BEFORE
THE ILLINOIS POLLUTION CONTROL
BOARD
IN THE MATTER OF:
SECTION 27 PROPOSED RULES
FOR
NITROGEN OXIDE (NOx)
EMISSIONS
FROM STATIONARY
RECIPROCATING
INTERNAL
COMBUSTION ENGINES
AND
TURBINES:
AMENDMENTS TO 35
ILL.
ADM. CODE PARTS 211 AND
217
R
07-19
(Rulemaking - Air)
NOTICE OF FILING
TO: Mr. John Therriault
Assistant Clerk of the
Board
Illinois Pollution
Control Board
100 West
Randolph Street
Suite 11-500
Chicago, Illinois 60601
(VIA ELECTRONIC
FILING)
Mr. Tim Fox
Hearing Officer
Illinois
Pollution Control Board
100 West Randolph Street
Suite 11-500
Chicago, Illinois 60601
(VIA ELECTRONIC
MAIL)
(SEE
PERSONS ON ATTACHED SERVICE
LIST)
PLEASE TAKE NOTICE that
I have today filed with the Office of
the
Clerk
of the
Illinois Pollution Control
Board the PRE-FILED TESTIMONY OF
DEIRDRE K.
HIRNER, copies of which
are herewith served upon you.
R espectfully
submitted,
ILLINOIS ENVIRONMENTAL
REGULATORY GROUP,
By: /s/ N. LaDonna Driver
N. LaDonna
Driver
Dated: March
26, 2008
N. LaDonna Driver
HODGE DWYER ZEMAN
3150 Roland Avenue
P ost Office Box
5776
Springfield,
Illinois 62705-5776
(217) 523-4900
T HIS FILING SUBMITTED ON RECYCLED
PAPER
Electronic Filing - Received, Clerk's Office, March 26, 2008
CERTIFICATE OF SERVICE
1, N. LaDonna
Driver, the undersigned, hereby certify that I have served the attached
PRE-FILED TESTIMONY OF DEIRDRE K. HIRNER upon:
Mr. John Therriault
Assistant Clerk of the Board
Illinois Pollution Control Board
100 West Randolph Street
Suite 11-500
Chicago,
Illinois 60601
via electronic filing and by depositing said documents
in
the United
prepaid, in Springfield,
Illinois, on March 26, 2008; and upon:
Mr. Tim Fox
Hearing Officer
Illinois Pollution Control Board
100 West Randolph Street
Suite
11-500
Chicago, Illinois 60601
Rachel L. Doctors, Esq.
Illinois
Environmental
Protection Agency
1021 North Grand Avenue East
Post Office Box 19276
Springfield, Illinois 62794-9276
States
Mail, postage
Renee
Cipriano, Esq.
Kathleen C. Bassi, Esq.
Joshua R. More, Esq.
Stephen J. Bonebrake, Esq.
Schiff Hardin, LLP
6600 Sears
Tower
233 South Wacker Drive
Chicago, Illinois 60606-6473
v ia electronic mail on March 26, 2008.
/s/ N. LaDonna Driver
N. LaDonna Driver
1ERG:001/Fil/NOF-COS- Subpart Q - Hirner Testimony
Electronic Filing - Received, Clerk's Office, March 26, 2008
BEFORE
THE ILLINOIS POLLUTION CONTROL
BOARD
IN THE MATTER OF:
SECTION 27 PROPOSED
RULES FOR
NITROGEN OXIDE
(NOx) EMISSIONS
FROM STATIONARY
RECIPROCATING
INTERNAL COMBUSTION ENGINES
AND
TURBINES: AMENDMENTS
TO 35 ILL.
ADM. CODE PARTS
211 AND 217
R07-19
(Rulemaking - Air)
PRE-FILED TESTIMONY OF DEIRDRE
K. HIRNER
NOW COMES the Illinois
Environmental Regulatory Group ("IERG"),
by one of its
attorneys, N.
LaDonna Driver of HODGE DWYER
ZEMAN, and submits the following pre-
filed testimony of Deirdre K. Hirner
for presentation at the April 9, 2008,
hearing scheduled
in the above-referenced
matter:
Testimony
of Deirdre K. Hirner
My name is Deirdre
K. Hirner and I am the Executive
Director of IERG. I am here
today to provide
information on the Proposed
Rule, with respect to IERG and its members.
IERG is a not-for-profit Illinois corporation
affiliated with the Illinois State Chamber of
Commerce. IERG
is composed of 55 member companies
that are regulated by governmental
agencies that promulgate, administer
or enforce environmental laws, regulations,
rules or
other policies. On behalf
of its member companies, IERG
has attended outreach meetings,
reviewed drafts of the Proposed Rule, provided
comments to Illinois Environmental
Protection Agency ("Illinois EPA")
on drafts of the Proposed Rule and
participated in Illinois
Pollution Control
Board ("Board") proceedings in this
matter, and in R07-18. IERG
appreciates the opportunity to participate
in this rulemaking and offers these comments
for
consideration by the
Board.
Electronic Filing - Received, Clerk's Office, March 26, 2008
IERG has been
working with Illinois EPA on this Proposed Rule since 2005. From
the beginning, our members expressed concern about many aspects of the
Proposed Rule.
The forerunner of this Proposed
Rule was part of R07-18, until the Board split the docket to
deal solely with the NOx SIP Call Phase II units in R07-18 and
non-Phase II
units
in this
proceeding. We appreciate the Board's approach
in that regard, which allowed the parties
(including some of
our members) to expeditiously deal with the SIP Call units
in R07-18.
The splitting of the docket also allowed the parties
to take the time to address
remaining issues
with this Proposed Rule. As I will outline in my testimony, IERG's most
significant concerns with the Proposed Rule have ultimately been
addressed by Illinois EPA,
primarily by providing multiple options for compliance.
As regulators impose more and
more emission control
requirements, each targeted source must be able to evaluate and
implement a compliance strategy that is technically and economically
practical for that
particular source.
With this in mind, IERG has advocated a reasonable and multi-faceted
regulatory strategy, which also provides
the emissions control results sought by Illinois EPA.
Subpart Q Concerns and Solutions
As mentioned previously, IERG has worked with Illinois EPA to address
several
issues with the Proposed Rule. These issues center primarily on the
coverage or scope of the
Proposed Rule, and
its
substantive
requirements. In addition, IERG has worked with Illinois
EPA to clarify an issue that would affect permitting of
future projects.
Electronic Filing - Received, Clerk's Office, March 26, 2008
Scope
One example of
IERG's concerns with the Proposed
Rule's coverage is that the
original applicability
provisions would have imposed
the Proposed Rule's requirements on
an unknown universe of engines
and turbines, as the rating levels at
proposed Section
217.386(a) are
lower than those for permit exemptions
at 35 111. Admin. Code 201.146(i).
Illinois EPA's latest version (December
2007) of the Proposed Rule lessens this concern
by
adding an applicability
criterion that the Proposed Rule will only
apply to major sources of
NOx. Presumably, engines and turbines that the Proposed
Rule would cover are already
referenced in Title V permits,
either as significant emission units or insignificant
activities.
This provides
more certainty to the reach of this
rulemaking.
We are also pleased to see
that in the December 2007 version of the
Proposed Rule,
Illinois EPA
has focused the rule's applicability
in the ozone and PM2.5 nonattainment areas.
IERG has long advocated this approach
and it is supported by NOx emissions
modeling, as
discussed in Illinois EPA's
December 2007 submittal.
We
would point out that Attachment A to
Illinois EPA's December 2007 submittal
purports to list engines and turbines
in the nonattainment areas "that have the potential
to be
affected by the
proposed regulation." See Amended
Technical Support Document for R07-
19, at page 38. IERG has nonattainment
area members with units that will be affected
by this
Proposed Rule, yet
these units are not listed in Attachment
A. Therefore, while IERG
believes, for the most part, that the
current approach in the Proposed Rule language for
coverage of Subpart Q is acceptable,
IERG does not believe that
the Amended Technical
Support
Document provides correct information
regarding the applicability of the Proposed
Rule.
Electronic Filing - Received, Clerk's Office, March 26, 2008
Compliance
Another issue for
our
members has been the emission concentration
limits proposed
b y
Illinois EPA in this rulemaking.
We have questioned whether these limits are appropriate
from a reasonable control
perspective, both in terms of feasibility and economics. Over the
course of our discussions regarding this rulemaking,
Illinois EPA has incorporated certain
compliance options into the
Proposed Rule that will help our members who would find it
difficult
to comply with the proposed emission concentration limits on a unit-by-unit
basis.
One compliance option
is the low use concept at proposed Section 217.388(c). Under
that provision,
sources can limit the annual NOx emissions or annual operating hours of
engines or turbines that would otherwise
have to comply with the Proposed Rule's emission
limits. This provision
will be particularly useful to our industrial members who employ
engine-driven electric generators. Because such units typically operate only on an as-needed
basis, our members believe that
retrofitting these types of units with controls is not practical
or cost
effective.
Another useful addition
to the Proposed Rule is that of averaging plans at Section
217.390.
This compliance option allows sources to decide which emission units are the
most
effective to control, thus allowing over-compliant
units to offset emissions from units that are
not effective
to control. We are particularly pleased to see, in the December 2007 version of
the
Proposed Rule, that averaging plans will be able to span across different Subparts of Part
217 (see proposed Section 217.388(b)(2)).
This will be helpful to our members that may not
be able
to utilize averaging among Subpart Q units alone, but could achieve compliance for
Subpart Q units by averaging with emission
units affected by other Part 217 provisions.
Electronic Filing - Received, Clerk's Office, March 26, 2008
One other important component to the Proposed Rule is the ability to
utilize
NOx
allowances to compensate for infrequent circumstances
of noncompliance
(see
proposed
Section 217.392(c)). Sources may utilize this provision for complying with emission
concentration limits, averaging plan requirements and/or
low usage
designations.
This aspect
of the Proposed Rule provides a critical complement to the compliance options in the
Proposed Rule, particularly given the stringency of the limits in the Proposed Rule. IERG
supports the ability
for regulated sources to utilize the emissions marketplace when
compliance difficulties arise. Such an approach is beneficial to the environment as well, as
NOx emission allowances, in an amount equivalent to the compliance excursion, would be
retired from the allowance pool.
Permitting
Units
that are affected by this Proposed Rule would have a compliance date of May 1,
2010 (see proposed Section 217.392(b)). As discussed previously, sources will have until
that time to implement one of the Proposed Rule's three compliance options for each affected
unit. In the meantime, sources may have already implemented or may be implementing
emission reductions at units that would be affected by the Proposed Rule. Reasons for such
reductions may involve a larger decision across the source to target reductions in
one area
in
order to offset additional NOx emissions that may be planned in another area, which is often
referred to as "netting." Similarly, sources may decide to reduce their
own emissions in
order to sell emission reduction credits as "offsets" so that another source may add NOx
emissions.
In both the netting and offset scenarios, construction permitting is typically involved
in order to recognize the creditable emissions decreases and their use for the corresponding
Electronic Filing - Received, Clerk's Office, March 26, 2008
emissions increases.
IERG is concerned that such permitting could be occurring, or
has
occurred in the past, that would rely upon
NOx emissions reductions at units that would now
be subject to the Proposed
Rule.
As an example, consider a diesel engine that previously did
not
emit NOx
at
or
below
660 ppm. The source decides to control
the NOx emissions from the engine in order to
utilize the NOx emission
reductions to net against emissions increases at another emission
unit. Then, when the Proposed Rule's compliance
date arrives, and the controlled engine is
complying with the 660 ppm
NOx emission limit, there could be some question as to whether
the reduction was creditable for purposes of the prior permitting,
due to the requirements and
purposes of the
Proposed Rule (see, e.g., 35 Ill. Admin. Code 203.208(c)(4)). In order to
prevent such a possible conflict, IERG proposes the addition of the following provision as a
new subsection (e) in the Applicability provisions of Section
217.386:
Where a construction
permit, for which the application was submitted to the
Agency prior to the adoption of this Subpart, is issued that relies on decreases
in emissions of NOx from existing emission units for purposes of netting or
emission offsets, such NOx decreases shall remain creditable
notwithstanding
any requirements
that may apply to the existing emissions units pursuant to
this Subpart.
Illinois EPA has informed us that they concur with
this addition to the Proposed Rule,
in order to provide
certainty in past, current and future permitting decisions.
Conclusion
IERG has members that own and operate engines
and turbines that will be affected by
this
rulemaking in different ways. Some members' affected units operate relatively
sporadically, such that the low usage compliance option will be the preferred approach.
Some
members' units operate as integral parts of the industrial process and cannot be limited
by the low usage option, but will either
have
to
comply with the emission concentration
Electronic Filing - Received, Clerk's Office, March 26, 2008
limits or utilize an averaging plan. Due to the diversity of
covered
units
and operating needs
for
those
units, the Proposed Rule must provide flexibility in compliance alternatives. We
believe that the Proposed Rule, as currently situated, provides such flexibility, including the
ability to utilize NOx allowances. These components of the Proposed Rule are vitally
important, as is the current approach as to applicability
for major sources
of
NOx emissions
in the ozone and
PM2.5 nonattainment areas.
I appreciate the opportunity to share IERG's comments on this Proposed Rule. I
would be happy to answer questions regarding my testimony.
IERG reserves the right to supplement this pre-filed testimony.
Respectfully submitted,
By: /s/ N. LaDonna Driver
N. LaDonna Driver
Dated: March 26, 2008
N. LaDonna
Driver
HODGE DWYER ZEMAN
3150 Roland Avenue
Post Office Box 5776
Springfield, Illinois 62705-5776
(217) 523-4900
I ERG:001/Fil/Subpart Q - Himer Testimony
Electronic Filing - Received, Clerk's Office, March 26, 2008
