DECISION TO IMPOSE NON-ATTAINMENT FEES DELAYED (AQMD RULE 317)

At the June 2009 meeting, the South Coast Air Quality Management District’s board decided to delay imposing fees under the proposed Rule 317 –– Clean Air Act Non-Attainment Fees. The regulation is in response to Section 185 of the Clean Air Act, which according to staff interpretation, is past due. The Sacramento District and the San Joaquin District have already taken action to implement this program.

The Clean Air Act requires that facilities located in areas of non-attainment, such as SCAQMD, pay additional fees of $5,000 per ton of pollutant, adjusted to CPI. The CPI adjustment translates into a fee of $9,000 per ton of pollutant. According to one industry representative, the fee for his company alone would be $110,000 per year. The District would send out bills for these fees starting in 2012, based on the emissions that occur in 2010.

Staff presented two options to the board:

Option A: Establishes an attainment year baseline for all existing sources;

Option B: Provides a voluntary alternative baseline for cyclical sources, where facilities would have to submit a plan to the District for the five prior years of operation, describing their five prior years’ emissions and accounting for any changes to those emissions that happened as a result of regulatory actions, whether state, federal or local. The District proposes the “T-test,” a statistical test to determine if the five-year average can be used as the alternative baseline.

Industry representatives objected to the rule, citing bad economic times. In response to some of requests from the business community, AQMD staff has expressed a willingness to allow the affected parties to invest their portion of the fees back within the fence line of the facility. Staff is open to that for any items that would be above and beyond regulations, since this would be mitigation funds that would be used to further improve air quality. Should there not be eligible projects inside the fence line of the facility, staff is supportive also of that facility asking the AQMD to help find projects in the community adjacent to the facility. AQMD staff would bring that back to the board before the end of this year as a part of the overall protocol.

At the core of the discussion were concerns regarding permitted units that already comply with Best Available Control Technology (BACT) requirements and that are unable to further reduce emissions. Board member Bill Campbell expressed concern about imposing fines to facilities at BACT levels and how it could be interpreted as punishing those facilities for doing what is right, as well as rewarding those who would choose to wait until the rule goes into effect before installing BACT. The EPA issued guidelines in 2008 that would allow a facility to look within their past ten years of operation and select the two highest consecutive emission years as a means of establishing a baseline.

Board members questioned whether or not there was a nexus between the fees collected and the potential emission reductions. Additionally, the adoption of the Rule without a specific expenditure plan was another reason cited by board members for delaying the proposal. The board voted to delay the hearing until June and at their June meeting decided to postpone the decision once more. Additionally, the board decided to direct staff to analyze the legality of the BACT exemption proposal and amendments with specific language for the following three concepts:

• Include BACT language similar to that implemented by San Joaquin Valley Air Pollution Control District;
• Omit option B and instead use the EPA guidelines of looking back 10 years and using the two highest consecutive years for emissions; and
• Prioritize use of revenue from Rule 317 fees such that first, funds would go to the permittee to introduce additional controls at the facility; Second, to be used in the local region of the permittee’s facility; Third, if there were funds left over after that, for the permittee to be able to use that in another permitted operation of theirs, somewhere else in the District. And fourth, any remaining funds to be utilized in a fashion proposed by staff to maximize improved air quality in the District.

CALIFORNIA ADOPTS NEW STANDARD FOR CAR WINDOWS

Effective in 2012, new cars sold in California will have to comply with a regulation promulgated by the California Air Resources Board (ARB), which requires car windows to block heat-producing rays from the sun. The initiative is part of the state’s AB32 legislation, which aims to reduce greenhouse gases.

According to the ARB, the requirement will keep cars cooler (14 degrees Fahrenheit for a car and 12 degrees Fahrenheit for a pickup or SUV). Reflecting heat from the windows is expected to result in less air conditioning and increased fuel efficiency, thereby reducing global warming pollutants. Other expected benefits to the consumer include a cooler interior upon entering the car, less time for the air conditioning to reach a comfortable temperature and reduced fading of upholstery and cracking of the dashboard.
ARB will implement the regulation in two phases. The first phase will take effect in 2012 and requires a 45 percent reduction in the amount of heat energy from the sun entering the car, with the windshield rejecting a minimum of 50 percent of the sun’s energy, over a three year period. The cost is estimated at $70 per car with an annual savings in gas of $16.
The second phase will take effect in 2016 and requires that car manufacturers install windows in new cars sold in California that prevent at least 60 percent of the sun’s heat-producing rays from entering the car’s interior, or propose alternative technologies to achieve an equivalent result. The cost is estimated at $250 for the windows with an annual savings in gas of $20.

Chemical additives in the glass during the manufacturing process would achieve the desired effect of reflecting the sun’s rays. Using laminated glass coated with invisible microscopic specks of reflective metal is another means of compliance. Visibility is not expected to be impacted by the requirements.

The measure is estimated to reduce 700,000 metric tons of carbon dioxide by 2020.

CHANGES PROPOSED FOR PLASTIC, RUBBER, LEATHER & GLASS COATINGS (SCAQMD RULE 1145)

The South Coast Air Quality Management District (SCAQMD) is proposing amendments to Rule 1145 —Plastic, Rubber, Leather and Glass Coatings— that mirror the requirements of the Environmental Protection Agency’s Control Techniques Guidelines and create some exemptions. There are approximately 115 facilities that fall under the purview of Rule 1145, involved in the following processes:

• Aerospace
• Automotive
• Electronic
• Medical Industries

Under the proposal, the VOC limit for the multi-colored category would be reduced from 685 gm/liter to 680 gm/liter. Based on a 260 days per year work schedule, AQMD staff calculated the theoretical VOC reduction to be approximately 104 lbs/year (0.4 lbs/day).

The proposed amendments would also add a new coating category to the Table of Standards in Rule 1145. Staff proposes to create and exempt a new coating category: refrigerated glass door coatings. The report states that “AQMD staff has determined that the facility has been unable to locate a VOC compliant coating that would perform to the expected performance standards the refrigerated doors must adhere to.” AQMD staff calculated these emissions to be approximately 540.5 lbs/year (2.1 lbs/day) of VOC foregone.

The combined total emissions for the proposed amendments to the multi-colored category and the addition of the refrigerated glass door coatings calculate to approximately 436.5 lbs/year (1.7 lbs/day) of VOC emissions foregone.

Additionally, paragraph (c)(3) in Rule 1145, related to automotive coatings, is being deleted. Staff has determined that the 2008 changes to Rule 1151–Motor Vehicle and Mobile Equipment Non-assembly Line Coating Operations– deem paragraph (c)(3) obsolete. Any associated parts or components that are not attached to a motor vehicle or mobile equipment but are designed to be a part of a motor vehicle or mobile equipment are now governed under Rule 1151.
The proposal is tentatively scheduled for public hearing and adoption by the AQMD board on September 11, 2009.

EXTENSION OF SELL-THROUGH DATES FOR COMPOSITE WOOD PRODUCTS

The California Air Resources Board (ARB) has issued an advisory for distributors and retailers of composite wood product panels manufactured before January 1, 2009. In April 2007, the California Air Resources Board approved an Airborne Toxics Control Measure (ATCM) to reduce formaldehyde emissions from composite wood products and from finished goods that contain composite wood products. The ATCM is contained in Title 17, California Code of Regulations, sections 93120-93120.12. Under the sell-through provisions, composite wood products and finished goods manufactured before each applicable effective date may legally be sold, supplied, or offered for sale in California for specified periods of time after the effective date. Such products and finished goods do not need to comply with labeling requirements specified in the ATCM. Products manufactured after an applicable effective date must meet the corresponding emission standard and they cannot take advantage of the sell-through period.

The agency has announced a four-month delay in the enforcement of the Phase 1 sell-through dates for distributors and retailers of composite wood product panels manufactured before January 1, 2009. These products include:

• Hardwood plywood with veneer core (HWPW-VC)
• Particleboard (PB)
• Medium density fiberboard (MDF)
• Thin medium density fiberboard

According to the advisory, manufacturers of these products are “currently producing ample quantities of panels that meet the Phase 1 standards in the California Air Resources Board’s (ARB’s) Composite Wood Products Regulation.” Citing the economic downturn, ARB reports that product sales have been much lower than expected and distributors and retailers of these products still have a significant amount of non-compliant inventory that was manufactured before January 1, 2009. Thus, a four-month enforcement grace period is being granted to allow additional time to sell these inventories. The advisory clarifies that:

“The four-month enforcement grace period means that ARB will not enforce the sell-through dates during the grace period for distributors and retailers of these products. ARB regulatory staff will not refer these products for penalties or take other enforcement action against distributors or retailers regarding these sell-through dates.”

Retailers may now sell non-complying composite wood panels until April 30, 2010 for HWPW-VC, PB and MDF. The sell-through period for HWPW-CC was not changed. Retailers may sell non-complying HWPW-CC until June 30, 2010.

FEDERAL GOVERNMENT TO PROMOTE SOLAR ENERGY DEVELOPMENT PROJECTS

The United States Department of Interior has announced incentives for solar energy development projects that would include funding of environmental studies, establishment of solar energy permitting offices and expedited review of industry proposals. According to the agency, there are approximately two dozen areas under evaluation that could generate nearly 100,000 megawatts of solar electricity.

The objective is to provide landscape-scale planning and zoning for solar projects in tracts administered by the Bureau of Land Management located in six western states. The areas would be analyzed for their environmental and resource suitability for large scale (10 or more megawatts of electricity) solar energy production. Project proposals in areas that are already approved for this type of development would be prioritized. Sensitive lands, wilderness and other high conservation value lands with conflicting issues would not be up for consideration.

The newly convened Interior renewable energy coordination offices (with locations in Nevada, Arizona, California and Wyoming) would be responsible for helping expedite processing of 470 renewable energy project applications received to date for projects on U.S. lands. 158 applications involve solar projects covering 1.8 million acres of land with a projected capacity to generate 97,000 megawatts of electricity.

In collaboration with the Department of Energy, the Solar Programmatic Environmental Impact Statement—an ongoing federal environmental evaluation of potential solar development on public lands—will be expanded to analyze the impacts of utility-scale solar projects. The funding for the expansion of the study will come from the American Recovery and Reinvestment Act (Stimulus bill).
The public will have the opportunity to comment on these proposed solar energy study areas during the environmental reviews before any final decisions are made. The evaluation is expected to be completed in late 2010.

CALIFORNIA GETS EPA APPROVAL FOR STRICTER CAR STANDARDS

The Clean Air Act grants California the authority to set stricter standards for vehicles than the federal government if the Environmental Protection Agency (EPA) issues a “waiver.” The EPA recently granted the waiver (requested in 2005) to California, allowing the state to move forward with tougher regulations. The move is expected to promote regulation development in other states that are expected to follow the precedent set in California.

GREENHOUSE GAS REDUCTIONS FROM LANDFILLS

The Air Resources Board has adopted a regulation to reduce 1.5 million metric tons of greenhouse gas emissions by capturing methane from landfills. The regulation impacts 14 uncontrolled municipal solid waste landfills in the state and requires the installation of gas collection and control systems, effective 2012. Existing facilities with already installed control systems would have to improve the efficiency of their devices. ARB estimates that 218 of the state’s overall 367 municipal solid waste landfills with the potential to generate methane emissions may be subject to the regulation.

The regulation is the final “early action measure” required under the Global Warming Solutions Act (AB32) signed by Governor Arnold Schwarzenegger in 2006. AB32 requires the state to reduce its greenhouse gas emissions 25 percent by 2020. The ARB has developed measures, guidelines and regulations aimed at achieving this goal.

“Fixing the leaks in existing landfill gas collection systems is a fast way to cut the methane gas that is directly harming the earth’s atmosphere,” said ARB Chairwoman Mary D. Nichols. “Even better, we will see an immediate health benefit, because methane is a precursor to smog.” According to the agency, the landfill regulation accounts for the second biggest emission reduction regulation approved by the ARB thus far, after the Low Carbon Fuel Standard.

CLEAN FUELS REQUIREMENT FOR OCEAN-GOING SHIPS

In 2000, the ARB developed its Diesel Risk Reduction Plan that set the goal of cutting diesel emissions by 85 percent by 2020. As part of the plan, effective July 1, 2009, all ocean-going vessels within 24 nautical miles of California’s coastline are required to use cleaner burning diesel fuel. The requirement is the result of a regulation adopted by ARB in 2008, aimed at reducing sulfur oxides, nitrogen oxides and diesel particulates. “This new measure will help coastal residents breath easier and reduce pollution in our oceans and waterways at the same time,” Governor Schwarzenegger said.
The requirement will affect approximately 2,000 ocean-going vessels per year, both U.S. flagged and foreign-flagged, visiting California. The vessels will have to use lower-sulfur marine distillates rather than the highly polluting heavy-fuel oil often called bunker fuel.
Initially, 13 tons-per-day of toxic particulate matter emitted from the vessels’ diesel engines will be eliminated. Reductions will increase as the fuel sulfur content is progressively lowered through the regulation’s phase-in. In 2012, when the very low sulfur fuel is required, an 83 percent reduction of diesel particulate matter is expected. Sulfur oxides will be reduced by 140 tons daily, a 95 percent reduction and nitrogen oxides will be reduced by 11 tons per day, a 6 percent reduction. Complying with the regulation would typically add $30,000 to a California port visit.