether theincidental emission increases resulting from projects could inter-fere with attainment or maintenance of NAAQS. In addition, EPAasked how the pollution control project complies with the publicparticipation requirements of 40 CFR §51.161, particularly con-cerning §116.617(d)(1)(B), which allows for increases in emis-sions without public notice.

The commission is not changing the rule in response to thesecomments. The new pollution control project contains languageprohibiting incidental emission increases that would preventachievement of an NAAQS. Speci�cally, under §116.617(a)(4),all increases and decreases must be included in netting cal-culations. If the project emission increases are not belowsigni�cance thresholds for PSD or nonattainment review, thestandard permit cannot be used. For projects under PSD ornonattainment thresholds, the maximum emission rates identi-�ed in the standard permit registration serve as an enforceableemission limit.

The executive director uses the 30-day period prior to start ofconstruction to verify that the collateral emissions are prop-erly quanti�ed and that there is not a signi�cant net emissionincrease associated with the proposed project. Incidental in-creases associated with a pollution control project must haveno harmful off-property effects, and the commission determinedthat the emission decreases are of bene�t to the environment.Based on these conditions, the commission further determinedthat a public review of each individual application of the pollutioncontrol project was not necessary and would slow bene�cialprojects. This is not a new condition of the pollution controlproject, and the provision was available for public comment atthe original adoption of the pollution control project and duringthis amendment.

TIP, AECT, and Dow commented that the proposed §116.617(f)requires impacts review upon a mandatory incorporation of thestandard permit into an existing NSR permit. The TCAA doesnot require a re-review of project effects on incorporation.

The pollution control project standard permit can be used tomake physical or operational changes at a facility instead of

a permit amendment under §116.110, Applicability, and noeffects review is required for initial construction. An effectsreview will be required at the incorporation of the pollutioncontrol project into the NSR permit. The commission is notadopting the proposed requirement for effects review in thisrulemaking and will continue to examine the issue during theconsideration of additional rulemaking concerning, among othertopics, the incorporation of standard permit and permit by ruleauthorizations (Rule Project No. 2005-016-106-PR, proposedby the commission in the December 30, 2005, issue of theTexas Register (30 TexReg 8789, 8808).

TIP, AECT, and Dow commented regarding the requirement in§116.617(b)(2) limiting the start of construction to within 180days of registration. They stated that the commission tradition-ally allows up to 18 months to start construction, and reducingthe time allowed is unnecessary and unreasonable. Theysuggested that the time allowed be increased to 18 months withan automatic 18-month extension to be consistent with otherstate and federal rules and guidance. Dow also requested thatthe commission remove the requirement to notify upon the startof construction and the start of operation.

The commission agrees with the comment and is modifying therule language. The commission is retaining the start of con-struction and operation noti�cation in order to track constructionprogress.

TIP, AECT, and Dow commented that the proposed requirementthat MSS emissions associated with replacement projects canonly be authorized if necessary to the control project and autho-rized originally is contrary to the initiative to authorize MSS emis-sions and has no relationship to NSR reform. They also com-mented that provisions requiring the permitting of predictableemissions appear to be out of context in this rulemaking andthere was no public notice on the potential scope of such anauthorization. This issue should be deferred to the subsequentrulemaking on this subject. Dow commented that MSS shouldnot be addressed in the standard permit.

The commission has not changed the rule in response to thiscomment. The commission requires the authorization of MSSemissions for new pollution control projects. Authorizing MSSfor a replacement project when an initial authorization has notbeen made allows the MSS emissions to be included within theNSR permit without an effects evaluation. Because some pol-lution control projects can constitute facilities, the commissiondetermined that the authorization of MSS emissions within thestandard permit is necessary to an accurate review of projectemissions.

TIP, TexasGenco, Sempra, and AECT opposed the deletion ofthe provision in §116.617(5), which allows the recovery of lostcapacity caused by a derate resulting from the installation ofcontrol equipment or the implementation of a control technique.They stated that the language resulted from extensive input fromstakeholders during a previous rulemaking, and asked that thecommission provide a basis for its proposed removal. In addi-tion, EPA requested that the authorizations be identi�ed that arereferred to as "additional authorizations" in the proposed rule.TIP speci�cally requested that the standard permit continue toauthorize collateral increases if associated with the replacementof a control.

The commission agrees with the commenters and is retainingthe language authorizing the recovery and utilization of capacitylost due to a pollution control project. All production increases



associated with a pollution control project, not including capacityrecovered, must qualify for and be authorized under §116.110 or§116.116 prior to the use of the increased capacity. Additionalauthorization means a permit amendment under §116.110 or theuse of a permit by rule. The commission agrees that the standardpermit will continue to authorize collateral increases associatedwith control replacement.

EPA asked how the commission would address a situation un-der subsection (d)(1)(B) - (D) where it is determined a pollu-tion control project results in a control strategy violation or in-terferes with an NAAQS after construction has begun. It askedfor a demonstration of how the provisions of subparagraphs (B)- (D) meet the requirements of 40 CFR §51.160(a) and (b). EPAquestioned whether a pollution control project could begin oper-ation prior to the commission completing an evaluation under 40CFR §51.160(a) and how the commission would prevent con-struction of a project. It stated that the subparagraph is not clearthat construction of the pollution control project is solely at therisk of the owner if the commission does not �nd the projectmeets 40 CFR §51.160(a). EPA had similar comments concern-ing §116.617(f)(1)(A).

Because netting is required to show that a project does not trig-ger PSD or nonattainment reviews, the application of 40 CFR§51.160(a) should not be necessary. If a project is not con-structed as represented, the commission has the authority totake enforcement action if any standard permit conditions are vi-olated. The commission notes that it is always the responsibilityof the owner or operator to evaluate applicability and determinecompliance with all federal and state rules and regulations.

AECT recommended that the term "registration application" in§116.617(d)(1) be replaced by "registration" since no applicationis required under the standard permit process.

The commission agrees with the comment and made the neces-sary substitution. The commission further notes that evaluationof the proposed project requires the submittal of appropriate doc-umentation.

TIP and AECT commented that the proposed language in§116.617(d)(1)(B) requiring noti�cation of changes causingemission increases be submitted 30 days prior to constructionshould be deleted. They stated that the commission has notprovided justi�cation for the proposed change and that it iscontrary to the streamlining intent of NSR reform.

The commission is not changing the rule in response to thesecomments. Those changes, which include revisions to construc-tion and increased emissions, should be reported 30 days priorto implementation to allow time for review and approval of therevised project.

SUBCHAPTER A. DEFINITIONS30 TAC §116.12

STATUTORY AUTHORITY

The amendment is adopted under TWC, §5.103, concerningRules, and §5.105, concerning General Policy, which authorizethe commission to adopt rules necessary to carry out its pow-ers and duties under the TWC; and under THSC, §382.017,concerning Rules, which authorizes the commission to adoptrules consistent with the policy and purposes of the TCAA.The amendment is also adopted under THSC, §382.002, con-cerning Policy and Purpose, which establishes the commission

purpose to safeguard the state’s air resources, consistent withthe protection of public health, general welfare, and physicalproperty; §382.011, concerning General Powers and Duties,which authorizes the commission to control the quality of thestate’s air; §382.012, concerning State Air Control Plan, whichauthorizes the commission to prepare and develop a general,comprehensive plan for the control of the state’s air; §382.051,concerning Permitting Authority of Commission; Rules, whichauthorizes the commission to issue permits and adopt rulesnecessary for permits issued under THSC, Chapter 382;§382.0512, concerning Modi�cation of Existing Facility, whichestablishes a modi�cation and its limits; §382.0518, concerningPreconstruction Permit, which requires that a permit be obtainedfrom the commission prior to new construction or modi�cation ofan existing facility; and Federal Clean Air Act (FCAA), 42 UnitedStates Code (USC), §§7401 et seq., which requires permits forconstruction and operation of new or modi�ed major stationarysources.

The amendment implements THSC, §§382.002, 382.011,382.012, 382.051, 382.0512, and 382.0518; and FCAA, 42USC, §§7401 et seq.

§116.12. Nonattainment and Prevention of Signi�cant DeteriorationReview De�nitions.

Unless speci�cally de�ned in the Texas Clean Air Act (TCAA) or inthe rules of the commission, the terms used by the commission havethe meanings commonly ascribed to them in the �eld of air pollutioncontrol. The terms in this section are applicable to permit review formajor source construction and major source modi�cation in nonattain-ment areas. In addition to the terms that are de�ned by the TCAA, andin §101.1 of this title (relating to De�nitions), the following words andterms, when used in Chapter 116, Subchapter B, Divisions 5 and 6 ofthis title (relating to Nonattainment Review and Prevention of Signi�-cant Deterioration Review); and Chapter 116, Subchapter C, Division1 of this title (relating to Plant-Wide Applicability Limits), have thefollowing meanings, unless the context clearly indicates otherwise.

(1) Actual emissions--Actual emissions as of a particulardate are equal to the average rate, in tons per year, at which the unitactually emitted the pollutant during the 24-month period that pre-cedes the particular date and that is representative of normal sourceoperation, except that this de�nition shall not apply for calculatingwhether a signi�cant emissions increase has occurred, or for establish-ing a plant-wide applicability limit. Instead, paragraph (3) of this sec-tion relating to baseline actual emissions shall apply for this purpose.The executive director shall allow the use of a different time periodupon a determination that it is more representative of normal sourceoperation. Actual emissions shall be calculated using the unit’s actualoperating hours, production rates, and types of materials processed,stored, or combusted during the selected time period. The executivedirector may presume that the source-speci�c allowable emissions forthe unit are equivalent to the actual emissions, e.g., when the allowablelimit is re�ective of actual emissions. For any emissions unit that hasnot begun normal operations on the particular date, actual emissionsshall equal the potential to emit of the unit on that date.

(2) Allowable emissions--The emissions rate of a station-ary source, calculated using the maximum rated capacity of the source(unless the source is subject to federally enforceable limits that restrictthe operating rate, or hours of operation, or both), and the most strin-gent of the following:

(A) the applicable standards speci�ed in 40 Code ofFederal Regulations Part 60 or 61;



(B) the applicable state implementation plan emissionslimitation including those with a future compliance date; or

(C) the emissions rate speci�ed as a federally enforce-able permit condition including those with a future compliance date.

(3) Baseline actual emissions--The rate of emissions, intons per year, of a federally regulated new source review pollutant.

(A) For any existing electric utility steam generatingunit, baseline actual emissions means the rate, in tons per year, at whichthe unit actually emitted the pollutant during any consecutive 24-monthperiod selected by the owner or operator within the �ve-year periodimmediately preceding when the owner or operator begins actual con-struction of the project. The executive director shall allow the use ofa different time period upon a determination that it is more representa-tive of normal source operation.

(B) For an existing facility (other than an electric util-ity steam generating unit), baseline actual emissions means the rate, intons per year, at which the facility actually emitted the pollutant duringany consecutive 24-month period selected by the owner or operatorwithin the ten-year period immediately preceding either the date theowner or operator begins actual construction of the project, or the datea complete permit application is received for a permit. The rate shallbe adjusted downward to exclude any emissions that would have ex-ceeded an emission limitation with which the major stationary sourcemust currently comply with the exception of those required under 40Code of Federal Regulations Part 63, had such major stationary sourcebeen required to comply with such limitations during the consecutive24-month period.

(C) For a new facility, the baseline actual emissions forpurposes of determining the emissions increase that will result from theinitial construction and operation of such unit shall equal zero; and forall other purposes during the �rst two years following initial operation,shall equal the unit’s potential to emit.

(D) The actual rate shall be adjusted downward to ex-clude any non-compliant emissions that occurred during the consec-utive 24-month period. For each regulated new source review pol-lutant, when a project involves multiple facilities, only one consecu-tive 24-month period must be used to determine the baseline actualemissions for the facilities being changed. A different consecutive24-month period can be used for each regulated new source reviewpollutant. The rate shall not be based on any consecutive 24-month pe-riod for which there is inadequate information for determining annualemissions, in tons per year, and for adjusting this amount. Baselineemissions cannot occur prior to November 15, 1990.

(E) The actual emissions rate shall include fugitiveemissions to the extent quanti�able. Until March 1, 2016, emissionspreviously demonstrated as emissions events or historically exemptedunder Chapter 101 of this title (relating to General Air Quality Rules)may be included to the extent that they have been authorized, or arebeing authorized.

(4) Basic design parameters--For a process unit at a steamelectric generating facility, the owner or operator may select as its ba-sic design parameters either maximum hourly heat input and maximumhourly fuel consumption rate or maximum hourly electric output rateand maximum steam �ow rate. When establishing fuel consumptionspeci�cations in terms of weight or volume, the minimum fuel qualitybased on British thermal units content shall be used for determining thebasic design parameters for a coal-�red electric utility steam generat-ing unit. The basic design parameters for any process unit that is notat a steam electric generating facility are maximum rate of fuel or heatinput, maximum rate of material input, or maximum rate of product

output. Combustion process units will typically use maximum rate offuel input. For sources having multiple end products and raw materials,the owner or operator shall consider the primary product or primary rawmaterial when selecting a basic design parameter. The owner or opera-tor may propose an alternative basic design parameter for the source’sprocess units to the executive director if the owner or operator believesthe basic design parameter as de�ned in this paragraph is not appro-priate for a speci�c industry or type of process unit. If the executivedirector approves of the use of an alternative basic design parameter,that basic design parameter shall be identi�ed and compliance requiredin a condition in a permit that is legally enforceable.

(A) The owner or operator shall use credible informa-tion, such as results of historic maximum capability tests, design infor-mation from the manufacturer, or engineering calculations, in estab-lishing the magnitude of the basic design parameter.

(B) If design information is not available for a processunit, the owner or operator shall determine the process unit’s basic de-sign parameter(s) using the maximum value achieved by the processunit in the �ve-year period immediately preceding the planned activ-ity.

(C) Ef�ciency of a process unit is not a basic designparameter.

(5) Begin actual construction--In general, initiation ofphysical on-site construction activities on an emissions unit that areof a permanent nature. Such activities include, but are not limitedto, installation of building supports and foundations, laying of under-ground pipework, and construction of permanent storage structures.With respect to a change in method of operation, this term refers tothose on-site activities other than preparatory activities that mark theinitiation of the change.

(6) Building, structure, facility, or installation--All of thepollutant-emitting activities that belong to the same industrial group-ing, are located in one or more contiguous or adjacent properties, andare under the control of the same person (or persons under commoncontrol). Pollutant-emitting activities are considered to be part of thesame industrial grouping if they belong to the same "major group" (i.e.,that have the same two-digit code) as described in the Standard Indus-trial Classi�cation Manual, 1972, as amended by the 1977 supplement.

(7) Clean coal technology--Any technology, includingtechnologies applied at the precombustion, combustion, or post-com-bustion stage, at a new or existing facility that will achieve signi�cantreductions in air emissions of sulfur dioxide or oxides of nitrogenassociated with the utilization of coal in the generation of electricity,or process steam that was not in widespread use as of November 15,1990.

(8) Clean coal technology demonstration project--Aproject using funds appropriated under the heading "Department ofEnergy-Clean Coal Technology," up to a total amount of $2.5 billionfor commercial demonstration of clean coal technology, or similarprojects funded through appropriations for the United States Environ-mental Protection Agency. The federal contribution for a qualifyingproject shall be at least 20% of the total cost of the demonstrationproject.

(9) Commence--As applied to construction of a major sta-tionary source or major modi�cation, means that the owner or operatorhas all necessary preconstruction approvals or permits and either has:

(A) begun, or caused to begin, a continuous programof actual on-site construction of the source, to be completed within areasonable time; or



(B) entered into binding agreements or contractual obli-gations, which cannot be canceled or modi�ed without substantial lossto the owner or operator, to undertake a program of actual constructionof the source to be completed within a reasonable time.

(10) Construction--Any physical change or change in themethod of operation (including fabrication, erection, installation, de-molition, or modi�cation of an emissions unit) that would result in achange in actual emissions.

(11) Contemporaneous period--For major sources the pe-riod between:

(A) the date that the increase from the particular changeoccurs; and

(B) 60 months prior to the date that construction on theparticular change commences.

(12) De minimis threshold test (netting)--A method of de-termining if a proposed emission increase will trigger nonattainmentor prevention of signi�cant deterioration review. The summation ofthe proposed project emission increase in tons per year with all othercreditable source emission increases and decreases during the contem-poraneous period is compared to the signi�cant level for that pollutant.If the signi�cant level is exceeded, then prevention of signi�cant dete-rioration and/or nonattainment review is required.

(13) Electric utility steam generating unit--Any steam elec-tric generating unit that is constructed for the purpose of supplyingmore than one-third of its potential electric output capacity and morethan 25 megawatts electrical output to any utility power distributionsystem for sale. Any steam supplied to a steam distribution system forthe purpose of providing steam to a steam-electric generator that wouldproduce electrical energy for sale is included in determining the elec-trical energy output capacity of the affected facility.

(14) Federally regulated new source review pollutant--Asde�ned in subparagraphs (A) - (D) of this paragraph:

(A) any pollutant for which a national ambient air qual-ity standard has been promulgated and any constituents or precursorsfor such pollutants identi�ed by the United States Environmental Pro-tection Agency;

(B) any pollutant that is subject to any standard promul-gated under Federal Clean Air Act (FCAA), §111;

(C) any Class I or II substance subject to a standard pro-mulgated under or established by FCAA, Title VI; or

(D) any pollutant that otherwise is subject to regulationunder the FCAA; except that any or all hazardous air pollutants eitherlisted in FCAA, §112 or added to the list under FCAA, §112(b)(2),which have not been delisted under FCAA, §112(b)(3), are not regu-lated new source review pollutants unless the listed hazardous air pollu-tant is also regulated as a constituent or precursor of a general pollutantlisted under FCAA, §108.

(15) Lowest achievable emission rate--For any emitting fa-cility, that rate of emissions of a contaminant that does not exceed theamount allowable under applicable new source performance standardspromulgated by the United States Environmental Protection Agencyunder 42 United States Code, §7411, and that re�ects the following:

(A) the most stringent emission limitation that is con-tained in the rules and regulations of any approved state implementa-tion plan for a speci�c class or category of facility, unless the owner oroperator of the proposed facility demonstrates that such limitations arenot achievable; or

(B) the most stringent emission limitation that isachieved in practice by a speci�c class or category of facilities,whichever is more stringent.

(16) Major facility--Any facility that emits or has the po-tential to emit 100 tons per year or more of the plant-wide applicabilitylimit (PAL) pollutant in an attainment area; or any facility that emits orhas the potential to emit the PAL pollutant in an amount that is equalto or greater than the major source threshold for the PAL pollutant inTable I of this section for nonattainment areas.

(17) Major stationary source--Any stationary source thatemits, or has the potential to emit, a threshold quantity of emissionsor more of any air contaminant (including volatile organic compounds(VOCs) for which a national ambient air quality standard has been is-sued. The major source thresholds are identi�ed in Table I of this sec-tion for nonattainment pollutants and the major source thresholds forprevention of signi�cant deterioration pollutants are identi�ed in 40Code of Federal Regulations (CFR) §51.166(b)(1). A source that emits,or has the potential to emit a federally regulated new source review pol-lutant at levels greater than those identi�ed in 40 CFR §51.166(b)(1)is considered major for all prevention of signi�cant deterioration pol-lutants. A major stationary source that is major for VOCs or nitrogenoxides is considered to be major for ozone. The fugitive emissions ofa stationary source shall not be included in determining for any of thepurposes of this de�nition whether it is a major stationary source, un-less the source belongs to one of the categories of stationary sourceslisted in 40 CFR §51.165(a)(1)(iv)(C).

(18) Major modi�cation--As follows.

(A) Any physical change in, or change in the method ofoperation of a major stationary source that causes a signi�cant projectemissions increase and a signi�cant net emissions increase for any fed-erally regulated new source review pollutant. At a stationary sourcethat is not major prior to the increase, the increase by itself must equalor exceed that speci�ed for a major source . At an existing major sta-tionary source, the increase must equal or exceed that speci�ed for amajor modi�cation to be signi�cant. The major source and signi�cantthresholds are provided in Table I of this section for nonattainment pol-lutants. The major source and signi�cant thresholds for prevention ofsigni�cant deterioration pollutants are identi�ed in 40 Code of FederalRegulations §51.166(b)(1) and (23), respectively.Figure: 30 TAC §116.12(18)(A)

(B) A physical change or change in the method of op-eration shall not include:

(i) routine maintenance, repair, and replacement;

(ii) use of an alternative fuel or raw material by rea-son of an order under the Energy Supply and Environmental Coordina-tion Act of 1974, §2(a) and (b) (or any superseding legislation) or byreason of a natural gas curtailment plan under the Federal Power Act;

(iii) use of an alternative fuel by reason of an orderor rule of 42 United States Code, §7425;

(iv) use of an alternative fuel at a steam generatingunit to the extent that the fuel is generated from municipal solid waste;

(v) use of an alternative fuel or raw material by astationary source that the source was capable of accommodating beforeDecember 21, 1976 (unless such change would be prohibited under anyfederally enforceable permit condition established after December 21,1976) or the source is approved to use under any permit issued underregulations approved under this chapter;

(vi) an increase in the hours of operation or in theproduction rate (unless the change is prohibited under any federally



enforceable permit condition that was established after December 21,1976);

(vii) any change in ownership at a stationary source;

(viii) any change in emissions of a pollutant at a sitethat occurs under an existing plant-wide applicability limit;

(ix) the installation, operation, cessation, or removalof a temporary clean coal technology demonstration project, providedthat the project complies with the state implementation plan and otherrequirements necessary to attain and maintain the national ambient airquality standard during the project and after it is terminated;

(x) for prevention of signi�cant deterioration reviewonly, the installation or operation of a permanent clean coal technologydemonstration project that constitutes re-powering, provided that theproject does not result in an increase in the potential to emit of anyregulated pollutant emitted by the unit. This exemption shall apply ona pollutant-by-pollutant basis; or

(xi) for prevention of signi�cant deterioration re-view only, the reactivation of a clean coal-�red electric utility steamgenerating unit.

(19) Necessary preconstruction approvals or per-mits--Those permits or approvals required under federal air qualitycontrol laws and regulations and those air quality control laws andregulations that are part of the applicable state implementation plan.

(20) Net emissions increase--The amount by which thesum of the following exceeds zero: the project emissions increase plusany sourcewide creditable contemporaneous emission increases, mi-nus any sourcewide creditable contemporaneous emission decreases.Baseline actual emissions shall be used to determine emissions in-creases and decreases.

(A) An increase or decrease in emissions is creditableonly if the following conditions are met:

(i) it occurs during the contemporaneous period;

(ii) the executive director has not relied on it in issu-ing a federal new source review permit for the source and that permitis in effect when the increase in emissions from the particular changeoccurs; and

(iii) in the case of prevention of signi�cant deterio-ration review only, an increase or decrease in emissions of sulfur diox-ide, particulate matter, or nitrogen oxides that occurs before the appli-cable minor source baseline date is creditable only if it is required to beconsidered in calculating the amount of maximum allowable increasesremaining available.

(B) An increase in emissions is creditable if it is the re-sult of a physical change in, or change in the method of operation of astationary source only to the extent that the new level of emissions ex-ceeds the baseline actual emission rate. Emission increases at facilitiesunder a plant-wide applicability limit are not creditable.

(C) A decrease in emissions is creditable only to the ex-tent that all of the following conditions are met:

(i) the baseline actual emission rate exceeds the newlevel of emissions;

(ii) it is enforceable at and after the time that actualconstruction on the particular change begins;

(iii) the executive director has not relied on it in issu-ing a prevention of signi�cant deterioration or a nonattainment permit;

(iv) the decrease has approximately the same quali-tative signi�cance for public health and welfare as that attributed to theincrease from the particular change; and

(v) in the case of nonattainment applicability analy-sis only, the state has not relied on the decrease to demonstrate attain-ment or reasonable further progress.

(D) An increase that results from a physical change at asource occurs when the emissions unit on which construction occurredbecomes operational and begins to emit a particular pollutant. Anyreplacement unit that requires shakedown becomes operational onlyafter a reasonable shakedown period, not to exceed 180 days.

(21) Offset ratio--For the purpose of satisfying theemissions offset reduction requirements of 42 United States Code,§7503(a)(1)(A), the emissions offset ratio is the ratio of total actualreductions of emissions to total emissions increases of such pollutants.The minimum offset ratios are included in Table I of this section underthe de�nition of major modi�cation. In order for a reduction to qualifyas an offset, it must be certi�ed as an emission credit under Chapter101, Subchapter H, Division 1 or 4 of this title (relating to EmissionCredit Banking or Trading; or Discrete Emission Credit Banking andTrading), except as provided for in §116.170(b) of this title (relating toApplicability of Emission Reductions as Offsets). The reduction mustnot have been relied on in the issuance of a previous nonattainment orprevention of signi�cant deterioration permit.

(22) Plant-wide applicability limit--An emission limitationexpressed, in tons per year, for a pollutant at a major stationary source,that is enforceable and established in a plant-wide applicability limitpermit under §116.186 of this title (relating to General and Special Con-ditions).

(23) Plant-wide applicability limit effective date--The dateof issuance of the plant-wide applicability limit permit. The plant-wideapplicability limit effective date for a plant-wide applicability limit es-tablished in an existing �exible permit is the date that the �exible permitwas issued.

(24) Plant-wide applicability limit major modi�ca-tion--Any physical change in, or change in the method of operationof the plant-wide applicability limit source that causes it to emit theplant-wide applicability limit pollutant at a level equal to or greaterthan the plant-wide applicability limit.

(25) Plant-wide applicability limit permit--The new sourcereview permit that establishes the plant- wide applicability limit.

(26) Plant-wide applicability limit pollutant--The pollutantfor which a plant-wide applicability limit is established at a major sta-tionary source.

(27) Potential to emit--The maximum capacity of a station-ary source to emit a pollutant under its physical and operational design.Any physical or enforceable operational limitation on the capacity ofthe stationary source to emit a pollutant, including air pollution con-trol equipment and restrictions on hours of operation or on the type oramount of material combusted, stored, or processed, may be treated aspart of its design only if the limitation or the effect it would have onemissions is federally enforceable. Secondary emissions, as de�nedin 40 Code of Federal Regulations §51.165(a)(1)(viii), do not count indetermining the potential to emit for a stationary source.

(28) Project net--The sum of the following: the projectemissions increase, minus any sourcewide creditable emission de-creases proposed at the source between the date of application forthe modi�cation and the date the resultant modi�cation begins emit-ting. Baseline actual emissions shall be used to determine emissions



increases and decreases. Increases and decreases must meet the cred-itability criteria listed under the de�nition of net emissions increase inthis section.

(29) Projected actual emissions--The maximum annualrate, in tons per year, at which an existing facility is projected toemit a federally regulated new source review pollutant in any rolling12-month period during the �ve years following the date the facilityresumes regular operation after the project, or in any one of the tenyears following that date, if the project involves increasing the facil-ity’s design capacity or its potential to emit that federally regulatednew source review pollutant. In determining the projected actualemissions, the owner or operator of the major stationary source shallinclude fugitive emissions to the extent quanti�able and shall considerall relevant information, including, but not limited to, historicaloperational data, the company’s own representations, the company’sexpected business activity and the company’s highest projectionsof business activity, the company’s �lings with the state or federalregulatory authorities, and compliance plans under the approved stateimplementation plan.

(30) Project emissions increase--The sum of emissions in-creases for each modi�ed or affected facility determined using the fol-lowing methods:

(A) for existing facilities, the difference between theprojected actual emissions and the baseline actual emissions. In cal-culating any increase in emissions that results from the project, thatportion of the facility’s emissions following the project that the facil-ity could have accommodated during the consecutive 24-month periodused to establish the baseline actual emissions and that are also unre-lated to the particular project, including any increased utilization dueto product demand growth may be excluded from the project emissionincrease. The potential to emit from the facility following completionof the project may be used in lieu of the projected actual emission rate;and

(B) for new facilities, the difference between the poten-tial to emit from the facility following completion of the project andthe baseline actual emissions.

(31) Replacement facility--A facility that satis�es the fol-lowing criteria:

(A) the facility is a reconstructed unit within the mean-ing of 40 Code of Federal Regulations §60.15(b)(1), or the facility re-places an existing facility;

(B) the facility is identical to or functionally equivalentto the replaced facility;

(C) the replacement does not alter the basic design pa-rameters of the process unit;

(D) the replaced facility is permanently removed fromthe major stationary source, otherwise permanently disabled, or per-manently barred from operation by a permit that is enforceable. If thereplaced facility is brought back into operation, it shall constitute anew facility. No creditable emission reductions shall be generated fromshutting down the existing facility that is replaced. A replacement fa-cility is considered an existing facility for the purpose of determiningfederal new source review applicability.

(32) Secondary emissions--Emissions that would occur asa result of the construction or operation of a major stationary sourceor major modi�cation, but do not come from the source or modi�ca-tion itself. Secondary emissions must be speci�c, well-de�ned, quan-ti�able, and impact the same general area as the stationary source ormodi�cation that causes the secondary emissions. Secondary emis-

sions include emissions from any off-site support facility that wouldnot be constructed or increase its emissions, except as a result of theconstruction or operation of the major stationary source or major mod-i�cation. Secondary emissions do not include any emissions that comedirectly from a mobile source such as emissions from the tail pipe of amotor vehicle, from a train, or from a vessel.

(33) Signi�cant facility--A facility that emits or has the po-tential to emit a plant-wide applicability limit (PAL) pollutant in anamount that is equal to or greater than the signi�cant level for that PALpollutant.

(34) Small facility--A facility that emits or has the potentialto emit the plant-wide applicability limit (PAL) pollutant in an amountless than the signi�cant level for that PAL pollutant.

(35) Stationary source--Any building, structure, facility, orinstallation that emits or may emit any air pollutant subject to regulationunder 42 United States Code, §§7401 et seq.

(36) Temporary clean coal technology demonstrationproject--A clean coal technology demonstration project that is oper-ated for a period of �ve years or less, and that complies with the stateimplementation plan and other requirements necessary to attain andmaintain the national ambient air quality standards during the projectand after it is terminated.



2006.

TRD-200600192Stephanie Bergeron PerdueActing Deputy Director, Of¿ce of Legal ServicesTexas Commission on Environmental QualityEffective date: February 1, 2006Proposal publication date: September 30, 2005For further information, please call: (512) 239-5017

SUBCHAPTER B. NEW SOURCE REVIEWPERMITSDIVISION 1. PERMIT APPLICATION30 TAC §116.121

STATUTORY AUTHORITY

The new section is adopted under TWC, §5.103, concerningRules, and §5.105, concerning General Policy, which authorizethe commission to adopt rules necessary to carry out its pow-ers and duties under the TWC; and under THSC, §382.017,concerning Rules, which authorizes the commission to adoptrules consistent with the policy and purposes of the TCAA. Thenew section is also adopted under THSC, §382.002, concern-ing Policy and Purpose, which establishes the commission pur-pose to safeguard the state’s air resources, consistent with theprotection of public health, general welfare, and physical prop-erty; §382.011, concerning General Powers and Duties, whichauthorizes the commission to control the quality of the state’s air;§382.012, concerning State Air Control Plan, which authorizesthe commission to prepare and develop a general, comprehen-sive plan for the control of the state’s air; §382.051, concerning



§ 116.617. State Pollution Control Project Standard Permit, 30 TX ADC § 116.617

© 2012 Thomson Reuters. No claim to original U.S. Government Works. 1

Texas Administrative CodeTitle 30. Environmental Quality

Part 1. Texas Commission on Environmental QualityChapter 116. Control of Air Pollution by Permits for New Construction or Modification

Subchapter F. Standard Permits

30 TAC § 116.617Tex. Admin. Code tit. 30, § 116.617

§ 116.617. State Pollution Control Project Standard Permit

Currentness

(a) Scope and applicability.

(1) This standard permit applies to pollution control projects undertaken voluntarily or as required by any governmentalstandard, that reduce or maintain currently authorized emission rates for facilities authorized by a permit, standard permit,or permit by rule.

(2) The project may include:

(A) the installation or replacement of emissions control equipment;

(B) the implementation or change to control techniques; or

(C) the substitution of compounds used in manufacturing processes.

(3) This standard permit must not be used to authorize the installation of emission control equipment or the implementationof a control technique that:

(A) constitutes the complete replacement of an existing production facility or reconstruction of a production facilityas defined in 40 Code of Federal Regulations § 60.15(b)(1) and (c); or

(B) the executive director determines there are health effects concerns or the potential to exceed a national ambientair quality standard criteria pollutant or contaminant that results from an increase in emissions of any air contaminantuntil those concerns are addressed by the registrant to the satisfaction of the executive director; or

(C) returns a facility or group of facilities to compliance with an existing authorization or permit unless authorizedby the executive director.

(4) Prior to March 3, 2011, new or modified pollution control projects must meet the conditions of this standard permit. Allprevious standard permit registrations under this section that were authorized prior to the effective date of this rule mustinclude the increases and decreases in emissions resulting from those projects in any future netting calculation and all otherconditions must be met upon the ten-year anniversary and renewal of the original registration, or until administrativelyincorporated into the facilities' permit, if applicable.

(5) Notwithstanding the requirements of § 116.604 of this title (relating to Duration and Renewal of Registrations to UseStandard Permits), on or after March 3, 2011, no new or modified registrations will be accepted and no existing registrationswill be renewed.

(b) General requirements.

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(1) Any claim under this standard permit must comply with all applicable conditions of:

(A) § 116.604(1) and (2) of this title (relating to Duration and Renewal of Registrations to Use Standard Permits);

(B) § 116.605(d)(1) and (2) of this title (relating to Standard Permit Amendment and Revocation);

(C) § 116.610 of this title (relating to Applicability);

(D) § 116.611 of this title (relating to Registration to Use a Standard Permit);

(E) § 116.614 of this title (relating to Standard Permit Fees); and

(F) § 116.615 of this title (relating to General Conditions).

(2) Construction or implementation of the pollution control project must begin within 18 months of receiving writtenacceptance of the registration from the executive director, with one 18-month extension available, and must comply with §116.115(b)(2) and § 116.120 of this title (relating to General and Special Conditions and Voiding of Permits). Any changesto allowable emission rates authorized by this section become effective when the project is complete and operation orimplementation begins.

(3) The emissions limitations of § 116.610(a)(1) of this title do not apply to this standard permit.

(4) Predictable maintenance, startup, and shutdown emissions directly associated with the pollution control projects mustbe included in the representations of the registration application.

(5) Any increases in actual or allowable emission rates or any increase in production capacity authorized by this section(including increases associated with recovering lost production capacity) must occur solely as a result of the project asrepresented in the registration application. Any increases of production associated with a pollution control project mustnot be utilized until an additional authorization is obtained. This paragraph is not intended to limit the owner or operator'sability to recover lost capacity caused by a derate, which may be recovered and used without any additional authorization.

(c) Replacement projects.

(1) The replacement of emissions control equipment or control technique under this standard permit is not limited to themethod of control currently in place, provided that the control or technique is at least as effective as the current authorizedmethod and all other requirements of this standard permit are met.

(2) The maintenance, startup, and shutdown emissions may be increased above currently authorized levels if the increaseis necessary to implement the replacement project and maintenance, startup, and shutdown emissions were authorized forthe existing control equipment or technique.

(3) Equipment installed under this section is subject to all applicable testing and recordkeeping requirements of the originalcontrol authorization. Alternate, equivalent monitoring, or records may be proposed by the applicant for review andapproval of the executive director.

(d) Registration requirements.

(1) A registration must be submitted in accordance with the following.

(A) If there are no increases in authorized emissions of any air contaminant resulting from a replacement pollutioncontrol project, a registration must be submitted no later than 30 days after construction or implementation beginsand the registration must be accompanied by a $900 fee.

Add. 80




(B) If a new control device or technique is authorized or if there are increases in authorized emissions of any aircontaminant resulting from the pollution control project, a registration must be submitted no later than 30 days prior toconstruction or implementation. The registration must be accompanied by a $900 fee. Construction or implementationmay begin only after:

(i) no written response has been received from the executive director within 30 calendar days of receipt by theTexas Commission on Environmental Quality (TCEQ); or

(ii) written acceptance of the pollution control project has been issued by the executive director.

(C) If there are any changes in representations to a previously authorized pollution control project standard permit forwhich there are no increases in authorized emissions of any air contaminant, a notification or letter must be submittedno later than 30 days after construction or implementation of the change begins. No fee applies and no response willbe sent from the executive director.

(D) If there are any changes in representations to a previously authorized pollution control project standard permit thatalso increase authorized emissions of any air contaminant resulting from the pollution control project, a registrationalteration must be submitted no later than 30 days prior to the start of construction or implementation of the change.The registration must be accompanied by a $450 fee, unless received within 180 days of the original registrationapproval. Construction or implementation may begin only after:

(i) no written response has been received from the executive director within 30 calendar days of receipt by theTCEQ; or

(ii) written acceptance of the pollution control project has been issued by the executive director.

(2) The registration must include the following:

(A) a description of process units affected by the project;

(B) a description of the project;

(C) identification of existing permits or registrations affected by the project;

(D) quantification and basis of increases and/or decreases associated with the project, including identification ofaffected existing or proposed emission points, all air contaminants, and hourly and annual emissions rates;

(E) a description of proposed monitoring and recordkeeping that will demonstrate that the project decreases ormaintains emission rates as represented; and

(F) a description of how the standard permit will be administratively incorporated into the existing permit(s).

(e) Operational requirements. Upon installation of the pollution control project, the owner or operator shall comply with therequirements of paragraphs (1) and (2) of this subsection.

(1) General duty. The owner or operator must operate the pollution control project in a manner consistent with goodindustry and engineering practices and in such a way as to minimize emissions of collateral pollutants, within the physicalconfiguration and operational standards usually associated with the emissions control device, strategy, or technique.

(2) Recordkeeping. The owner or operator must maintain copies on site of monitoring or other emission records to provethat the pollution control project is operated consistent with the requirements in paragraph (1) of this subsection, and theconditions of this standard permit.

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(f) Incorporation of the standard permit into the facility authorization.

(1) Any new facilities or changes in method of control or technique authorized by this standard permit instead of a permitamendment under § 116.110 of this title (relating to Applicability) at a previously permitted or standard permitted facilitymust be incorporated into that facility's permit when the permit is amended or renewed.

(2) All increases in previously authorized emissions, new facilities, or changes in method of control or technique authorizedby this standard permit for facilities previously authorized by a permit by rule must comply with § 106.4 of this title(relating to Requirements for Permitting by Rule), except § 106.4(a)(1) of this title, and § 106.8 of this title (relating toRecordkeeping).

CreditsSource: The provisions of this §116.617 adopted to be effective February 1, 2006, 31 TexReg 515; amended to be effectiveMarch 3, 2011, 36 TexReg 1305.

Current through June 30, 2012

30 TAC § 116.617, 30 TX ADC § 116.617

End of Document © 2012 Thomson Reuters. No claim to original U.S. Government Works.

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§ 116.911. Electric Generating Facility Permit Application, 30 TX ADC § 116.911


Texas Administrative CodeTitle 30. Environmental Quality

Part 1. Texas Commission on Environmental QualityChapter 116. Control of Air Pollution by Permits for New Construction or Modification

Subchapter I. Electric Generating Facility Permits

30 TAC § 116.911Tex. Admin. Code tit. 30, § 116.911

§ 116.911. Electric Generating Facility Permit Application

Currentness

(a) Owners or operators of grandfathered or electing electric generating facilities (EGF) shall submit an application to authorizenitrogen oxides (NOx) emissions and, if applicable, sulfur dioxide (SO2) and particulate matter (PM) emissions. The application

must include a completed Form PI-1-U, General Application. The Form PI-1-U must be signed by an authorized representativeof the applicant. The Form PI-1-U specifies additional support information which must be provided before the application isdeemed complete. In order to be granted an electric generating facility permit (EGFP), the owner or operator shall submitinformation to the commission which demonstrates that all of the following are met.

(1) Measurement of emissions and performance demonstration. Applicants must propose monitoring and reporting for themeasurement of emissions and demonstration of performance consistent with § 116.914 of this title (relating to EmissionsMonitoring and Reporting Requirements).

(2) Control method. New control methods proposed in initial applications must comply with the requirements in §116.617(1), (3), (4)(A), and (B) and (5)-(9) of this title (relating to Standard Permit for Pollution Control Projects).

(3) Air dispersion modeling or ambient monitoring for pollution control projects. Computerized air dispersion modelingand/or ambient monitoring may be required by the commission's Air Permits Division where there is an increase inemissions to determine the air quality impacts from controls proposed under paragraph (2) of this subsection.

(4) Opacity limitations for coal-fired grandfathered and electing EGFs. The coal-fired grandfathered and electing EGFsmust meet the opacity limitations of § 111.111 of this title (relating to Requirements for Specified Sources).

(b) Application information for electing EGFs.

(1) In addition to the information required in this section, EGFP applications regarding electing EGFs shall contain thefollowing information:

(A) documentation of the emissions from the 1997 Emissions Scorecard from the EPA Acid Rain Program, or if thatinformation is not available, the actual emissions from that electing EGF for calendar year 1997;

(B) documentation of fuel consumption, fuel heating values, and heat input in millions of British thermal units(MMBtu) for calendar year 1997;

(C) identification of the electing EGFs to be included.

(2) Emissions of air contaminants from electing EGFs other than NOx, and if applicable, SO 2 and PM, already authorized

by Chapter 116 of this title (relating to Control of Air Pollution by Permits for New Construction or Modification), willnot be authorized under this subchapter.

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§ 116.911. Electric Generating Facility Permit Application, 30 TX ADC § 116.911


(c) The owner or operator of a grandfathered or electing EGF must submit an application for a permit under this subchapteron or before September 1, 2000.

(d) Any grandfathered natural gas-fired EGF for which a permit application was filed under subsection (a) of this section, orfor which a permit has been obtained in accordance with subsection (a) of this section, or which is excluded in accordance with§ 116.910(d) of this title (relating to Applicability) from the requirement to submit an application under subsection (a) of thissection is considered permitted for the emissions of all air contaminants from that EGF.

(e) An owner or operator of a grandfathered coal-fired EGF with a permit issued in accordance with subsection (a) of thissection or with an application pending under subsection (a) of this section may submit an application for an EGFP in accordancewith to § 116.917 of this title (relating to Electric Generating Facility Permit Application for Certain Grandfathered Coal-FiredElectric Generating Facilities and Certain Grandfathered Facilities Located at Electric Generating Facility Sites) to authorizethe emissions of all criteria pollutants from the EGF other than NO x, SO2, and PM as it relates to opacity.

(f) An owner or operator of a grandfathered or electing EGF with a permit application pending under subsection (a) of thissection or a permit issued in accordance with subsection (a) of this section may submit an application for an EGFP in accordancewith § 116.917 of this title to also authorize each of the following types of facilities that are located at the same site as the EGF:

(1) a generator that does not generate electric energy for compensation and is used not more than 10% of the normal annualoperating schedule; or

(2) an auxiliary fossil-fuel-fired combustion facility that does not generate electric energy and does not emit more than100 tons per year of any air contaminant.

(g) Any application submitted in accordance with § 116.917 of this title for facilities identified in subsection (e) of this sectionmust be submitted by September 1, 2003. Any application submitted in accordance with § 116.917 of this title for facilitiesidentified in subsection (f)(1) or (2) of this section must be submitted by September 1, 2002. Any additional controls specifiedin an EGF permit issued in accordance with an application filed under § 116.917 of this title are subject to the schedule outlinedin § 116.771 of this title (relating to Implementation Schedule for Additional Controls.)

(h) Emissions of air contaminants from facilities identified in subsection (f)(1) or (2) of this section must be included in eachapplicable emissions allowance trading program under Chapter 101, Subchapter H, Division 2 of this title (relating to EmissionsBanking and Trading Allowances). The commission will not issue any new emissions allowance for the emissions of any aircontaminant from such a facility.

(i) All applications for an EGFP shall be submitted under the seal of a Texas licensed professional engineer if required by §116.110(e) of this title (relating to Applicability).

CreditsSource: The provisions of this § 116.911 adopted to be effective January 11, 2000, 25 TexReg 185; amended to be effectiveJune 12, 2002, 27 TexReg 4954.

Current through June 30, 2012

30 TAC § 116.911, 30 TX ADC § 116.911


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§ 39.264. Emissions Reductions of “Grandfathered Facilities”, TX UTIL § 39.264


Vernon's Texas Statutes and Codes AnnotatedUtilities Code (Refs & Annos)

Title 2. Public Utility Regulatory ActSubtitle B. Electric Utilities (Refs & Annos)

Chapter 39. Restructuring of Electric Utility IndustrySubchapter F. Recovery of Stranded Costs through Competition Transition Charge

V.T.C.A., Utilities Code § 39.264

§ 39.264. Emissions Reductions of “Grandfathered Facilities”

Currentness

(a) In this section:

(1) “Conservation commission” means the Texas Natural Resource Conservation Commission.

(2) “Electric generating facility” means a facility that generates electric energy for compensation and is owned or operatedby a person in this state, including a municipal corporation, electric cooperative, or river authority.

(b) This section applies only to an electric generating facility existing on January 1, 1999, that is not subject to the requirementto obtain a permit under Section 382.0518(g), Health and Safety Code.

(c) It is the intent of the legislature that, for the 12-month period beginning on May 1, 2003, and for each 12-month period afterthe end of that period, total annual emissions of nitrogen oxides from facilities subject to this section may not exceed levelsequal to 50 percent of the total emissions of that pollutant during 1997, as reported to the conservation commission, and totalannual emissions of sulphur dioxides from coal-fired facilities subject to this section may not exceed levels equal to 75 percentof the total emissions of that pollutant during 1997, as reported to the conservation commission. The limitations prescribed bythis subsection may be met through an emissions allocation and allowance transfer system described by this section.

(d) A municipal corporation, electric cooperative, or river authority may exclude any electric generating facilities of 25megawatts or less from the requirements prescribed by this section. Not later than January 1, 2000, a municipal corporation,electric cooperative, or river authority must inform the conservation commission of its intent to exclude those facilities.

(e) The owner or operator of an electric generating facility shall apply to the conservation commission for a permit for theemission of air contaminants on or before September 1, 2000. A permit issued by the conservation commission under thissection shall require the facility to achieve emissions reductions or trading emissions allowances as provided by this section.If the facility uses coal as a fuel, the permit must also be conditioned on the facility's emissions meeting opacity limitationsprovided by conservation commission rules. Notwithstanding Section 382.0518(g), Health and Safety Code, a facility that doesnot obtain a permit as required by this subsection may not operate after May 1, 2003, unless the conservation commission findsgood cause for an extension.

(f) The conservation commission shall develop rules for the permitting of electric generating facilities. The rules adopted underthis subsection shall provide, by region, for the allocation of emissions allowances of sulphur dioxides and nitrogen oxidesamong electric generating facilities and for facilities to trade emissions allowances for those contaminants.

(g) The conservation commission by rule shall establish an East Texas Region, a West Texas Region, and an El Paso Regionfor allocation of air contaminants under the permitting program under Subsection (f). The East Texas Region must containall counties traversed by or east of Interstate Highway 35 or Interstate Highway 37, including Bosque, Coryell, Hood, Parker,

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Somervell, and Wise counties. The West Texas Region includes all of the state not contained in the East Texas Region or theEl Paso Region. The El Paso Region includes El Paso County.

(h) Not later than January 1, 2000, the conservation commission shall allocate to each electric generating facility in each regiona number of annual emissions allowances, with each allowance equal to one ton of sulphur dioxides or of nitrogen oxidesemitted in a year, that permit emissions of the contaminants from the facility in that year. The conservation commission mustallocate to each facility a number of emissions allowances equal to an emissions rate measured in pounds per million Britishthermal units divided by 2,000 and multiplied by the facility's total heat input in terms of million British thermal units during1997. For the East Texas Region, the emissions rate shall be 0.14 pounds per million British thermal units for nitrogen oxidesand 1.38 pounds per million British thermal units for sulphur dioxides. For the West Texas and El Paso regions, the emissionsrate shall be 0.195 pounds per million British thermal units for nitrogen oxides. Allowances for sulphur dioxides may only beallocated among coal-fired facilities.

(i) A person, municipal corporation, electric cooperative, or river authority that owns and operates an electric generating facilitynot covered by this section may elect to designate that facility to become subject to the requirements of this section and toreceive emissions allowances for the purpose of complying with the emissions limitations prescribed by Subsection (c). Theconservation commission shall adopt rules governing this election that:

(1) require an owner or operator of an electric generating facility to designate to the conservation commission in its permitapplication under Subsection (e) any facilities that will become subject to this section;

(2) require the conservation commission, notwithstanding the allocation mechanism provided by Subsection (h), to allocateadditional allowances to facilities governed by this subsection in an amount equal to each facility's actual emissions in tonsin 1997;

(3) provide that any unit designated under this subsection may not transfer or bank allowances conserved as a result of reducedutilization or shutdown, except that the allowances may be transferred or carried forward for use in subsequent years to theextent that the reduced utilization or shutdown results from the replacement of thermal energy from the unit designated underthis subsection with thermal energy generated by any other unit; and

(4) provide that emissions reductions from electing facilities designated in this subsection may only be used to satisfy theemissions reductions for grandfathered facilities defined in Subsection (c) to the extent that reductions used to satisfy thelimitations in Subsection (c) are beyond the requirements of any other state or federal standard, or both.

(j) The conservation commission by rule shall permit a facility to trade emissions allocations with other electric generatingfacilities only in the same region.

(k) The conservation commission by rule shall provide methods for the conservation commission to determine whether a facilitycomplies with the permit issued under this section. The rules must provide for:

(1) monitoring and reporting actual emissions of sulphur dioxides and nitrogen oxides from each facility;

(2) provisions for saving unused allowances for use in later years; and

(3) a system for tracking traded allowances.

(l) A facility may not trade an unused allowance for a contaminant for use as a credit for another contaminant.

(m) A person possessing market power shall not withhold emissions allowances from the market in a manner that is unreasonablydiscriminatory or tends to unreasonably restrict, impair, or reduce the level of competition.

(n) The conservation commission shall penalize a facility that emits an air contaminant that exceeds the facility's allowancesfor that contaminant by:

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(1) enforcing an administrative penalty, in an amount determined by conservation commission rules, for each ton of aircontaminant emissions by which the facility exceeds its allocated emissions allowances; and

(2) reducing the facility's emissions allowances for the next year by an amount of emissions equal to the excessive emissionsin the year the facility emitted the excessive air contaminants.

(o) The conservation commission may penalize a facility that emits an air contaminant that exceeds the facility's allowancesfor that contaminant by:

(1) ordering the facility to cease operations; or

(2) taking other enforcement action provided by conservation commission rules.

(p) The conservation commission by rule shall provide for a facility in the El Paso Region to meet emissions allowances byusing credits from emissions reductions achieved in Ciudad Juarez, United Mexican States.

(q) If the conservation commission or the United States Environmental Protection Agency determines that reductions in nitrogenoxides emissions in the El Paso Region otherwise required by this section would result in increased ambient ozone levels in ElPaso County, facilities in the El Paso Region are exempt from the nitrogen oxides reduction requirements.

(r) An applicant for a permit under Subsection (e) shall publish notice of intent to obtain the permit in accordance with Section382.056, Health and Safety Code. The conservation commission shall provide an opportunity for a public hearing and thesubmission of public comment and send notice of a decision on an application for a permit under Subsection (e) in the samemanner as provided by Sections 382.0561 and 382.0562, Health and Safety Code. The conservation commission shall reviewand renew a permit issued under this section in accordance with Section 382.055, Health and Safety Code.

(s) This section does not limit the authority of the conservation commission to require further reductions of nitrogen oxides,sulphur dioxides, or any other pollutant from generating facilities subject to this section or Section 39.263.

CreditsAdded by Acts 1999, 76th Leg., ch. 405, § 39, eff. Sept. 1, 1999.

V. T. C. A., Utilities Code § 39.264, TX UTIL § 39.264Current through the end of the 2011 Regular Session and First Called Session of the 82nd Legislature


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