AQMD ANNUAL Emissions Reports (AER) & CTR – CALENDAR 2022

South Coast Air Quality Management District (South Coast AQMD) requires permitted facilities to report their emissions annually and pay any applicable fees based on the amount of air contaminants emitted as stated in South Coast AQMD Rule 301(e) under the Annual Emissions Reporting (AER) program. Additionally, the California Air Resources Board (CARB) amended its Regulation for the Reporting of Criteria Air Pollutants and Toxic Air Contaminants (CTR) in 2021 to include Additional Applicability Facilities in the state to be subject to reporting criteria pollutant and toxic air contaminant emissions. Per the CTR regulation, Additional Applicability Facilities are determined based on a facility’s industry code under the North American Industry Classification (NAICS) and/or Standard Industrial Classification (SIC) system, and in some cases also associated with activity and emission levels at the facility.

New for this Annual Emissions Reporting Period (Data Year 2022):

  • The 2022 Annual Emissions Report (AER) applies to the data year 2022 emissions reporting period (January 1, 2022 – December 31, 2022).
  • Submittal Due Date: Monday, May 1, 2023 at 5:00 p.m.
  • AB 2588 Quadrennial Report: For the 2022 AER, facilities in Phase 3 are required to file its Quadrennial Report (longer list of toxics).
  • Changes to Emissions Fees for Criteria Pollutants and Ozone Depleting Compounds per Rule 301 Table III
    • CPI increase of 6.5% for emissions fees.
  • Continued Reporting for Core Facilities subject to the California Air Resources Board’s (CARB) Criteria and Toxics Reporting (CTR) Regulation:
    • Criteria Facilities – facilities with permitted potential to emit > 250 tons per year for any applicable nonattainment pollutant or its precursors.
    • Greenhouse Gas Facilities – facilities subject to reporting under the California Regulation for the Mandatory Reporting of Greenhouse Gas Emissions, title 17, CCR, Section 95100 et seq.
    • Elevated Toxic Facilities – facilities identified by their local air district as “high priority” as of January 1 of the data year, based on the South Coast AQMD’s implementation of the AB 2588 “Hot Spots” requirements.
    • Core CTR facilities subject to reporting for data year 2022 and going forward must report all data as required by Section 93404 including stack parameter reporting and expanded list of toxics pursuant to CTR regulation Table B-2.
  • First Year of Reporting for Additional Applicability Facilities Subject to the CARB CTR Regulation:
    • Facilities with actual permitted and unpermitted emissions totaling > 4 tpy of any criteria air pollutant as defined in CTR regulations, or 100 tpy for carbon monoxide.
    • Facility whose permitted emissions processes match the primary or secondary Standard Industrial Classification (SIC) code or North American Industry Classification System (NAICS) code listed for Phase 1 of Table A-3 in CTR regulation and exceed the activity or emissions levels (if any) in this table for these permitted processes.
    • Additional Applicability Facilities subject to reporting data year 2022 described above must report all the data as required by Section 93404 including expanded list of toxics in CTR Table B-2 (except for stack parameter reporting).
  • Abbreviated Reporting Option:
    • Not applicable to Core CTR Facilities (Criteria, Greenhouse Gas, or Elevated Toxics) or facilities subject to the AB 2588 program.
    • Applicable to facilities that only operate processes listed below:
      • Agricultural operations limited to dairy, poultry, and swine farms.
      • Combustion of natural gas or propane in boilers or heaters.
      • Diesel-powered emergency standby generators, direct-drive emergency standby fire suppression pump engines, direct-drive emergency standby fire water pump engines, or other engines permitted as emergency equipment.
      • Dispensing of gasoline or diesel.
      • Cremation of humans or animals.
    • Default emissions factors are pre-populated in the AER reporting tool to simplify reporting under this option so that facilities only have to report activity level data.
    • Reports submitted using this option are exempt from toxic fee provisions of South Coast AQMD Rule 301(e)(7) unless the facility exceeds the criteria emissions reporting thresholds of Rule 301(e)(1)(B).
  • Expanded List of Toxics Pursuant to CTR Regulation
    • Starting in data year 2022 the expanded list of toxic pollutants pursuant to Table B-2 of CTR regulation (additional toxic substances) has been added to the AER reporting tool.
    • Pursuant to CTR regulation and for additional toxic substances in Table B-2 of CTR regulation, a new section has been added to the AER tool to allow reporting of the amount of these substances used or produced at the facility in lieu of reporting their air emissions when reasonable and technically justified emissions estimation of them are not possible.
  • Portable Equipment Registration Program (PERP)
    • Starting in data year 2022 emissions from equipment subject to CARB’s Portable Equipment Registration Program (PERP) need to be reported under the AER program.
    • The AER reporting tool now allows users to designate equipment as PERP. This designation will exempt PERP equipment emissions from fee calculations.
  • CTR Guidance for Data Year 2022 Reporting in 2023

EPA to Reconsider Ozone Standards

The Clean Air Act requires U.S. Environmental Protection Agency (EPA) to set National Ambient Air Quality Standards (NAAQS) for “criteria pollutants.” Currently, ozone (and related photochemical oxidants) and Particulate Matter (PM) are listed as criteria pollutants. The law requires EPA to periodically review the relevant scientific information and the standards and revise them, if appropriate, to ensure that the standards provide the requisite protection for public health and welfare. In 2020, the U.S. Environmental Protection Agency (EPA) decided to retain, without changes, the 2015 ozone National Ambient Air Quality Standards (NAAQS) set by the Obama-Biden Administration, which was set at 70 parts per billion (the previous limit, set in 2008 was 75 ppb).

EPA has recently announced its decision to reconsider both the Particulate Matter (PM) and Ozone Standards. EPA submitted proposed standards for the particulate matter (PM) NAAQS to the Office of Management and Budget (OMB) for inter-agency review, with plans to promulgate final rules before 2024. Stricter limits being considered for PM range from 8 to 10 micrograms per meter cubed (µg/m3) for the annual average and 25 to 30 µg/m3 for the 24-hour average.

While ozone levels have fallen by more than 20 percent over the past 20 years, about 100 counties have measured ozone levels above the 2015 standards. EPA has received numerous legal challenges to the 2020 Ozone standard, which was completed without an ozone-specific panel supporting EPA’s Clean Air Scientific Advisory Committee. According to South Coast Air Quality Management District (SCAQMD) officials, the current 70 ppb standard causes half the country to be in “non-attainment” status. Even a lowering of one or two parts per billion will put a large chunk of the country (primarily urban areas) in “non-attainment.” EPA is targeting the end of 2023 to complete this reconsideration.

Governor Unveils Climate Action Plan

In response to California Governor Gavin Newsom’s call for more aggressive climate measures, the California Air Resources Board (CARB) has laid out “the policies and actions California proposes to take to drastically reduce its dependence on fossil fuels and get to carbon neutrality by 2045 or earlier.” The agency has updated its scoping plan, which is purportedly the most aggressive approach to regulating Greenhouse gases (GHGs) by any jurisdiction in the world. The plan seeks to reduce petroleum usage in “every sector of the economy.” Fossil fuel consumption would be reduced by 94 percent. CARB aims for a statewide transition to renewable energy resources and zero-emission vehicles (ZEVs).

CARB is calling for local jurisdictions to focus on three priority areas: 1) Transportation electrification 2) VMT reduction and 3) Building decarbonization. In the transportation sector, CARB looks to increase deployment of ZEVs and reduce driving demand through a combination of the implementation of new or existing regulations, fuels programs, incentive programs, and Vehicle Miles Traveled (VMT) reduction initiatives. Strategies include parking pricing or transportation demand management pricing. State law (AB 2097, adopted by the Legislature and signed by the Governor in September 2022) already eliminated the minimum parking requirements for residential and commercial development within a half-mile of transit. Local governments such as cities are now barred from mandating parking spaces as part of most development near transit stops. The plan includes limiting residential parking to “less than one parking space per dwelling unit.”

VMT reduction initiatives are controversial as they may include punitive measures such as tax increases, to restrict mobility. CARB has not specified details on how it plans to achieve reductions in VMT. In the area of building decarbonization, the CARB plan showcases the City of Oakland’s requirements that all new construction be “all-electric.” Oakland is currently working on electrifying existing buildings. Other programs mandate charging infrastructure for electric vehicles in new construction starting in 2023. The agency will adopt policies and incentive programs (appliance rebates, existing building reach codes, or time of sale electrification ordinances) to electrify all appliances and equipment in buildings. Regulations for appliances in new construction would begin in 2026 for residential buildings and 2029 for commercial buildings. For existing residential buildings, 80 percent of appliance sales are to be electric by 2030 and 100 percent of appliance sales are to be electric by 2035 (appliances replaced at end of life). For existing commercial buildings, 80 percent of appliance sales are to be electric by 2030 and 100 percent of appliance sales are to be electric by 2045 (appliances replaced at end of life). According to CARB, local governments are “critical to implementing State-level measures to address GHG emissions associated with transportation and the built environment.”

Changes to Adhesives Rule

The South Coast Air Quality Management District adopted changes to its Rule 1168— Adhesive and Sealant Applications. Adhesive and sealant use subject to the rule spans a wide range of industries that have miscellaneous uses during manufacturing. Some of the industry sectors that make extensive use of products subject to this rule include adhesive manufacturing, rubber product manufacturing, asphalt shingle and coating, roofing contractors, flooring, hardwood veneer and plywood, industrial Building construction, oil and gas pipeline, foam products, wood windows/door/ kitchen cabinet/countertop manufacturing and paint and wallpaper stores. The rule also applies to products used by consumers that are not regulated by the CARB Consumer Product Regulation. It establishes Volatile Organic Compounds (VOC) limits for 59 categories of adhesives, adhesive primers, sealants, and sealant primers.

The latest amendments include prohibitions of para-Chlorobenzotrifluoride (pCBtF) and tertiary-Butyl Acetate (t-BAc). Sell-through and use-through periods will be allowed for products manufactured prior to the prohibition effective date. The rule includes a tiered prohibition schedule to allow more time for manufacturers to reformulate products that rely on pCBtF to meet existing rule VOC limits. For example, the prohibition of pCBtF for Roof Adhesive Primers becomes effective January 1, 2027 and that for the Roof Sealant Primers takes effect on January 1, 2025. The rule prohibits the use of t-BAc in manufacturing Regulated Products on and after 1/1/2024. VOC limits are being delayed or increased to accommodate some categories where a technical assessment by staff showed that compliant products are not available.

Staff points to the Office of Environmental Health Hazard Assessment (OEHHA, a state agency) as the catalyst for the changes. In 2020, OEHHA adopted the pCBtF Hot Spots cancer inhalation unit risk factor document, which indicated pCBtF is a potential carcinogen. Based on the pCBtF prohibition, staff adjusted some VOC limits and allowed time for reformulation where needed, which is mostly in roofing products. t-BAc is currently not defined as exempt as a VOC in Rule 1168. Therefore, no VOC limits are being impacted by the prohibition. The proposed amendment will allow manufacturers a year to reformulate any products that contain t-BAc.

Overall, Rule 1168 now establishes ten new categories and subcategories based on the technology assessment. In addition, it includes a new requirement for manufacturers to identify any products containing more than 0.01 weight percent of t-BAc and/or pCBtF and provide the weight percent in Quantity and Emission Reports. The rule eliminated the definition of energy curable materials and the accompanying test method for thin films (ASTM D7767-11), contending that the method was not approved by U.S. EPA and cannot be used to enforce a district rule. Staff will accept formulation data in lieu of an actual test, to report VOC content of energy curable adhesives and sealants.

The amendments added a conditional, limited VOC exemption for Opteon 1100 based on an assessment by OEHHA. The exemption applies only if: (1) OEHHA has sufficient information to establish a Cancer Inhalation Unit Risk Factor and does not adopt a Cancer Inhalation Unit Risk Factor for Opteon 1100 and (2) OEHHA has sufficient information to establish an acute reference exposure level (REL) and a chronic REL of Opteon 1100 and develops an acute REL (or interim acute REL) and a chronic REL (or interim chronic REL) for Opteon 1100 which are higher than the RELs for the Hydrofluoro-Olefin (HFO) it would replace. If the exemption is triggered following the OEHHA assessment, it would be limited to two-component foam sealants applied in an industrial or professional setting.

Throughout the rulemaking process industry representatives objected to the changes stating that the prohibitions of pCBtF and t-BAc will negatively impact their ability to comply with the future 250 g/L VOC limit in the rule. Additionally, the energy curable industry opposed the rule arguing that removal of the test method would add uncertainty to the rule and make facilities vulnerable to Notices of Violations by the district. The rule narrowly passed (by one vote) board adoption with board Members Rutherford, Rodriguez and Do voting “No” on the measure.