ILLINOIS

POLLUTION

CONTROL

BOARD

May

13,

1982

IN

THE

MATTER OF:

ALTERNATIVE CONTROL

STRATEGIES,

R81-20

INTERIM RULE,

INTERIM RULE

CHAPTER

2:

AIR

POLLUTION..

Adopted Rule0

Final

Order~.

OPINION

AND ORDER

OF THE BOARD

(by I,

Goodman):

This

rulemaking

is

undertaken

pursuant

to Section

9.3(b)

of

the Environmental

Protection Act

(the

Act),

as

amended by

P.A..

82—0540 on

September 16,

1981.

P.A..

82~0540~

known as

the ~Bubh1e

Bill”

or

NB

1354.

~qasdesigned

to enable

owners

and operators of air

pollution emission

sources,

either

indi-

vidually or collectively,

to utilize

the

most economically

advantageous mixture

of control strategies to

achieve environ-

mental goals.

This usua:Lly involves overcontrolling

at one

emission

source

and

undercontrolling

at

another,

The

statute

provides

that.

the mixture

of

control

strategies

used

in

an

“alternative control

strategy”

(ACS)

permit

must

provide

equivalent

protection

for the environment..

The

basic

concept

is that an ACS should

have

no

negative

impact on the environ-

ment and should

he economically beneficial

to

owners and

operators.

To insure

that

the unique

issues involved in

ACS

permits are adequately

addressed,

Section

9.3

authorizes the

Board to promulgate standards

for issuance

of permits and a

permitting program for

sources utilizing

alternative

control

strategies.

Section 9,3(b)

authorizes

the issuance

of

“interim regula-

tions” within 120

days

afte:t: the effective

date of P,A.

82—0540

through an expedited

rulemaking process which

bypasses Title VII

requirements of the

Act..

The purpose of this

expedited pro-

ceeding

is to provide

regulatory guidance

which will enable

owners

and operators

to

begin to plan and

implement

ACS to

meet imminent compliance

deadlines..

Section

9.3(c) mandates

that the Board promulgate

final

regulations

establishing an ACS

permit program no later

than December 31,

1982.

The record in

this proceeding

will be consolidated with

the final rulemaking

to avoid unnecessary

duplication.

In addition,

the final rule-

making will consider the

economic impacts of these

regulations

pursuant to Title VII

of the Act,

Once effective,

the final

regulations

will supersede the interim rules..

The Board acknowledges

the assistance

of Ms. Patricia

F.

Sharkey

in

the drafting

of

this

Opinion

and

in

acting as

hearing

officer

in

this

proceeding..

47~$9

---

The

Board initiated public

comment

on the interim rules

by circulating a “public draft”

proposal

and

inviting

comments

and alternative proposals.

The

Illinois

State Chamber of Com-

merce filed an alternative proposal which was consolidated for

review with the Board’s initial proposal under Docket R8l—20

on September 16,

1981.

The

Illinois

Environmental Protection

Agency

(IEPA) offered another alternative proposal on October

9,

1981.

These three proposals

were labeled Exhibits

1,

2,

and

3,

respectively,

in the record of

the

proceeding.

(Additional

amendatory language was proposed

and

entered into the record

in the course of the proceeding..)

Hearings were held on R81-20

on October

15,

16, and 19,

1981

to

consider the merits of all

proposals before the Board.

First

Notice was published in the

Illinois Register on January

18,

1982..

The Joint Committee on

Administrative Rules issued a certification of no objection on

May

11, 1982.

The final interim

rule

contains elements of each

of the proposals before the

Board, reflects

the public comment

and testimony received, and

incorporates

the comments

of the

Joint Committee on Administrative

Rules.

I.

Overview

Basically, these regulations

establish

a permitting program.

They describe the standards

for Agency

issuance of an ACS permit,

as well as the information which

must

be contained in an ACS per-

mit application to enable the

Agency

to make its determination.

Due to the nature of

ACS, several aspects

of

the ACS permit

program differ from the standard permitting requirements con-

tained in Part I of Chapter 2,

For

example,

an ACS application

must provide a demonstration

of

“equivalence”

to other existing

requirements with regard to

emissions,

environmental quality,

and methods of compliance.

In

addition,

each ACS emission

source must comply with unique limitations contained in its

permit.

These limitations are

predicated

on the compliance

of all other emission sources

in the

ACS.

Thus,

specialized

provisions are necessary for recordkeepirig

and reporting,

revision, renewal,

and describing the responsibilities and

liabilities of participants

in multi—person ACS.

Because ACS permits are

new and

potentially more complex

than other Chapter

2 permits,

the Board

anticipates that exten-

sive communication between the

permit

applicant and the Agency

will occur prior to issuance

of an

ACS permit.

The regulations

have been drafted to provide

the

flexibility necessary

to tailor

ACS permits to the variety of strategies which may be proposed.

In response to comments received

from

the Joint Committee on

Administrative Rules,

Section

212..llo(g)

has been modified to

require the Agency to demonstrate a need for any additional

information.

The application information, the recordkeeping

and reporting,

and the monitoring and testing provisions pro-

vide that the Agency may request any reasonable additional

information which may be needed

to

make

a determination and

47~60

---

3

insure compliance under a particular ACS configuration.

For

example, an ACS proposal may include non-traditional emission

sources, such as fugitive emission sources, or mobile sources.

Although these sources present special problems and will

undoubtedly require extensive documentation and safeguards

to insure equivalency and compliance, it is unnecessary to

address these special problems in the Board regulations.

The Agency can review such applications on a case—by-case

basis within the context of these regulations.

II.

Definitions

Chapter 2 definitions are made applicable to this Part.

(The Board notes that definitions are contained in both

Parts

I and II of Chapter 2.)

In particular, the definition

of “emission source”

(Rule

101),

i.e.,

“any equipment or

facility of a type capable of emitting specified air contami-

nents to the atmosphere,”

is important in the ACS context

because trades under an ACS would focus on each “emission

source” rather than an entire plant or “source.”

It should

also be noted that the definition of “person”

(Rule 101)

includes any “agency, political subdivision of this State,

any other state or political subdivision or agency thereof,”

Thus,

governmental bodies, as “owners or operators,” may

participate in an ACS.

Several new definitions are made applicable to this Part

only.

Notably, “Actual Emissions,”

“Allowable Emissions,”

“Emission Baseline,” “Potential to Emit,” and “Alternative

Control Strategy (ACS)”

are

essential terms

in an ACS context.

Some of these definitions may also be determined to apply to

“Part XI:

Major Source Review Programs”

in the course of the

final rulemaking on R81-16.

If so,

a change in placement of

the definitions may be appropriate at the time that regulation

is promulgated.

Definitions of “Major Stationary Source” and

“Stationary Source” were proposed to be included in the ACS

rules by Illinois EPA.

However, because ACS focus on “emission

sources,” the Board believes these definitions are irrelevant

to this rulemaking and that it would he better to focus on them

in R8l—16.

III. Standards of Issuance

Each of the four standards in Section 212.120 must be met

for issuance of an ACS permit.

Sections 212.120(a) and

(b)

reflect the statutory constraints contained in Section 39.1(a)

of the Act.

Section 212.120(c) requires that methods for

determining compliance must be equivalent to those associated

with otherwise applicable requirements.

The term “environmen-

tally equivalent” has been replaced with the term “equivalent”

47-61

---

4

in this section in response to the

comment

that

environmental

equivalence

is confusing with regard to methodology.

The func-

tion of this requirement

is to insure appropriate mechanisms

for determining the environmental equivalence of the ACS as

mandated by the Act.

Section 212.120(d)

states that certain

regulations cannot be superseded by an alternative strategy.

These are:

New Source Performance Standards

(Part IX),

National Emission Standards for Hazardous Air Pollutants

(Part X),

and the Major Source Permit Programs

(Part XI).*

The constraint with regard to new sources

is required by

the Clean Air Act as interpreted in Federal case law.

(See ASARCO,

Inc.

v.

EPA,

11 ERC 1129

(D.C.

Cir,

1978).)

IV.

Application Information

In addition to specific information with regard

to each

emission source,

the application must contain an analysis of

emissions, environmental quality,

and methods

of assuring com-

pliance.

This analysis will provide the basis for the Agency

determination of compliance with the standards of issuance and

the overall equivalence of the ACS with other regulatory and

statutory requirements.

In each analysis

(Sections 212.111,

212.112, and 212.113) the applicant must compare the ACS with

a “base case,”

i.e., the emissions,

impacts, or methods which

would exist or be allowed under existing regulations.

Basically, the analysis of emissions should compare ACS

emissions to the “baseline emissions,”

for each source involved

in an ACS.

Contrary to the argument of one commentor,

the com-

parison of baseline and ACS emissions for each emission source

is necessary to insure the equivalence and enforceability of the

ACS.

Notably,

U.S. EPA commented they will require submittal of

the emission limitations applicable to each emission source in a

“generic”

type ACS to insure federal enforceability.

Air quality

analysis is too cumbersome to serve as a mechanism for ongoing

oversight of an ACS or any other permit.

To insure that emis-

sion reductions relied on for other purposes are not “double—

counted”

and that other unanticipated effects will not accompany

the ACS, the analysis must also describe emission increases from

emission sources outside the ACS which may accompany the proposed

ACS.

In response to comments,

the additional phrase “or affect”

has been deleted from Section 212.111(b),

Although the Agency

may consider any emission increase from an outside source which

affects

an ACS,

it is not necessary to place the responsibility

for identifying such outside sources on the ACS applicant.

*The proposed Major Source Permit Program regulations are

the subject of Docket R8l-l6.

A rule adopting the interim

Non-attainment Area portion of these rules

(Interim Rule R81-l6)

was adopted on December

17,

1981.

The final rule

(R8l—16),

which will cover both Non—attainment and Attainment Areas

is awaiting an Economic Impact Study.

47-62

---

5

The environmental quality analysis must address air qual-

ity impacts, risk to the public health and welfare,

and other

environmental impacts associated with the proposed ACS.

Con-

trary to the argument of one commentor,

the requirement that

the ACS applicant describe any other environmental impacts

which

may

accompany

the

ACS is not overly broad.

The scope

of this analysis is mandated by the language of

P..A.

82-0540

which requires that ACS provide “equivalent protection of the

environment.”

The effect of ACS emissions on the environment

must be equivalent to that of emissions which would otherwise

occur or be allowed to occur.

V.

Modeling

Exemption

One

component

of

the

environmental

quality

analysis

required

of an ACS permit applicant under these regulations

is a compari-

son of air quality under existing

regulations

and under the ACS.

Generally, dispersion modeling

is required to predict the impact

of

the

ACS..

However,

because

modeling

is

expensive

and

may

not

be necessary to insure air quality

in some situations, Section

212,112(a) provides that the Agency may exempt an emission

source from the general modeling requirement if any one of

three specified demonstrations are made,

First,

Section 212.ll2(a)(1) provides that

if the pollutant

which is the subject of the ACS is not susceptible to modeling

or

if,

due

to

its

nature,

modeling

will

not

identify

its

air

quality impacts, the Agency may dispense with the modeling

requirement.

This, for example, may apply to VOC or NO

ACS

where modeling is often considered to produce ~

While providing flexibility,

this provision also includes

specific standards for the use of administrative discretion.

Second,

Section 212 112(a)(2) provides an exemption from

modeling requirements for sources located in close proximity

to one another.

The rationale for this exemption

is that

the

accepted modeling techniques do not distinguish the impact of

an ACS trade made between such sources as long as plume heights

remained relatively the same.

(Local impacts are primarily a

function of plume heights, while

long distance impacts are

primarily a function of the distance between emission sources.)

Although there

is discussion in the record of various other

distances

(R. 129—140),

the Board is persuaded by the

logic

supporting a 250 meter exemption.

The 250 meter distance

represents a reasonable estimate of the distance that could

occur between the location of the actual maximum impact and

the nearest modeled receptor if a receptor grid with 500 meter

spacing

is utilized.

This

is the grid spacing generally

accepted by U.S.

EPA for modeling.

Thus,

it should be con-

sistent with modeling demonstrations made in the SIP and

should provide equivalent protection of air quality.

47-63

---

6

U.S.. EPA commented that they believe that a better “rule

of thumb” for the plume height criteria of the modeling exemp-

tion in Section 2l2..112(a)(2)

would

be that emission increases

must always be higher than emission decreases..

Although this

would generally insure greater dispersion,

it would preclude

reasonable use of this exemption where an

increase

occurred

slightly lower than its off—setting decrease,

It would also

allow a great difference

in

plume

heights to

he

exempted

from

modeling so long as the

increase

was

the

higher.

The

use

of

the

“not

significantly

different”

plume height criteria both

provides reasonable

flexibility

and

more

accurately

addresses

situations

in which modeling is likely to be irrelevant

than

does

the

U.S..

EPA’s

proposed

language..

It

is anticipated

that

sources

qualifying under the

250

meter exemption will be considered to

fall

within

the

U.S.

EPA

“Generic Bubble” guidelines.

U.S.

EPA has

indicated

that

it

will

not

require

individual

SIP

review

of

ACS

permits

which

fall

within

the

“Generic

Bubble”

guidelines.

(See

46

FR

20552,

April

6,

1981 (Exhibit #10).)

Included in those guidelines

is a modeling exemption for emission sources located within

a specified distance

from

one

another

(100 to 250 meters).

The Board has provided the 250 meter exemption as well

as the

alternative exemption discussed below,

It is

anticipated

that both should meet U.S.

EPA “general bubble” guidelines.

Section 212.112(a)

(3)

contains an alternative exemption

from the modeling requirement which allows a permit applicant

to demonstrate that the differences in location, plume height,

etc.

are not likely

to

significantly

affect ambient air qual-

ity..

This option will enable applicants owning emission

sources which are greater

than

250 meters apart to demonstrate

that modeling is unnecessary for their particular ACS.

A

permittee may need

to

perform

limited modeling

or

monitoring

to demonstrate that significance levels will not be exceeded.

Because this exemption references the actual concern,

i.e.,

the impact of the ACS on air quality, it need not specify

distances between emission sources,

This provision exists

Within U.S. EPA itself as to the appropriate distance between

sources and the fact that testimony from modelers

in the

record of this proceeding revealed that in certain situations

distances between sources cannot be correlated to air quality

impacts.

It is anticipated that emission sources qualifying

under this exemption will fall within current “generic bubble”

guidelines and may be

exempt

from individual SIP review.

Impacts that are to

be considered

“significant”

are

estab-

lished in Section 2l2.1l2(a)(3),

These levels are taken from

the

U..S. EPA Emission Offset Interpretive Ruling,

Appendix

S

to 40 CFR 51,18(k),

IEPA indicated in the record that these

are the significance

levels they would

refer to in determining

whether modeling is

necessary.

(R.

286,

490..)

(Also see

47-64

---

Exhibit *17

)

To provide an enforcea

Ic stanlard for all

parties,

these levels are included

in th

Brard rules.

The

steel

ocr panics argue that the

igrit~ance

levels

in Section 212.112(3~should be u~d onlj

c

r’:eczfy what is

not sicrifr ant, while allowing the Agency l~discietion to

deterrnur~tnat higher levels are n

F

s’ a~f~ca~t

for other

reasons..

They argue that the fact that

cc cr core

receptor

points on a modeling grid exceed thresho d ~cv~ s

ay not be

conclusive evidence of a significart

impc~

(Sec

p.. l4~~l5,

P.C..

*26..)

CBE argues that there must

io~ bs ~ significantly

greater impact at any receptor..

They

ar

t~~rt~ocal monitor-

ing

si~esare not n~cessarilythe a~easof

g ~.a~t

impact.

(See p

‘

..C

~

Whene~ers~ ~yi

~r ~exia tnere

is alw ye a dang

of being overly restrct

e

I

vever,

the

purpose of a~cluding~pecific criteria

in trio

rule is to

provide

a ‘irck

and easily enforce ble

re~naagtest” to

deter

r

f

a

ci

g

is nece~~a y

o pr

~‘

t c environment.

It

is

iirpr~’pr t~consider

sacI~ a mechar~

al’d if

it indi-

cates ro impact,

but consider it questionab’r

if it indicates

some

irrpact..

The method for provirg the~ei~

r error

in

this

procedu

a

i~

to orovide modeling.

CB~~iarenfed thM~the “screening

~

~.ihi~h

provide

exemptions from m deling,

should be used orly

lere traditional

stack sources are involved; that the Board “hoald set specific

modeling criteria for fugitive emissions

a~dthat the Board

should specify thaF emission sources

cc tIc ~e’”tand most

appropriaL~models..

(See

pp.. ~

P.C..

#33

)

To insure that

the characteristics of the emission source ar~considered in

each of the “sreening”

tests,

Sections

2

2

12(a)(I)

and

(2)

have been modified to require such consideration.

Also, Sec-

tion 212

112(a) has been modified to state that all dispersion

modelirg must be based on the best and mcst appropriate models

for the poI1ut~atand emission sources irv

c’~.I.

U

S.. EPA drafts required that cli emass~ccpoirts in-

cluded in tre AC3 be

~ithin a specified diatnr~efrom one

another to take advantage of the “close proximi y” ~xemption,

However,

the justification for this positi~ara unclear in

light of the fact t~atthe focus of

t~~Ic ~juired

model-

ing and the exception is on the “emission ~oirce~

involved

in

a

particular

trade,

rather

than

the

entir

ACS..

(See

the

definit on of

~EmicsionSource”,

Rule

I

I,

hapter

2.)

For

example

under a given ACS,

sources A and d may increase

emissions on the condition that source C ;eiuces emissions

to the extent necessary to offset both i~rcreas~-s Since

the emission “trades” are between

“A and C” and ~B and

C”,

any change in air quality is a function of tho~etrades..

The distance between sources which are not “trading” emission

increases and decreases is irrelevant if the effect of each

trade within the ACS is adequately considered..

---

8

On a related point,

Illinois

EPA’s proposal required dis-

persion modeling only

for “major

sources..”

Although the fact

that a source is a major source is critical in the Major Source

Review Program context

(R8l—l6),

it

should not affect an

ACS.

This is because an

ACS is based on

trades between individual

“emission

sources” rather than entire “sources”,

as noted

above..

The correct

focus

in

these

rules

is on the amount

of

emissions and the

location of the

individual emission source.

VI..

Baseline

The establishment of the proper emission baseline for the

crediting of emission

increases and

reductions under an ACS was

hotly debated in this

proceeding.

The Board’s initial proposal

(Exhibit

1)

tracked

the

language of

U.S..

EPA Region V~s

“Generic

Bubble Rule”

and,

among

other

things,

related the baseline

determination to the data base relied on

in

the

SIP..

The

initial

Illinois

State

Chamber

of

Commerce

proposals

(Exhibits

2 and

2(a)) proposed that

existing

Board

emission limitations or

“allowable” emissions

be

used as the

baseline for ACS determina-

tions,

The Illinois EPA

(Exhibit

3) proposed that the lesser of

the actual or allowable

emissions

be used.

The second amended

ISCC proposal

(Exhibit 2(b))

largely

adopted the approach recom-

mended by the IEPA;

however,

it

proposed that the definition of

actual emissions “reflect

those

emission levels existing prior

to reductions beyond

the

requirements of Board regulations which

resulted from the

installation of

pollution

control

equipment,

changes in process

procedures, materials or

shutdowns.”

To

resolve this issue,

it

is necessary to

review the purposes of

P,A..

82—0540 and

the structure of the

air pollution control

program.

A.

Statutory

Purpose

The legislative

intent of

P.

A.

82—0540 is stated in the

findings of the General

Assembly

in

Section 9..3(a).

That

section indicates an

intent

to authorize

alternative control

strategies which are

“environmentally

equivalent to

(strategiesl

required by Board

regulations

or

the

terms

of

this Act” and

“assure equivalent protection of the environment..”

(Section

9,3(a))..

In both their

testimony

and comments,

industry repre-

sentatives have

argued that this language

is an “explicit”

requirement that

the allowable emission

limitations contained

in Board regulations

be used

as the

emission baseline for ACS

permits.

Far from

being explicit,

the statutory language

does

not mention emission

baseline.

The

General Assembly did speci-

fically state that

alternative control

strategies must provide

protection for the

environment equivalent

to that which would

exist under Board

regulations.

A strategy which

is environmen—

47-66

---

9

tally equivalent

to

Board regulations or

emission limitations

would

not

generally

utilize

the allowable

emission limitation

as the emission

baseline.

In fact, if one

reads into the statute

a requirement

that allowable emissions be

used as the emissions

baseline,

the

statute would be internally

inconsistent because

it would result

in environmental

degradation.

Testimony in

the

record indicated

that if owners

of

emission sources for which

actual

emissions

were utilized in the SIP

demonstration were

permitted to calculate decreases in emissions from the maximum

allowable emissions limit set

by Board

rules, emissions would

actually increase

and that,

as a result,

several areas of the

state which are

currently attainment

areas

or unclassified

areas

would

become

non-attainment

areas..

(R.

201,

441-445..)

B.

Lesser

of Actual or Allowable

Emissions as

the

Baseline

As aptly

stated by the Agency in the

record of this pro-

ceeding:

“The major

focus of air pollution control

efforts

has

been

and continues to be on what is actually happening, that

is,

the measurement of actual pollutant levels,

the assessment

of who is

causing or contributing to

those

levels,

and

what

reductions in emissions are necessary to ensure attainment

and maintenance of the

national

ambient air quality standards.”

(R..

417.)

The

use of

the

lesser

of

actual

or

allowable

emissions

as

the

baseline

to

insure

environmental

equivalence

is

dictated

by

the language and structure of the entire air pollution control

program.

The Clean Air Act,

the Environmental Protection Act,

the Board’s Rules* and the State

Implementation

Plan all have

*As stated in the earlier

Opinion,

the Board’s

existing

Rule

102

of

Chapter

2

is

a

direct

prohibition

on

the

discharge

of contaminents “either alone

or in combination

with

contami—

nents

from

other sources” which will prevent

attainment or

maintenance of the AQS.

In the Opinion of

the Board

accom-

panying adoption of Rule 102, the Board

emphasized the

goal

of

ensuring the air

quality standards:

“Because even the tightest emission standards cannot assure

that

emissions

are clean enough to

breathe, the unlimited

proliferation of sources in a

relatively

small area

could

result

in

violations

of

the

air

quality

standards

even

if

each

source

met

its

emission

standard

.....

Clompliance

with

the emission standards is a minimum;

it is

essential

that whatever measures are necessary, subject to proof

regarding economic reasonableness in the

particular case,

be taken to ensure that the air quality standards are met.”

(See Opinion of the Board,

47-67

---

10

as their stated goal the preservation of

existing

air

resources

and the achievement of the national air

quality

standards,

The

emission baseline utilized in an ACS must be established such

that attainment and maintenance of these air quality goals

will

not be jeopardized by emission increases projected under the ACS.

Although this does not mean the emission baseline used must

always be “actual emissions,”

it does require, as a minimum,

that no emission reductions be credited under an ACS which

are necessary for the achievement and maintenance

of

the air

quality goals

in Illinois,

The State Implementation Plan

(SIP)

is

the

“blueprint”

utilized

by

the State to “define the process

by

which

air

pollution

goals

will

be

achieved.”

(Illinois

SIP,

Executive

Summary,

p.

1.)

The original emission limitations adopted by

the Board

in

R7l-23

were

designed

to

be

a

component

of the State

Implementation

Plan.

Both the SIP and the Board regulations

were designed to achieve and maintain the federally established

AQS..

(See

Opinion of the Board, R7l-23,

p..2.)

The

air

quality

data, modeling, and projections

utilized

in

the

SIP

were a part

of

the

record

in

R7l—23,

and were relied upon

in

the Board’s

decision..

(See

Opinion

of

the

Board,

R7l-23,

pp..

2,

11,

17,

19,

27—29,

32—33,

38,

42,

44)..

Therefore,

the

data

used

as

the

basis

for both the emission limitations and the SIP should provide the

best available tool for determining

which decreases under an ACS

can be credited without disrupting the air quality program..

The SIP relied upon modeling which utilized the

lesser of

actual

or

allowable

emissions for emission

sources..

(See,

for

example, SIP Volume

2,

p.

721;

SIP Volume

3,

p..

813;

and

R..

198.)

The Board takes notice of testimony received

in

the R7l-23 and

R74-2 proceedings which outlined the methodology relied upon

in

the development of the SIP and the emission limitations..

(See

the abstracts of these proceedings prepared

by

Marder

and

Asso-

ciates

(the “Marder Report”),

pp.. 1—28 to

1—30,

1-51

to 1—53,)

Briefly, the following method was used:

1) the

Federal

AQS

were taken as the air quality goal;

2) existing air quality

data was compiled;

3) an emission inventory of

Illinois

emission

sources was compiled;

4) growth

projections

were

calculated

for

each source;

5)

the air quality data, the emission inventory

(with growth projections) and the proposed emission limitations

were plugged into a dispersion model;

6) the model produced a

graph indicating the air quality which could

be

expected

from

use of the proposed emission limitations under these specific

circumstances,

Simply speaking, this method used actual air

quality, actual emissions

(generally),

and a

set

of projections.

Actual emissions and actual background levels form the baseline

for the calculation of the appropriate allowable emission limita-

tion,

Thus, to assure the environmental equivalence of ACS

emissions,

it is necessary,

as

a general

rule,

to utilize the

lesser of actual or allowable emissions as the baseline for cal-

culating increases and decreases which will have an equivalent

effect,

47-68

---

C.

Allowable Emissions as the Emission Baseline

Use of the allowable emission limitations as the emission

baseline in ACS cannot assure achievement and maintenance of the

State’s air quality goals.

If the allowable emission rate is

substituted for actual emissions as the baseline in the

modeling

equation described above, either the AQS would not be met or the

allowable emission limitation would differ from that in the Board

regulations.

The use of the allowable emission rate as the base-

line in general for emission sources using this Part would simi-

larly distort the attainment equation and thus would not be

environmentally equivalent to existing regulations.

It

is probable that pollution would increase if allowable

emissions were used as the baseline for ACS because increments

of emission reductions take on an economic value under an ACS.

If a banking system is eventually adopted, even emission sources

which are not involved in an ACS could “bank” credit for an

artificial emission reduction equal

to the currently unutilized

emission increment or the difference between their actual and

allowable emissions.

Thus,

use of an allowable emissions base-

line would create an economic incentive for emission sources

to utilize or

“bank”

currently unutilized emission increments

up to the maximum allowable emissions.

An increase in actual

pollution is inevitable under these circumstances.

Such an

increase would be contrary to the equivalence intended by P.A.

82—0540 and the basic concept that ACS should be neutral.

D.

Mechanism

for

Demonstrating Equivalent Air Quality

Industry argues that an air quality analysis demonstrating

equivalent air quality would provide an adequate mechanism for

insuring “environmental equivalence.”

(See P.C. #26,

#28.)

This is incorrect.

The

very reason for having emission limita-

tions is the fact that air quality demonstrations do not provide

an adequate administrative and enforcement mechanism.

Modeling

and monitoring are too cumbersome and expensive to be performed

on a regular basis

to insure continued compliance.

The admin-

istration of permits utilizing only air quality demonstrations

to show environmental equivalence would be unworkable.

Modeling

and monitoring are also less reliable indicators with regard

E.

More Representative Time Period

Several witnesses in this proceeding expressed concern that

businesses which are currently operating below their normal pro-

duction capacity would be penalized by use of an actual emission

baseline which reflected current conditions.

To insure that this

does not occur,

the definition of actual emissions has been

drafted to require the Agency to utilize a more representative

47-69

---

12

does not represent normal source operation.

The burden of

demonstrating that another time period is more representative

is on the permit applicant.

To clarify a point raised in the

comments,

“normal operations” refers to historical operations,

rather than hypothetical operations.

If this were not the case,

a “paper” credit would exist

for the increment between actual

operations and hypothetical operations.

On a related point, ACS permits should retain the same

degree of flexibility as a regular permit.

The use of actual

emissions

as

a baseline should not be construed as a new lim-

itation on hours of operation or production levels.

For example,

an applicant may propose that emissions be calculated as

a

function of units of production or process weight

(R.

203—205).

“Process standards”

such as these are currently used in Chapter

2, e.g.,

Rule 203.

The calculations made from the baseline do

not create any new prohibitions

on

activities

which

are

other-

wise allowable under existing permits.

Contrary to the argument

of one commentor, these rules do not “cap” existing emissions

nor usurp business decisions.

(P.C.

#26.)

Unlike the proposal

which the Board rejected

in R79-3, the ACS provisions of the

Act and regulations allow businesses to voluntarily enter into

agreements to trade emission increases and decreases.

No busi-

ness

is required to do so,

and

business

discretion

is

expanded,

not

reduced.

The

limitations

that

apply

to

a

business

that

decides to utilize an ACS are

1)

that

equivalent

protection

of the environment be assured,

and 2) that reductions which

have been committed to “offset” ACS increases be maintained.

The first limitation is required by the Environmental Pro-

tection Act; the second arises as a result of the contract

existing between persons utilizing

an ACS.

Notwithstanding the general baseline rule, there is an

inequity created by disallowing emission reduction credits for

reductions achieved by virtue of pollution controls implemented

at a timeor in a situation where ACS were not available.

Although it is impossible to resolve all inequities,

Section

212,105(b)

limits this inequity to the extent possible consis-

tent with the mandate of “environmental equivalence.”

Section

212.105(b) creates an exception allowing emission reductions

to be credited under an ACS to the extent that

1) they were

achieved as a result of actions taken to reduce emissions,

2) they reduced emissions below required levels,

and 3) they

were not relied upon by the Agency in the compliance year

demonstration under the SIP.

Such emission reductions are

creditable only “to the extent” that they meet the stated

conditions.

Thus, that portion of a reduction which is

attributable to other factors or was predicted and relied

upon in the SIP is not creditable,

These three conditions,

47-70

---

1.3

taken

together,

provide

an

equitable

approach

to

crediting

emission reductions which would not have been achieved but

for actions taken to reduce emissions beyond what is normally

required.

At the same time, the condition that an emission

reduction cannot have been relied on in the SIP demonstration

insures that the crediting of these reductions will not inter-

fere with the State’s achievement of air quality goals.

By

crediting emission reductions whenever these conditions have

been

met, this provision should encourage owners of sources

to reduce emissions as

quickly

as

they

are

technologically

capable of doing

so.

Two

commentors suggested that Section 212.105(b) be re-

worded to indicate that emission reductions are creditable

to the determination of actual emissions.

(pp.

2-3, P.C.

#31;

pp.

3,

Attachment to P.C.

#28.)

The suggested rewording has

several problems.

First,

the suggested language is less rather

than

more

clear.

Second,

it

suggests

a

more

limited

concept.

Subsection

(b)

provides

a

framework

for

the

crediting

of

all

emission reductions,

rather than simply a supplement to the

computation of the actual

emission

baseline.

An increment of

emission reduction should be creditable as an emission reduc-

tion for emission sources using either an actual or allowable

emission baseline, subject, of course,

to the limitation in

Section 2l2.105(b)(2) that a reduction is creditable only to

the extent that it takes emissions below the requirements of

A.

Designed to Reduce Emissions

Many of the comments received during the First Notice

period focused on the prerequisites to utilization of Section

212.105(b).

At least one commentor argued that the “designed

to reduce emission” requirement is

a “motive test” which is

both inappropriate and unenforceable.

(P.C.

#28.)

This provi-

sion was not designed to probe the permittee’s intent.

Rather,

it was designed to insure an air quality impact equivalent

to that which would have otherwise existed.

Under the existing

rules, many reductions occur which accrue to the benefit of the

general public both in terms

of cleaner air and in improving

the State’s margin for growth.

ACS make it

possible

for

this

increment of air quality improvement to accrue to the benefit

of a private operator who can offset this “naturally occurring”

reduction with increases which would not otherwise have occurred.

This would create a negative environmental impact which is pro-

hibited by the statutory requirement of equivalence.

However,

the ACS concept is intended to allow owners and operators to

benefit from the creation of reductions which would not have

otherwise occurred.

For example,

if

a piece of equipment which

would normally have to be replaced after ten years

is replaced

after five years with cleaner, new equipment,

the owner/operator

has

created

a

reduction

(of

five

years

in

47-71

---

14

not have occurred

except

for the purpose of creating an e

•

Although determining the purpose for which an action is taken

requires individual

review

of the situation,

it need not be a

subjective decision.

Furthermore, the fact that other factors

(such as economic benefits) influence the decision does not

necessarily mean the reduction cannot be credited.

To make it

clear that the creation of an emission reduction need not be

the sole motivation for taking the action, but must be deter-

minative, the language of Subsection 212.105(b) (1) has been

modified

to allow credit for emission reductions “which would

not have occurred

but

for the purpose of creating an emission

B.

Relied Upon in the SIP

Both

industrial commentors and CBE have argued that the

“relied upon in the SIP” parameter is problematic.

Industry

argues that the SIP was never intended to be used for this

purpose;

that

it

is

too

vague

to

be

referenced

as

a

standard

(e.g.,

categories

of

reductions

are

often

relied

upon);

that

this

provision

over-delegates

authority

to

the

Agency;

and

that,

minimally,

only

reductions

“necessary”

to

show

attainment

should

be

unavailable.

On

the

other

side,

CBE

argues

that

actual

air

quality

and

therefore

actual

emissions,

not

what

was

relied

on

in

the

SIP,

must

serve

as

the

maintenance

strategy

in

attainment

areas

due

to

the

structure

of

the

PSD

increment

program;

that

emission

reductions

made

prior

to

the

SIP

monitoring

should

nat

be

available

because

they

were

reflected

in

the

monitored

back-

ground

or

basis

of

the

SIP;

that

uninventoried

sources

should

be

excluded

from

ACS

permits

until

they

are

brought

into

the

inventory;

and

that

sources

in

flA’s

without

a

SIP

demonstrating

attainment

should

not

be

permitted

to

participate

in

an

ACS.

In

its

comments, the IEPA agrees that the SIP criteria is

problematic,

but

states

that

it

should

be

implementable

within

the

administration

of

the

permit

program.

The

Agency

states

that

the

actions

on

which

it

has

relied

to

predict

attainment

in

the

SIP

are

for the most

part

categorical

rather

than

facility

specific,

for

example:

1)

reduced

emissions

as

a

consequence

of

improved

maintenance

procedures,

and

2)

reduced

fugitive

emissions

through

a

reasonable

fugitive

control

program.

The

Agency

states

it

would

also

look

at

the

assumptions

underlying

the

SIP

demonstration

as

reflected

in

ambient

air

monitoring

or

typical

industrial

practice,

and,

with

regard

to

specific

facil-

ities,

it

would

primarily

look

at

the

presence

of

equipment

or

control

devices

in

the

emission

inventory.

(P.C.

1.

The

SIP

as

A

Decision—Making

Standard

Recognizing

the

limitations

of

the

SIP,

the

proposed

rule

does

not

rely

on

the

SIP

inventory

for the definition of

baseline

emissions.

As

a

general

rule,

actual

emissions

is

the

47-72

---

baseline.

The

SIP

is

only

rec

~enced

to

determine

if

additional

emission

reductions,

which

are claimed to

have

been

made,

were

relied

upon

as

a

part

of

the

State

s

air

quality

strategy.

For

example,

if

the

SIP

assumed

the

replacement

of

older

equipment

with

newer,

cleaner

equipment

for

a

particular

industry

and the

State relied on that reduction as

a part of the demonstration,

the increment

of

reduction

attributable

to

that action

could

not be used

as

an

ACS

emission

reduction

credit

by

sources

in

that

industry.

The use of the SIP that

rs anticipated

by

this

rule, and that the Agency has indicated it would make,

should

be

of

a

general, but veiifiable

nature.

Given the fact that the SIP demonstration must include

a

certain margin

for

error

in

its

projections.

it

would

be

unreal-

istic to say that only those reductions which were absolutely

necessary to show attainment or maintenance should be considered

to have been “relied upon

“

(3cc P.3.

#26.)

However,

the burden

of proof with regard

t

reli n e

i~

the SIP is on the Agency.

At least one commentor argues that the

reference

to the

reductions

relied upon

ir

thu SIP in Section

212,l05(b)(3)

represents an illegal delegation to the Agency of the author-

ity

to establish emissron control

requirements that are

more

stringent

than the Board s rejulations.

(P.C.

#26,)

In

Commonwealth Edison Co. v.

Polution

Control Board,

343 N.E.

2d 459,

461

(1976),

the Illinois Supreme Court upheld a Board

rule authorizing the Agency to make case~’by~casedeterminations

altering the otherwise applica~Ic

-iir quality requirements

in

accordance with the Board~prescribedstandards of “justified

by necessary economic and social developments and will not

interfere with or become injurious to human health or welfare.”

Section

212,105(b)(3)

contains several

similar and,

in fact,

more definite standards

Specifically, a reduction must have

been

1)

“relied upon,”

)

rin

the State

Implementation

Plan”

(which

is

a

fixed

ana

verifiabic

public

document),

and

3)

“to

demonstrate

compliance

with

The

ambient

air

quality

standards”

or “maintenance of air quality.”

Section 212,105(c) provides

additional insurance that the Agency~scase~by-~casedetermina-

tions

follow the

prescribed

standard by placing the burden of

proof on this issue on the Agency.

Lastly, all Agency permit

determinations are reviewable by the Board under Section 40

of the

Environmental

Protection

Act.

As

written,

Section

2l2.l05(b)(3) provides

both

specific

standards

and procedural

safeguards

adequately limiting Agency discretion.

2,

~

CBE argues that the additional

creditable reductions

referred to in Section 212,105(b) should not be available to

emission sources located

in attainment areas because actual

emissions form the baseline for the PSD increment program.

If an industry took steps to improve

air

quality

beyond the

---

16

‘jajutenance’

level

reflected

in

the

SIP,

that

increment

of

reduction

would

be

added

to

the

growth

increment

for

new

in-

dustry

under

the

PSD

program.

Therefore,

there

is

no

apparent

inconsistency

in

providing

that

such

a

reduction

can

be

used

for ACS purposes under these rules.

The PSD rules were not

intended to favor

new

industries over existing industries, but

simply

to

insure

a

margin

for

growth.

As

written,

the

proposed

rule

for

additional

creditable

reductions

contains

adequate

safeguards

for

maintenance

of

a

growth

increment.

Of

course,

a

single

emission

reduction

cannot

be

‘double—counted’

or

used

both

to

offset

new

growth

and ACS increases.

This ‘double—

counting’ is prohibited

by

Section

212.111(b)

and the Standards

of Issuance.

On a related point, several ccmmentors have pointed

out that

both

the

Environmental

Protection

Act

and

the

Federal

Clean Air

Act

require

maintenance

of

air

quality,

as

opposed

to

just

attainment

of

the

&QS,

in

attainment

or

clean

areas.

One

of

the

standards

of

issuance,

Section

212.120(b),

states

that

the

impact

of

an

ACS

must

be

environmentally

equivalent

to

that

which

would

otherwise

be

achieved

and maintained.

However,

the

former

proposed

Section

212.105(b)1N)

~If~nc

only compliance

with the

AQS

and

could

be

interpreted

as

allowing

all

attainment

area sources to utilize an ‘allowable’ emissions baseline.

This

was

not the Board’s intention.

To remedy this, Section

212.105(b)(3) has

been

amended

to reference ‘maintenance of

air quality’ for

areas

other

than

non—attainment

areas

(i.e., attainment and unclassified counties).

3.

Oninventoried Sources and Emission Levels_U~q~

in

the

SIP

Monitored and modeled background emission levels form

the basis of the SIP.

Therefore, emission reductions achieved

prior to or at the

time

of such monitoring are included in the

SIP

and

must

be

considered

to

have

been

‘relied

upon’

to

project

attainment

or

maintenance.

Also,

although

not

individually

identified,

the

existence

of

a

certain

number

of

malfunction

emissions and uninventoried sources are presumed in the SIP

calculations.

Projected emissions from these sources have

been included in the monitored background levels.

(R. 373)

While these projections may be inexact, the margin of error

is limited by the fact that most large emission sources are

likely to have

been

inventoried.

An uninventoried source

should be considered subject to the

same

categories of

4.

Na’s for Which the SIP Does Not Demonstrate

Attainment

CBE points out that there is at least one Na in Illinois

(Southeast

Chicago)

for

which

the

State

has

failed

to

specify

47-74

---

17

and commit to controls which will bring that area into

attain

-

ment (of the TSP

AQS)

by the deadlines mandated in the Clean Air

Act.

CBE argues that emission reductions made

in these areas

should not be allowed to be used

in ACS because they are needed

for the attainment demonstration.

This argument implies that

these emission reductions would exist if the ACS were not avail-

able.

But, to the extent that an ACS permit is based on an

“actual” emission baseline,

it would always involve the creation

of

a new emission reduction which would not have occurred hut

for the ACS,

Thus,

an ACS based on actual emissions would not

“usurp” e.r.c.’s which would otherwise be available for the SIP

demonstration.

In

fact, the availability of ACS

in such a NAA

may enable sources that are currently unable to reduce emissions

at one emission source to over—control another emission source

to come into compliance.

This could speed the attainment of

the

AQS for the area,

If further reductions are needed in an area to show attain-

ment by mandated deadlines,

substantive regulations requiring

those reductions will be applicable to ACS permittees just as

they are to other permittees.

(B.

356,

492.)

tinder Section

212,105(a), the emission baseline

is the “lesser of the actual

emissions or the allowable emissions prescribed by this Chapter.”

Thus,

if the allowable emission limits are made more stringent,

the emission baseline for ACS permits

is reduced and the ACS

permit must be revised pursuant to Section 212,160(a)(2).

An

example of such an emission limitation would be future RACT

requirements.

CBE is correct in stating that the control

obligations

for ACS participants cannot be regarded as

fixed

any more than the obligations of other permittees are fixed.

(See Rule 103(g)

of Chapter 2 re: the Agency’s authority to

revise permits upon the revision of the Act or Chapter

2

regulations.)

A unique problem does arise, however, if an ACS participant

in a NAA which does not have a SIP demonstration proposes to

utilize an emission baseline which includes credit for reduc-

tions

above its actual emissions pursuant to Section 212.105(b).

The difficulty is that no SIP demonstration exists for such an

area and, therefore,

the condition in Section 2l2.l05(b)(3)

cannot be complied with,

Absent a SIP demonstration, we have

not identified the reductions which are required for attainment

and thus we cannot identify “surplus” reductions that are not

necessary to assure attainment,

To clarify this and insure that

ACS permits do not create an actual

increase in emissions

in an

area that is known to have unhealthy air, Section 212.105(d)

has been added to indicate that an emission reduction shall be

creditable beyond the baseline

in subsection

(a) only if the

State Implementation Plan demonstrates attainment for the area

and pollutants involved by the compliance year.

47-75

---

18

C.

Emission_Reduction

Credits from

Shutdown

Emission Sources

The former proposed rule did not address the use of emission

reduction credits obtained from the shutdown of an

emission

source

because

the Board felt that the issue had not been

adequately

discussed

in

the

record~

However,

comments

received

during

the

First

Notice Period indicate that a clarification

of

the

appli-

cability of the interim rule to shutdowns is necessary.

Some of

the arguments presented for crediting reductions from shutdowns

are that they represent a large number of available emission

reduction credits; that several industries have relied

on

the

availability

of

these

credits;

and

that

to

disallow these

credits would create an incentive for keeping older,

dirtier

plants

and lines in service longer.

One comrnentor argues that

owners

of emission sources have a property ~right”

to

the

emis-

sion increment and that State denial of the use of this incre-

ment is

an unconstitutional ~taking” of property,

(P.C.

#26.)

Another commentor argues that reductions from a shutdown

should

be

creditable

only

if the plant or line is shut

down

before

the

end

of its expected life and that such reduction credits should

be limited in duration to the difference in time between its

actual shutdown and its expected life.

(P.C.

#32.)

In response to these comments, Section 2l2,105(b)(l) has

been amended to include shutdowns.

An emission reduction

created

by the premature shutdown of an emission

source

is

not

essentially

different from that created by the

modification

of

process, materials,

etc.

The duration of an e.r.c. created by

a shutdown is determined by the duration of the ACS permit,

as

is

the

duration of any other emission reduction credit.

The

fact

that an emission source

is permanently shut

down

does

not

mean

it

creates a permanent c.r.c.,

Rather, an

emission

reduc-

tion credit

is available only in the context of the

Board’s

permit

rules and from permitted emission sources.

If

a

source

is

prematurely shut down

in order to create an emission

reduc-

tion credit,

that

emission

source may he issued a

“zero—discharge”

ACS

permit.

Section 212,145 has been amended to indicate that

the

duration of

a permit and its renewability is

linked

to

the

life

expectancy of the emission source,

This

is

essential

in

order

to

preserve the “environmental equivalency”

of the ACS

over time.

For example,

if a product line is shut

down

three

years early,

under its “zero discharge” permit,

its

e.r.c,

can be

used to offset emission increases for three years.

If

it

is

shut down ten years early,

it can participate in a

five

year

ACS

permit and renew the permit for an

additional

five

years.

When the lifetime

of

the

emission

source is

exhausted,

the e.r.c.

is also exhausted and the ACS permit

must

be

revised.

The burden of proving the useful

life of the emission

source

is on the applicant.

47~76

---

VIII,

~12i4~

~

Section 2

2

native Control

~‘

r

deadlines whic

a

“as

expediti ulil

sources which

c-~.

are

required to d

c

V

c~~iI

rc~

ib

utilizing

an

Alter—

u

105F

t~iesame

compliance

1

rd

y Cnso~er2,

The tern

I

c~ed to indicate that

~ hc~

t~

he stated

deadline

Section

212.

rule

for

sour o~

c

a

(VOC

emissi

s

of

the Clean Ai

extend the

corrpl

until December

‘

replete with tes

would otherwisc b

~

strategy will ~

an

extension ~2~eto

t

an

Alternative Co ~trol~

December

31,

19

c

in

59—60,

8~

If p

e

sources will b~I

achieve the

sar e

contrary

to the

rtert

o

injury to the liii

a

environmental b nd

Section 2

tion

to the

g rer~

r

for

the issuance of

pliance plans

to

L

1

absolutely necessary

the

compliance

plan

permit,

whi~h

subject

to

the

Agerc

approve

such

a

plan

th

is

genuinely necc.~ar

sistent with thc C ca

A

ç~

b~sa.

~csp

~i

to the general

c

Rul

205

of Chapter 2

~e~t with Section 172

~q.

id

allows

states

to

i~~ain

ert of the ozone

standard

r. t is proceeding

is

~

tha

m~nysources

which

i

1

a~alternative

control

n~

o

i

tne absence

of

such

y

I

preparing and

setting

up

j

cIorc~da currently

applicable

~

(tee

H

29~30,

40,

49—53,

t

~ir.g an ACS,

many of

these

or~cxpensive controls

to

c

~

~ ch a result would be

,

1d wouid result

in

~t1

ut yielding significant

t

ar ~

de a narrow

excep—

~

?3

ir

has tailored standards

p

i

~ai~ir~galternative

com—

Is

i

~cption is no broader

than

ts~

w

dii

thi~limited exception,

I

~i

n an Aaency~approved

~t~nbcc ~l, 1982,

and

be

n bI

r

i. ipation

procedures.

To

c’ency m~~

find that an extension

S

v~r~ur.cntai1y

be~ieficial, and

con—

In detent

nj

di

r

~c

c~~nding the compliance

deadline,

the Board anti i~tes tiat tue

gency will

consider

factors such as the

m~

£

~t

£

di pro osed ACS,

the time

required for equ

re1it

ursta

n

Ir~al1ation, and the good

faith efforts nf

e

~r

ftc~~’

~

the ACS as quickly

as possible.

In adddiio

tIc Pgercy

ust find that the ~.CSwill

result in a net berefit di

us

ri. rotment, either

in terms of

faster or greater cmi.

io.

re

u

iors than would otherwise be

achieved.

Final?

,

thc

r cu

c crt di

tonsistency with the

Clean Air Act” r~

si

as

to

I ~r~y t

fird

among

other things,

that reasonable f’rthe~

r

ness

towar?3. attainment of

the

ambient air quality ~tard xl

~c’~~spandized,

---

20

Commentors point out that

if an ACS permit containing

a

compliance date extension must actually be issued by December

31,

1982,

ACS applicants must submit an application

to the

Agency by July

1,

1982

in order to give the Agency

180 days

to act on the application as prescribed by statute.

(P.C.

#28.)

Since

it is unlikely that this rule will be effective before

June

1,

1982,

this

tight

time

frame

could

preclude

the

thorough

review

and

analysis

necessary

for

submission

of

a

complete

application.

This time frame would also place the Agency under

unnecessary pressure in reviewing initial applications under

this new permit program.

In light of these considerations,

Section

212.130

has been amended to require that the permit

application be submitted no later than December

31,

1982,

rather than that the permit actually be issued by that date.

The Agency points out that the

compliance

dates for many

sources

subject

to

Rule

205 of Chapter

2

have

already

passed.

(See

Rule

205(j),)

The

extension

provision

is

not

intended

to

protect

emission

sources

which

are

in

violation

of

applicable

compliance

deadlines,

Therefore,

the

extension

provision

has

been

modified

to

make

it

clear

that

it

applies

only

to

emission

sources with compliance deadlines of December 31,

1982 or later.

One

cornmentor

argues

that

the condition

in

Section

2l2.l30(b)(2), that the ACS result in greater or faster over-

all emission reductions,

is more restrictive

than the Federal

Clean Air Act because U.S.

EPA’s position papers have only ap-

plied this prerequisite to compliance extensions

for sources in

non-attainment areas,

(P.C.

#28.)

This argument is convoluted

in

several

respects.

First,

it overlooks the

fact

that

U.S.

EPA’s

position

papers on this topic are merely guidance and

do not rise to the level

of a requirement under the Clean Air

Act.

Second,

it

overlooks

the

fact

that

Illinois

emission

sources

in

both

attainment

and

non—attainment

areas

are

sub-

ject to Rule 205 requirements

and compliance deadlines.

If

anything, Section 212.130 relaxes existing requirements for

emission sources in attainment

areas.

The

function

of

the

requirement in Section 2l2,130(b)(2) is,

as stated in the

proposed opinion, to “offset”

the

delay

in

emission

reduc-

tions

and

to

insure

that the ACS provisions do not become

an

avenue

for

avoidance

of

existing

deadlines.

In response to another related comment,

it

is not incon-

sistent to expect

faster overall emission reductions may be

achieved by use of an ACS containing a delayed compliance

schedule than might otherwise be achieved.

(See P.C.

#31.)

If,

for example, a source could not otherwise meet the appli-

cable compliance deadline and would require an individual

variance,

an ACS may provide a faster achievement strategy.

47-78

---

21

IX.

“Generic Bubble Determination

These

rules will

be

reviewed

by U.S.

EPA

for

compliance

with

the federal “Generic Bubble” policy.

As

stated

above,

the

“Generic

Bubble” policy defines a type

of

relatively simple ACS

which

U.S.

EPA

has determined will not

require

individual

SIP

revisions,

Although several provisions of

these

rules

go

beyond

the current approved U.S.

EPA policy,

it is

the

function

of

these

rules,

as a whole,

to provide a framework for

all

ACS,

not

just

simple “Generic Bubbles,”

Rather than attempt to

anticipate

changes in U.S.

EPA policy on an issue over which the State has

no jurisdiction, the Board is promulgating the rule as a whole

and

will

allow

U.S.

EPA to designate those portions which meet

their

requirements

for Generic

Rules.

For

example,

these

rules

make

a

general

provision for fugitive

emission

sources

to

par-

ticipate in ACS.

U.S. EPA may designate the specific type of

fugitive emission trades which fall under their “Generic Bubble”

policy.

ACS falling within those designated provisions will not

require

individual

SIP revisions.

X.

verthilit~y

Section

212.190 has been added to the rules

stating

that

the

provisions

of Part 212 are not severable.

This

provision

is

essential

due to the interdependence

of

emission

sources

operating

under ACS, the careful balancing

of

emission

increases

and

decreases

which is necessary to insure

environmental

pro-

tection,

and the interdependence and balance within the rules

themselves.

XI.

Miscellaneous_Revisions

to the Rule

The following miscellaneous revisions to the rule have

been

made

in

response

to

comments received during

the

First

Notice

Period:

1.

The

definition of “Actual Emissions” has

been

slightly

amended in the final version of the rules.

To close a potential

“loophole”

in Subsection

(b),

the term “allowable emissions” has

been replaced with “potential

to emit,”

A rule

requiring

use

of the allowable emission baseline where there is inadequate

information to determine actual emissions would provide a dis’-

incentive

for good bookkeeping.

The use of “potential

to

emit,”

a

defined term,

will also more accurately reflect the

capacity

of the particular equipment to emit.

The same standard can be

used for sources

which have been in operation less than two

years,

thus subsection

(c)

has been

deleted

as

unnecessary.

2.

Section 212.102 has been amended to clarify the fact

that all emission

sources are within the scope of this Part.

3.

Sections

212,110(f)

and 212,120(e)

have

been

added

47-79

---

22

in

response

to U.S. EPA’s comment that it must approve ACS

which involve

an emission source which is subject to a federal

enforcement action before the State approves the permit.

(P.C.

#29.)

This provision

anticipates that

federal

review

will

occur within the

time frame allotted for State review of the

application so that there

is

no

additional

delay.

4.

Section 212.125

(Public Participation) has been amended

to clarify

the standard for when a public hearing is required.

The avai1abi1it~~

of a public hearing should be determined pur-

suant to the criteria in applicable Agency public participation

procedures, rather than pursuant to a potentially conflicting

Board

criteria.

Contrary

to

the

argument

of

one

commentor,

ACS

permits do not establish less stringent emission

limitations

and

public hearings may not be necessary or beneficial

in all

cases.

5,

Section 212.170

(Revocation) has been deleted as un-

necessary because both the Act and Chapter

2 currently provide

for permit revocation and other appropriate sanctions.

6.

Section 212.211(d)

has been deleted

as unnecessary.

ORDER

It

is the Order of the Illinois Pollution Control Board

that Chapter

2:

Air Pollution Regulations be amended by the

addition of Part 212:

Alternative Control Strategies,

as

follows:

TITLE

35:

ENVIRONMENTAL

PROTECTION

SUBTITLE B:

AIR POLLUTION

CHAPTER I:

POLLUTION CONTROL BOARD

PART 212:

ALTERNATIVE CONTROL STRATEGIES

SUBPART

A:

ALTERNATIVE CONTROL STRATEGIES INVOLVING ONE PERSON

Section 212.101

Definitions

Unless a different meaning of

a term

is clear from its

context,

the definitions

of

terms used for this Part

shall

be

the

same

as

those

used in the Pollution Control Board Rules and Regulations,

Chapter

2:

Air

Pollution,

Actual

Emissions

The actual rate of annual

emissions

of

a

pol-

lutant from an

operational emission source for a particular date

equal to the mean rate at which the emission source actually

emitted the pollutant during the two-year period which immediately

precedes the particular date and which

is

determined

by

the

Agency

to be representative of normal emission source

operation;

however:

47-80

---

23

a)

The Agency

shall allow the use of a

different

time

period upon a determination that

it is

more

repre-

sentative of normal emission source operation.

The

burden

shall be on the applicant

to

demonstrate

that

another time period is more representative.

Actual

emissions shall be calculated using the emission

source’s

actual operating hours,

production

rates,

and

types of materials processed,

stored,

or

corn—

busted during the selected time

period.

h)

If

the Agency determines that there is inadequate

information to determine actual emissions as indi-

cated in the preceding paragraphs, the Agency shall

use

the potential to emit of the

emission

source.

Allowable

Emissions:

a)

The emissions rate of an emission

source

calculated

using the maximum rated capacity of the emission source

(unless

the emission

source

is

subject

to permit condi-

tions or other enforceable limits

which

restrict

the

operating rate,

or hours of operation,

or both)

and

the more stringent of the following:

1)

the applicable emission standard or limitation

contained

in

this

Chapter,

including those with

a future compliance date;

or

.2)

the emissions rate specified as

a permit condition

including those with a future compliance date.

b)

The

allowable emissions

may

be

expressed

as

a

permit

condition limiting annual

emissions

or

material

or

fuel

throughput.

c)

Allowable

emissions shall include a reasonable esti-

mate of emissions in excess of applicable standards

during start—up, malfunction, or breakdown,

as

appropriate, only if the provisions of Rule

105 of

this Chapter have been complied with.

d)

If an emission source is not subject to an emission

standard under provision

(a) and is not conditioned

pursuant to provision

(b), the allowable emissions

shall be the source’s potential to emit,

Alternative

Control Strategy

(ACS):

A specific program of

emissions

limitations and requirements

which

is

environmentally

equivalent

to that which would otherwise be required by appli-

cable statutes or regulations, and under

which the owner or

operator

of an emission source increases emissions of

a regu-

lated

pollutant

beyond the emission baseline at

one or more

47-81

---

24

emission sources and correspondingly reduces emissions of the

same pollutant below the emission baseline at other

emission

sources.

Chapter:

References to “this chapter” or “Chapter 2”

in this

Part shall

mean Pollution Control Board air pollution rules

and regulations as contained in Chapter

2:

Air Pollution

Regulations

and as codified under Title

35,

Part 200, etseq.,

of the Illinois Administrative Code.

Emissions

Baseline:

The starting point or reference

level

from which increases and decreases in emissions are measured.

The rules governing determination of emission offsets, calcula-

tion of net

emission increases,

and evaluation of alternative

control

strategies

specify the particular emission baseline

that applies for that purpose.

~~—er~2nACS:

An Alternative Control Strategy which

includes

emission

sources which are owned and

controlled

by

different

persons

who have formed a joint

venture

for

purposes

of the ACS.

Potential

to

Emit:

The maximum capacity of an

emission

source

to emit a pollutant under

its physical and operational

design.

Any physical or operational

limitation on the capacity of the

emission source to emit

a pollutant,

including

air

pollution

control equipment and restrictions on hours of operation or on

the type or amount of material combusted,

stored,

or processed,

shall be treated as

part

of

its

design

only

if the limitation

or the effect

it would have on emissions

is enforceable.

Secondary

emissions do not count in determining the potential

to emit of a stationary source.

ug:

Micrograms.

Section

212.102

Scope

Pursuant to a permit issued by the Agency

under

this

Part,

a

person or

persons may use an alternative control

strategy

(ACS)

for emission sources, including fugitive emission

sources,

in

lieu of

compliance with conflicting requirements which would

otherwise be applicable under this Chapter,

Section 212.105

Emission Baseline for Alternative Control

a)

The baseline for reviewing decreases or

increases

of

emissions from emission sources which are the

subject

of an alternative control strategy shall be the lesser

of the actual emissions or the allowable emissions

prescribed by this Chapter.

47-82

---

25

b)

Notwithstanding

subsection

(a),

an

increment

of

emission

reduction

shall

be

creditable

under an ACS

to the extent that it:

1)

was achieved as a result of the installation of

pollution control equipment,

changes

in process,

procedures, or materials,

or the shutdown of an

emission source which would not have occured but

for the purpose of creating an emission reduction;

2)

reduced emissions beyond the requirements of

Board regulations;

and

3)

was not relied upon in the State Implementation

Plan demonstration to demonstrate compliance with

ambient air quality

standards

in

the

compliance

year in non—attainment areas or maintenance of

air quality

in other areas.

c)

For purposes

of

subsection

(b),

the

burden

shall

generally be on the permit applicant.

However,

for

the purpose of subsection

(b)(3) the burden shall

be on

the Agency to demonstrate that the emission reduction

in question (from either the

particular

emission

source

or the

category

of emission sources to which it belongs)

was

relied upon in the SIP demonstration.

d)

Notwithstanding subsection

(b)(3’j,

if

an

emission

source

is located in an area for which the State

Implementation Plan does

not

demonstrate

attainment

of

the

air

quality

standards

by

the

compliance

year

for

the

pollutant

which

is

the

subject

of

the

ACS,

it

may

utilize

an

emission

reduction

credit

only

to

the

extent

that

that

reduction

reduces

its

emissions

below

actual

emissions,

Section

212,110

~_~li2~onIn~ormation

In

addition to other information which may be required under

this

chapter,

a

permit

application

under

this

subpart shall:

a)

List the emission

sources

to

be

included

in

the

ACS,

the emission baseline the applicant believes to be

applicable

to

each emission source, and the remaining

useful

life

of

each

emission

source,

b)

Describe the proposed modifications to the emission

sources and

quantify the emission increases and

decreases anticipated to occur as a

result

of

each

modification,

47-83

---

26

c)

Identify the Board regulations and the terms of the

Environmental Protection Act to which the applicant

believes the ACS provides an alternative,

d)

Describe the methods currently used to assure com-

pliance and the methods proposed to he used under the

ACS.

Such methods may include, but are

not

limited

to

recordkeeping, equipment

or

emissions

monitoring,

source testing, and material or process specifications.

e)

Provide an analysis of the ACS pursuant to Sections

212.111,

212,112,

212,113,

f)

Contain a certification, signed by all ACS applicants,

stating

that

a

copy

of

the ACS application has been

sent

to U.S.

EPA if any of the emission sources

included in the ACS are presently the

subject

of

federal enforcement actions under the

provisions

of the Clean Air Act,

as amended august,

1977 (in-

cluding civil actions filed under §113(b), criminal

actions filed under §113(c),

a notice imposing non-

compliance penalties issued under §120,

administrative

orders

issued under §113(a),

or a citizen

suit

filed

under §304 where EPA has intervened).

g)

Provide such other information as the Agency can

demonstrate to be necessary for the determination

of compliance with the standards of issuance in

Section 212,120,

including the results of any source

tests

or

ambient

air

monitoring.

Section

212.111

Ana1~ysis

of

Emissions

a)

A

permit

application under this subpart

shall

provide

a

comparison

of

the

baseline

emissions

and

the

emis-

sions which would be

permitted

under

the

proposed

ACS

for each emission source involved in the ACS.

Where

appropriate, this analysis shall address

differences

between the emission sources to be covered by the ACS

with regard

to:

1)

methods of determining emissions;

2)

consistency

and

reliability of the performance

of the emission sources and any associated

control devices;

3)

frequency and duration of operation during

malfunction or breakdown,

or excess emissions

during start-up;

47-84

---

27

4)

methods

of operation, including operating

schedules, range of raw materials or products,

etc.; and

5)

other characteristics of the emission sources or

their operation which may affect equivalance of

emissions.

b)

The analysis shall describe any increases in emissions

from emission sources outside the ACS which may

accompany

the proposed ACS.

Section 212. 112

Av~~s_Ey~~a1

Quality

a)

A

permit

application under this subpart shall provide

a comparison of the ambient air quality under existing

requirements and the ambient air quality which would

exist under the proposed ACS.

This analysis shall

include dispersion modeling based on the best and most

appropriate models for the pollutant and emission

sources involved, unless the Agency finds that:

1)

due

to the characteristics of the pollutant

and

emission

source,

dispersion

modeling

is

inappropriate

or

unnecessary

for

determining

effects on air quality; or

2)

the

location

of emission sources included

in the

ACS

are not more than 250 meters

apart,

the ef-

fective plume height of the emission increases

and decreases are not significantly different,

and the differences in the characteristics of

the

emission

sources

are

not

likely

to

affect

ambient air quality, or

3)

differences

in

location,

plume

height,

operating

practice, and other characteristics of the ernis—

sion sources subject to the ACS are not likely.

to significantly affect ambient air quality.

An effect

on ambient air

quality

is

significant

if it equals or exceeds the levels specified in

the following table:

SIGNIFICANCE LEVELS

Pollutant

Annual

24-Hour

8—Hour

3—Hour

1—Hour

SO

1.0 ug/m~

5 ug/m~

25 ug/m3

TS~

1.0 ug/m3

5

ug/m

NO2

1.0 ug/m

3

CO

0.5 mg/rn

2

mg/rn

47-85

---

28

b)

The

applicant shall analyze the air quality impacts

resulting from trades between emission sources, in-

cluding the impact of emissions which differ

in their

qualitative impact on health or the environment.

c)

The analysis shall describe any other impacts on the

environment which may accompany the proposed ACS.

Section 212.113

~sofMthodsq~~irinCornj~1iance

A permit application under this subpart shall provide a com-

parison of the methods of assuring compliance under existing

requirements and the methods of assuring compliance which would

be used under the proposed ACS.

As a minimum,

the analysis

shall address the effectiveness, reliability,

and accessibility

of

these

methods,

Section 212.120

Standards for Issuance

The Agency

shall issue

a permit containing an ACS

if,

and only

if, the permit applicant demonstrates that:

a)

The

ACS provides,

in the aggregate with respect to

each

regulated pollutant,

equivalent or less total

emissions

than would otherwise be required.

h)

The

impact

of

the

ACS

is

environmentally

equivalent

to that

which would otherwise be achieved and main-

tained under existing requirements.

c)

The

methods for assuring compliance with

the

condi-

tions

and

requirements of the permit under the ACS

are

equivalent

to those that are

associated

with

otherwise

applicable requirements.

d)

The ACS

complies with any applicable requirements

contained in Parts IX,

X, or XI of this chapter.

e)

U.S.

EPA has not disapproved the proposed ACS or

any compliance schedule it may contain due to the

existence of

a federal enforcement action pending

against a participant

in the ACS,

Section 212.125

__________

The initial issuance of a permit containing an ACS shall be

subject to applicable

Agency public participation procedures

prior to issuance,

At a minimum,

the Agency shall provide an

opportunity for

public comment,

47-86

---

29

Section 212.130

çp~anc~~s

a)

No owner or operator subject to a permit utilizing

an Alternative

Control Strategy is

relieved of the

responsibility for achieving and maintaining a re-

duction of emissions as expeditiously as

practicable,

but

not

later

than the

compliance

date

required

under

other applicable

regulations.

b)

Notwithstanding

subsection

(a),

an

owner

or

operator

may demonstrate

compliance with Rule 205 of this

Chapter pursuant to an Agency—approved alternative

compliance plan contained in a permit utilizing an

Alternative Control Strategy which is applied for

prior to December 31,

1982,

The Agency shall approve

such an alternative compliance plan if, and only if,

the applicant demonstrates that:

1)

the alternative compliance plan extends the com-

pliance date for each emission source subject

to the ACS no longer than necessary to enable

that emission source to utilize the ACS, but

in no case later than December 31,

1987;

3)

the emission source belongs to a

category

of

emission sources having

a compliance date

of

December 31,

1982 or later under Rule 205;

3)

the use of an ACS will result

in either greater

or faster overall emission reductions than would

otherwise be achieved; and

4)

such extension

is consistent with the require-

ments of the federal Clean Air Act,

as amended

in 1977,

Section 212.140

Records_and R~p~rts

a)

The Agency shall require that a permittee operating

under an ACS maintain such records as necessary to

determine compliance with the requirements of the ACS.

1)

These records shall include, but not be limited

to

the

actual and allowable emission

rates,

or

the

parameters

from

which

these

rates

are

determined or

related

operational

parameters

of

the equipment.

2)

The

records shall be maintained as precribed in

the permit.

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30

3)

These

records shall he available to the Agency

and copies of these records shall be sent to

the Agency upon written request.

The Agency

shall make such records available to the public

pursuant to Sections

7 and 7.1 of the Act and

regulations promulgated hereunder,

b)

A permittee operating under an ACS shall submit to

the Agency

reports containing such reasonable infor-

mation and at such reasonable frequency as the Agency

may specify pursuant to a condition of a permit or

general procedures

established by the Agency,

to

assure that the terms

of the ACS are met.

c)

A permittee operating under an ACS shall notify the

Agency within 72 hours

by telephone or telegram of

circumstances, which will

make

compliance

with

the

requirements of the ACS impossible.

1)

This

notice

shall

be

followed

within

ten

days

by written

confirmation which describes the cir-

cumstances which prevent compliance with the re-

quirements of the ACS and supplies

a preliminary

Compliance Program which will result in com-

pliance

with

this

Chapter.

2)

The

permittee shall take all reasonable steps

to come into

compliance with the ACS or this

Chapter as expeditiously as possible.

Section 212.145

Duration

A permit containing an

ACS shall

be issued for no longer than

five years, or for such

shorter period as the Agency may specify

as necessary for

periodic review of the ACS or to accomplish the

purposes of the Act or of

this Chapter.

However,

an ACS permit

may not be issued for a period extending beyond the useful life

of

an

emission

source

which contributes an emission reduction

to

the

ACS.

The

burden

of proving the useful life of the

emission source is

on the applicant.

Section 212.150

Permit Conditions

a)

The permit

shall specify:

1)

All emission limits which apply to emission

sources

under the ACS,

and

2)

Any

compliance

procedures

which

shall

be

followed

by the permittee.

47-88

---

31

b)

The

permit

may

be

conditioned

so

that

compliance

with

the terms of the ACS will continue

in the event of

change

of

ownership

of

emission

sources,

and

such

terms will be made applicable to the new owner.

c)

The Agency may impose such other permit conditions

in

a permit as are necessary to accomplish the purposes

of the Act or of this Part.

Section 212.155

Monitoring and Testing

The Agency may require that equipment testing and monitoring,

as

authorized elsewhere

in

this chapter, accompany the construction

or operation of emission sources under a permit containing an ACS.

Section

212.157

Notification

to U.S.

EPA

The Agency shall

notify

ri.S. EPA of emission limitations,

alternative compliance plans,

and any other permit conditions

applicable to emission sources under an ACS.

Section 212.160

Revision

a)

Timing

1)

An

application

for

revision

of

a

permit

containing

an ACS shall be submitted at least

180 days prior

to the date on which the revision is required to

go into effect,

2)

If the standard under this Chapter for an emission

source included in the ACS is changed and a revised

ACS is being proposed, an application for revision

of a permit containing the ACS shall he submitted

at least 90 days prior to the date a Compliance

Plan must be submitted.

b)

The applicant shall submit the information specified

in Section

212.110

which

is

necessary

to

show

that

the

revised ACS will meet

the standards of permit issuance

specified in Section 212,120.

c)

Unless the Agency

finds that the proposed revisions to

the ACS are not substantive in nature and do not alter

fundamental details of the ACS which was approved under

the prior permit,

issuance of the revised permit shall

be subject to public participation pursuant to Section

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---

32

Section 212.165

Renewal

a)

An

application for renewal

of a permit containing an

ACS

shall be submitted at least 180 days prior

to the

expiration of the previous permit.

b)

Applications for renewal shall contain the

information

specified in Section 212.110.

However,

an analysis

of the

effect of the ACS on air quality pursuant

to

Section

212.112 need be provided

only if:

1)

The other information submitted pursuant to this

Subsection is different from the information upon

which the permit was previously issued, and

2)

the differences may significantly affect air

quality.

c)

Unless the Agency finds that changes in the applica-

tion are not substantive in nature and

do not alter

fundamental details of the ACS which was approved

under the prior permit, renewal of the permit shall

be subject to public participation pursuant to

Section 212.125.

Section 212.190

Severability

Notwithstanding Rule 113 of this Chapter,

if any provision of

Part 212 is stayed or declared invalid by a final order, no

longer subject to appeal, of any court of competent jurisdic-

tion, then the entirety of Part 212 shall be deemed stayed or

invalidated until the stay is lifted or the Board acts to

revalidate the Part,

SUBPART B:

ALTERNATIVE CONTROL STRATEGIES INVOLVING MORE THAN

ONE PERSON

Section 212.201

1~g~i1it

Persons who propose or participate in a multi—person ACS shall

be subject to the rules found in Subparts

A and B of this Part.

Section 212.202

Permit~pp~ication

In addition to the information required in Section 212.110,

persons who propose a multi—person ACS shall:

a)

Identify the persons having ownership and control

of

the emission sources to be included in the ACS.

b)

Provide

a written agreement showing the participants’

intent to pursue the multi-person ACS and to be jointly

bound by the terms and conditions of any permits which

are issued pursuant to the application.

47-90

---

33

Section 212.204

Duration

Al.

permits

issued

under

a

multi-person

ACS

shall

have

the

same

expiration date.

Section 212.206

Permit Conditions

Each participant in a multi-person ACS shall be issued an

individual permit which shall be conditioned on the continuing

compliance

of

the

other

participants

with

the

limitations

in

their permits.

Section 212.208

Records and Reports

All records and reports of the participants in a multi-person

ACS which are not confidential in nature shall be available for

inspection to the other participants upon reasonable notice

of

a

request

to

inspect.

Section 212.210

Revocation

Permit revocation or other sanctions may be initiated before

the Board against any and all persons

in the multi-person ACS,

regardless of the ownership and control of the emission source

at which the violations occurred or any contracts or other

Section 212.211

Termination

a)

If a participant in a multi-person ACS intends to

terminate involvement

in the ACS, it shall give

written notice to the Agency and the other partici-

pants

in the ACS at least 180 days prior to the

anticipated termination date.

b)

If the ACS will not meet the standards of issuance

with only the remaining participants, they may:

1)

Propose a revised ACS to include the remaining

sources and persons; this proposal shall he

submitted to the Agency at least

120 days before

new permits are required;

or

2)

Apply for revised permits, pursuant to the other-

wise applicable regulations in this Chapter; such

applications shall be submitted at least 90 days

c)

If the notice of termination of the multi-person ACS

does not allow sufficient time to meet the time periods

in Subsection 212.211(b)

above, the participants may

seek variance relief from the Board from the require-

47-91

---

34

IT IS SO ORDERED.

I, Christan L.

Moffett, Clerk of the Illinois Pollution

Control

Board, here~ycertify that the above Opinion and Order weçe adopted

on the

4~2~’

day of

______________,

1982 by a vote of

~

Christan

L.

Moffett’,

C

k

Illinois

Pollution

ol

Board

47-92