FIRST DRAFT 2/5/08 (NJM/kmc)

ILLINOIS POLLUTION CONTROL BOARD

ILLINOIS POLLUTION CONTROL BOARD

October 15, 2009

EMERALD PERFORMANCE MATERIALS,

L.L.C. (as purchaser of NOVEON, INC.),

Petitioner,

ILLINOIS ENVIRONMENTAL

(CAAPP Permit Appeal)

ROY M. HARSCH AND LAWRENCE W. FALBE, DRINKER BIDDLE & REATH LLP,

APPEARED ON BEHALF OF PETITIONER, AND

ROBB H. LAYMAN AND SALLY A. CARTER APPEARED ON BEHALF OF

RESPONDENT.

OPINION AND ORDER OF THE BOARD (by S.D. Lin):

This case involves a petition for review of a permit issued November 24, 2003, by the

Illinois Environmental Protection Agency (IEPA or Agency) under the Clean Air Act Permit

Program (CAAPP). The permit was issued for a petrochemical manufacturing plant, which

received its first air permit in 1975, located at 1550 County Road, 1450N in Henry, Illinois

(Henry plant). At the time of permit issuance, the Henry plant’s owner was Noveon, Inc.; as of

May 2006, the owner was Emerald Performance Materials, LLC. Emerald, as current owner,

challenges a condition contained in the CAAPP permit stating the applicability to the Henry

plant of the 2,000 parts per million (ppm) emission limit for sulfur dioxide (SO

) set out in 35 Ill.

Adm. Code 214.301.

The Agency issued the CAAPP permit under Section 39.5 of the Illinois Environmental

Protection Act (Act), and the Board heard this appeal under the authority of Section 40.2 of the

Act. 415 ILCS 5.39.5 and 40.2 (2008).

The Board held a hearing on this matter on February 5,

2008.

As the provisions of the Act have not materially changed since 2005, the Board will cite to the

2008 edition of the Illinois Compiled Statutes (ILCS).

The hearing made clear that there is no real factual dispute here, but rather a question of

application of law to agreed facts. Following hearing and prior to briefing, the Board granted the

parties’ request to dismiss four of the six issues originally presented in this appeal. Emerald

Performance Materials, LLC (as purchaser of Noveon, Inc. v. IEPA, PCB 04-102 (Feb. 7,

The transcript of the February 5, 2008 will be cited as “Tr.”.

2008).

The parties narrowed the disputed issues to: whether certain of the plant’s condensers

are subject to 35 Ill. Adm. Code 214.301 or whether instead they are covered by the “SO

exception” found in 35 Ill. Adm. Code 214.382, on the grounds that they are existing processes

“designed to remove sulfur compounds from the flue gases of petrochemical processes” within

the meaning of 35 Ill. Adm. Code 214.382. Emerald believes that the SO

exception is

applicable. The Agency believes that the exception does not presently apply to Emerald, while

acknowledging that Emerald’s permits issued between 1975 and 1993 stated that the SO

exception applied to the Henry plant.

For the reasons stated below, the Board finds that Emerald’s condensers qualify for the

exception in 35 Ill. Adm. Code 214.382. The Board accordingly finds that the Agency

improperly included the condition concerning applicability of 35 Ill. Adm. Code 214.301, and

remands the permit for re-issuance of the permit consistent with the Board’s findings in this

opinion and order.

FACTS

The Facility

Emerald’s facility (Facility) is a petrochemical manufacturing plant located at 1550

County Road, 1450 N in Henry, Illinois (Facility ID No. 123803AAD). The Facility currently

manufactures organic chemicals, specifically antioxidants and accelerators to be used in the

manufacture of rubber and plastics, coatings used in the electronics industry and personal care

products used for personal hygiene such as hair conditioners. Tr. at 14. The Facility houses

storage tanks for raw material, intermediates and finished products and operates a wastewater

treatment facility and a small process fluid heater for process heat.

The Henry plant received its first air permit in 1975. Until the November 24, 2003

issuance of the CAAPP permit Emerald appeals here, Emerald’s permits have recognized the

facility as eligible for the SO

exception found in 35 Ill. Adm. Code 214.382. At issue in this

proceeding is a product and process of the polymer chemicals portion of the Henry plant. That

product is called sodium mercaptobenzothiazole (MBT), one of the plant’s primary products

since 1972. Tr. at 14. Sodium MBT is the intermediate the plant uses to make accelerators used

in the process of tire manufacture. Tr. at 15. Mr. David Giffin is now Health and Safety

Environmental Manager of the Henry Plant, but began working at the plant in 1967 as an

associate engineer in the plant’s polymer chemicals area. Tr. at 9-10. Mr. Giffin explained that

In the same order, the Board granted the agreed motion to change petitioner’s name from

Noveon, Inc. to Emerald. Consistent with the naming convention used by the parties in their

briefs, to avoid confusion, all references in this opinion and order to Emerald/Noveon will be to

“petitioner” or “Emerald”, regardless of the actual name of the company at the time of the facts

being related.

See, e.g

. Pet. Post-Hearing Memo. at 1, n.1, and IEPA Post-Hearing Br. at 1, n.1.

The Henry plant’s original owner was B. F. Goodrich. Successor owners of the polymer

chemicals portion of the plant included AEA Investors, Noveon, Luberzol, Sun Capitol, and

finally Emerald. Tr. at 12-13.

The accelerators that we make are what we call the salt and pepper chemicals that

go into the master batch of rubber. And most of the rubber goes into the

manufacturing of tires. If you didn't put the accelerator into the master batch, a

small amount of it, it would take a long time for the rubber to cure. And so when

you make a tire, if you didn't have that accelerator in the rubber, it would take

maybe a couple hours to cure rather than maybe 30 minutes. So, basically, what

it boils down to that everybody's tires here are less expensive because they use

accelerators in the product.

* * *

And so for tires . . . by adding the antioxidant into the rubber batch, it will extend

the life of the tire because the tire is subject to heat and other forces to break

down the rubber. The antioxidant prevents that breakdown, and it make the tire

last longer. And, again, it gets back to giving you more miles to the tires that you

purchase. Tr. at 14-15.

At the time of hearing, Emerald’s Henry plant was the sole manufacturer of sodium MBT for

accelerators in the United States, having outlived a number of domestic competitors who were

not able to compete with Asian producers. Tr. at 21. Moreover, Emerald is the sole supplier to

the North American market; Mr. Giffin explained that “the tire company will purchase it from us

[at Emerald], or they will bring it in from Asia.” Tr. at 23.

The following is a brief overview of the Emerald production process

at issue here. This

discussion is intended to render later discussion of hearing testimony more meaningful;

additional detail will be provided later in the synopsis of testimony. Emerald’s process has

remained unchanged since the 1970’s, except for addition of the sodium hydrosulfide (NaSH)

system added within the last 3 1/2 years. Emerald maintains the workings of its process as a

trade secret, including during the permit process before the Agency and the appeal process

before the Board.

The first part of the process of creating the finished accelerators is the MBT crude (or

MBT-C) creation process. The MBT-C reactor and its condensers was one of the Henry

facility’s original processes, built in 1958 or 1959. Tr. at 54. The process utilizes three

The process as described verbally in the record is also portrayed in the record as a schematic.

See

TSR 141, also admitted at hearing as petitioner’s exhibit 3 and marked as a trade secret by

the hearing officer.

There were two records compiled by IEPA for the permit appeal; one was composed of

documents for which Petitioner claimed trade secret protection, and the other was an unprotected

“public” record. The Board has maintained the trade secret protection of the materials filed as

trade secret, and here notes that there have been no requests to review the protected materials.

Citations to the Trade Secret Record will be to “TSR”, and citations to the public record will be

to “R.” The schematic for the process described above is found in the record at TSR 141 and

Pet. Exh. 3 (also protected as trade secret).

chemicals: aniline, sulfur, and carbon disulfide (CS

). Tr. at 16. The chemicals are charged to

three high pressure reactors. The reactor is heated to about 500 degrees Fahrenheit, using

dotherm as the heating medium. The reactor reaches temperature, creating pressure in excess of

1,000 pounds per square inch gauge (psig). There is a condenser on each of the reactors which

Emerald classifies as its “sulfur reducing device”. Tr. at 18.

The “support system” to the sulfur reducing device is a high pressure control valve, an

additional steam condenser, and a tank that controls the level that is in the condenser. Once the

reaction begins, it generates hydrogen sulfide (H

S) and vaporizes some of the CS

in the reactor.

The condenser returns the CS

to the reaction. The high pressure valve controls it and releases the

S into blowdown tanks. Tr. at 18. The system reduces the pressure from 1,000 psig to about

50 psig in the blowdown tank. The contents are transferred to the flare, which further reduces

pressure before it is converted to SO

. Tr. at 19.

Finished molten product is then transferred from the reactor to the “MBT crude

blowdown tanks”, which transfers the product into later portions of the process that convert it

into a water soluble organic material. Tr. at 15-17.

Gases generated during the reaction and blowdown enter the MBT blowdown tanks,

which are vented on a controlled basis to a flare system incorporating a vaporizer. Vapor is

converted from H

S and some residual CS

into SO

. Tr. at 17-18.

In 2006, Emerald installed and began to operate its NaSH system.

Instead of sending

gases to the flare, Emerald propels it to the NaSH system, which recovers the CS

that remains

after the reaction through a column system. Emerald returns that CS

to the process, recharging it

back into the reactors at a later time. Tr. at 19.

The H

S gas that goes with the CS

continues on through the NaSH system. The H

S is

purified, and then reacted in the NaSH distillation column. Emerald combines the H

S and a

caustic solution to form a liquid with a NaSH concentration of 45-47%. Tr. at 20. Following the

distillation column, there is a NaSH scrubber. Emerald states that after gases are scrubbed in it,

the system emits less than 50 ppm of H

Id.

at 21.

As to the reason for its installation of the NaSH system, in its opening brief, Emerald explains

that:

While the installation of the NaSH unit brings the Facility into compliance with

the applicable air regulations even without the application of the SO

exception,

Petitioner has never abandoned its legal position that it is entitled to the SO

exception, and has valid reasons for continuing this appeal. (Testimony of D.

Giffin, [Tr. at ] 41:24-42:2; 46:13-47:7). Among other reasons, Petitioner has

voluntarily complied with the SO2 limitation so that, if its appeal is successful, it

will be able to market SO

reduction credits. Petitioner also intends to seek

modification of its construction permit for the NaSH system so that it can utilize

its flare as its NESHAP [National Emission Standards for Hazardous Air

Pollutants;

see

415 ILCS 5/9.1(2008)] control device for periods when the NaSH

system is inoperable. (

Id.

) Pet. Opening Brief at 6, n.4.

Emerald stores the NaSH in a storage tank, and ships the liquid product via truck to

various customers for the product. One customer set include tanneries, which use Emerald’s

high quality NaSH product to tan leather. Another customer set is the ore mining industry, which

uses NaSH to recover metals from ores. Tr. at 20.

REGULATORY AND LEGAL BACKGROUND

Applicable Rules

35 Ill. Adm. Code 214.301 provides in its entirety that

Except as further provided by this Part, no person shall cause or allow the

emission of sulfur dioxide into the atmosphere from any process emission source

to exceed 2,000 ppm.

35 Ill. Adm. Code 214.382(a) provides in its entirety that

Section 214.301 shall not apply to existing processes designed to remove sulfur

compounds from the flue gases of petroleum and petrochemical processes.

Legal Framework

Under the Act (415 ILCS 5 (2008)), IEPA is the permitting authority. The Agency has

general permitting authority under Section 39(a), and specific CAAPP permitting authority under

Section 39.5.

See

415 ILCS 5/39(a) and 39.5(3) (2008). The Act requires IEPA to issue a permit

if the permit applicant proves that the requested permit will not cause a violation of the Act or

the Board’s regulations.

Id.

If IEPA denies a requested permit, the applicant may appeal IEPA’s

decision to the Board within 35 days; permits issued by the Agency under Section 39(a) are

appealable to the Board under Section 40(a)(1) of the Act, while permits issued under Section

39.5(3) are appealable under Section 40.2.

See

415 ILCS 5/40(a)(1) (2008) and implementing

procedural regulations at 35 Ill. Adm. Code 105.Subpart B and 415 ILCS 5/40.2(a) and

implementing procedural rules at 35 Ill. Adm. Code 105.Subpart C.

“[T]he Board is not required to apply the manifest-weight test to its review of the Agency’s

decision denying a permit.” See

Peoria Disposal Co. v. Illinois Environmental Protection Agency,

PCB 08-25, slip. op. at 23 (January 10, 2008),

affd. sub nom

Peoria Disposal Company v.

Illinois Pollution Control Board and Illinois Environmental Protection Agency, No. 3-08-0030

(Third Dist. Jan. 20, 2009) (Rule 23 order) (hereinafter Peoria Disposal, PCB 08-25) quoting

from IEPA v. PCB, 115 Ill. 2d 65, 70, 503 N.E.2d 343, 345 (1986). The petitioner has the

burden of proof on appeal.

See

415 ILCS 5/40(a)(1) (2008); 35 Ill. Adm. Code 105.112.

The Board’s review of permit appeals is generally limited to information before IEPA

during IEPA’s statutory review period, and is not based on information developed by the permit

applicant or IEPA after IEPA’s decision. Alton Packaging, 162 Ill. App. 3d at 738, 516 N.E.2d

at 280; Panhandle, PCB 98-102, slip op. at 2; American Waste Processing v. IEPA, PCB 91-38,

slip op. at 2 (Oct. 1, 1992). However, it is the proceeding before the Board that affords the

petitioner the opportunity to challenge the information relied upon by, and the reasons given by,

IEPA for denying the permit. Alton Packaging, 162 Ill. App. 3d at 738, 516 N.E.2d at 280,

citing IEPA v. PCB, 115 Ill. 2d 65, 70, 503 N.E.2d 343, 345 (1986).

On appeal of the IEPA’s denial of a permit, the question before the Board is “whether the

applicant proves that the application, as submitted to the Agency, demonstrated that no violation

of the Act would occur if the permit was granted.” Panhandle Eastern Pipe Line Co. v. IEPA,

PCB 98-102, slip op. at 10 (Jan. 21, 1999),

aff’d sub nom

Panhandle Eastern Pipe Line Co. v.

PCB and IEPA, 314 Ill. App. 3d 296, 734 N.E.2d 18 (4th Dist. 2000), quoting Centralia

Environmental Services, Inc. v. IEPA, PCB 89-170, slip op. at 9 (Oct. 25, 1990);

see also

Browning-Ferris Industries of Illinois, Inc. v. PCB, 179 Ill. App. 3d 598, 601-602, 534 N.E.2d

616, 619 (2d Dist. 1989); Joliet Sand & Gravel Co. v. PCB, 163 Ill. App. 3d 830, 833, 516

N.E.2d 955, 958 (3d Dist. 1987), citing IEPA v. PCB, 118 Ill. App. 3d 772, 455 N.E.2d 188 (1st

Dist. 1983). IEPA’s denial letter frames the issues on appeal.

See

Centralia, PCB 89-170, slip

op. at 8; Pulitzer Community Newspapers, Inc. v. IEPA, PCB 90-142, slip op. at 6 (Dec. 20,

1990).

Permits issued under both Sections 39(a) and 39.5 may each contain conditions.

See

415

ILCS 5/39(a) and 39.5(7) (2008). The applicant may appeal conditions of permits issued under

either section. The courts have held that

To prevail on its claim, petitioner must show the IEPA’s imposed modification

“were not necessary to accomplish the purposes of the Act, or, stated alternatively,

[the petitioner] had to establish that its plan would not result in any future violation

of the Act and the modifications, therefore were arbitrary and unnecessary.”

Browning-Ferris [v. PCB], 179 Ill. App. 3d [598] at 603, 534 N.E. 2d [616] at 620 [2d

Dist. [1989]. IEPA v. Jersey Sanitation Corp., 336 Ill. App. 3d 582, 784 N. E. 2d 867

(4th Dist. 2003).

In this particular case, due to the nature of the condition at issue, the question on review

can be framed as whether the permit should have specified as a condition that the SO

exception

in 35 Ill. Adm. Code 214.382 applies to the Henry plant’s MBT-C process, or whether it in fact

correctly specified that the general 2,000 pm SO

limit applies to the MBT-C process.

PROCEDURAL HISTORY AND PRELIMINARY PROCEDURAL MATTERS

IEPA Permit Process

As previously stated, Emerald received its first permit in 1975. In March, 1996, Emerald

timely applied for a CAAPP permit (sometimes referred to as a Title V permit) for its facility.

TSR 1-2115. IEPA issued a draft CAAPP permit on September 17, 2003. Among other written

comments petitioner made to IEPA on the draft, petitioner claimed applicability of the SO

exception. But, the draft did not recognize applicability of the SO

exception of 35 Ill. Adm.

Code. 214.382.

, and R. at 1253-1267, but esp. 1260.

The Agency’s November 23, 2003 final permit became effective upon issuance. R. 1980-

2070. While IEPA did modify some conditions in response to Emerald’s comments, IEPA did

not make all modifications Emerald requested. Pursuant to the parties’ negotiations, the sole

issue remaining for resolution by the Board concerns the applicability of the SO

exception of 35

Ill. Adm. Code. 214.382.

See, supra

, n.3 at 2.

Various conditions in the final November 23, 2003 CAAPP permit (R. 001144- 001237)

embody the concept.

See

CAAPP permit conditions 4.0 (R. 1154-1157), 7.1.2 (R. 001166-

001167), 7.1.3(d) (R. 001167), 7.1.4 (R001167-68), and 7.1.13 (R001170-001171). Perhaps the

most straightforward articulation is contained in Condition 7.1.3 “Applicability Provision and

Applicable Regulations”. Subsection (d) of Condition 7.1.3 states in its entirety:

Each affected MBT-C reactor/blow down tank system is subject to 35 IAC 214.301.

This rule requires that emissions of sulfur dioxide into the atmosphere from any

Process emission source shall not exceed 2,000 ppm. R. 001167

Board Appeal Process

Petitioner filed its appeal with the Board on December 24, 2003. The parties conducted

negotiations and participated in status conferences with the hearing officer in 2004 through 2007.

With Emerald’s agreement, IEPA filed a partial record on April 27, 2007. Hearing, originally

scheduled for two dates at the end of 2007, was ultimately scheduled and held February 5, 2008

solely on the issue of the applicability of the SO

exception. Emerald filed a motion to

supplement the record on January 24, 2008 over IEPA’s January 29, 2008 opposition. The

hearing officer denied the motion in a February 4, 2008 order. Emerald Performance Materials,

LLC (as purchaser of Noveon, Inc.) v. IEPA, PCB 04-102 (h.o. order Feb. 4, 2008).

The Board Hearing

Board Hearing Officer Bradley P. Halloran presided at the February 5, 2008 hearing, held

in the Council Chambers at the Municipal Building in Henry, Marshall County. The hearing

officer announced that the hearing would be closed to the public, at the parties’ request, due to

the fact that portions of the record under discussion concerned trade secret material. Tr. at 4.

But, the hearing officer also announced that a sign-up sheet was posted outside the door, and that

if any members of the public wished to comment, they could do so at an appropriate point. Tr. at

5. A member of the public who “just wanted to listen” stopped by early in the hearing, but

declined to make a statement either at that point or later. Tr. at 22. At the close of hearing, the

hearing officer noted that no other members of the public had presented themselves at hearing, or

asked to speak. Tr. at 172-173.

The hearing officer admitted as Hearing Officer Exhibit A (HO Exh. A) p

ages 1276

through 1452 of Volume I of the public copy of the IEPA record, filed April 27, 2007. These pages

had not previously been filed by the Agency.

Petitioner Emerald presented three witnesses at hearing:

David Giffin, the health, safety and environmental manager at the Henry Facility. Mr.

Giffin, who had been employed at the Facility for almost 38 years, was the engineer

assigned to the process at issue in this case. Tr. 9-89.

Michael R. Corn, P.E. who was president of AquAeTer, Emerald’s environmental

consulting firm. Mr. Corn had 33 years of experience as an environmental consultant and

first became involved with the Henry Facility in 1988. He and his firm were retained

by Emerald to assist the company in the preparation of its first CAAPP or Title V air

permit in the mid-1990s. Tr. at 65-78, and 161-166.

Bernard O. Evans, who has been employed by Environmental Resources Management

(ERM) since 1988 and has been working with the Henry Facility since 2003. Mr. Evans

had been consulting with industry on air matters for 30 years. He has been working with

the owners of the Henry plant since 1998. Tr. at 79-90 and 166-170.

Petitioner also presented three exhibits: the January 29, 2008 affidavit of IEPA’s Dan Punzak

attesting to the applicability of the SO

exception in IEPA permits for the Henry Facility from at least

1975-1993 (Pet. Exh. 1); a letter dated September 6, 2001, from Bonnie Sawyer of IEPA to Roy

Harsch, responding to Emerald’s Freedom of Information Act (FOIA) request (Pet. Exh. 2); and

Emerald’s Process Schematic (Pet. Exh. 3, marked as a trade secret, previously submitted as TSR

141).

Petitioner also made an offer of proof, designated as Petitioner’s Exhibit A by the hearing

officer when he denied the materials’ admission at hearing.

Tr. 32-33. These materials were those

attached as Exhibit A to Emerald’s motion to supplement the record on January 24, 2008.

Noting, among other things, IEPA’s January 29, 2008 response in opposition, the hearing officer

denied the motion in a February 4, 2008 order. Emerald Performance Materials, LLC (as

purchaser of Noveon, Inc. v. IEPA, PCB 04-102 (ho order Feb. 4, 2008).

The Agency presented one witness in support of its determination that the Henry facility

is no longer eligible for the SO

exception:

Dan Punzak, P.E., an IEPA employee since 1978. Other than a one-year stint as an air

inspector, Mr. Punzak has worked in the air permitting area, working with both

construction and operating permits. Mr. Punzak is currently working with CAAPP

permits in the fields of chemical processes, printing, refineries, and that type of operation.

Mr. Punzak may have inspected the Henry Facility once in 1979 or 1980, but his primary

acquaintance with the Facility and its permits began in 1993. Tr. 91-160.

The Agency presented no hearing exhibits.

While the parties had initially intended to have the entire hearing transcript designated as

a trade secret, on April 23, 2008 the hearing officer granted Emerald’s April 14, 2009 motion to

have the transcript handled as a public document, while still giving trade secret protection to the

process schematic (Pet. Exh. 3). In his May 14, 2008 hearing report, the hearing officer

established a post-hearing briefing schedule.

Pursuant to the schedule as extended by June 11, 2008 hearing officer order, the

petitioner filed its post-hearing memorandum on June 27, 2008 (Pet. Br.). The Agency filed its

66-page post- hearing brief on July 25, 2008 (IEPA Br.), accompanied by a motion for waiver of

page limit requirements (Mot. Waiver) and motion to temporarily seal its brief as trade secret

(Mot. Seal). Petitioner filed its reply brief on August 18, 2008 (Pet. Reply).

Post-hearing Motions

Agency Motions re Briefing

The Board first turns to the Agency’s motions regarding its brief. As to length, IEPA

correctly relates that the Board’s rules provide that briefs are not to exceed 50 pages without

prior approval under 35 Ill. Adm. Code 101.302(k). The Agency comments that the 66 page

length of its brief is “proportional” to the “complexity and potential significance” of the issues.

Mot. Waiver at 2. Emerald has not responded to the motion, except to note the “super-size” of

the IEPA’s brief in its reply brief. Pet. Reply at 1. Under 35 Ill. Adm. Code 101.500(d), the

Board deems Emerald to have waived objection, and grants the Agency’s motion.

The Board next turns to the Agency’s motion to temporarily seal its brief as a trade

secret. The motion is premised upon the Agency’s uncertainty as to what the petitioner does and

does not currently claim as trade secret. To avoid any inadvertent disclosure, the Agency moved

the Board to temporarily consider the entire brief a trade secret until the petitioner had an

opportunity to review it. The Agency suggested that in the event Emerald concluded that any

particular statements could impair its trade secret claims pending before the Agency, the Agency

would provide trade secret and redacted public copies of the brief. Emerald has not responded to

the motion in its reply brief. Pet. Reply at 1.

Under 35 Ill. Adm. Code 101.500(d), the Board deems Emerald to have waived objection

to the material included in the IEPA brief, and denies the Agency motion to seal as unnecessary.

In so ruling, the Board notes that the IEPA brief has been provided trade secret protection during

the pendency of the motion to seal, and the Board will continue to provide the brief such

protection until the time for appeal of this opinion and order has expired.

The Board commends IEPA on its willingness to provide Emerald’s process all due trade

secret protection, and Emerald on its diligence in protecting its trade secrets. But, in this context,

the Board notes that the January 3, 2008 hearing notice did not indicate that the February 5, 2008

hearing would be closed due to trade secret issues. As the existence of trade secret issues was

known early on in this proceeding, the better practice would have been for the parties to make

their desire for a closed hearing known far enough in advance to have allowed the hearing notice

to include that information as well as information regarding notice of opportunities for comment.

Doing so would have minimized inconvenience to members of the public while still protecting

trade secret material.

Emerald Motion for Admission of Petitioner’s Exhibit A

In the closing pages of its opening brief (Pet Br. at 19-27), petitioner requests the Board

to overrule the hearing officer’s order of February 4, 2008 and hearing ruling denying admission

of the documents with which Emerald has sought to supplement the record since April 27, 2007.

The hearing officer’s written order provided in pertinent part that

The Board’s procedural rules require that “[t]he hearing will be based exclusively

on the record before the Agency at the time the permit or decision was issued.” 35

Ill. Adm. Code 105.214(a). Here, the additional documents, dated between 1972

and 1993, involve earlier permit applications that obviously pre-date the filing of

the 1996 permit application under review. The Agency argues that its decision to

include the 2001 memorandum and all accompanying attachments in the record

should not subject the Agency’s CAAPP permit decision to Board review based

on material that not only pre-dates the CAAPP permit application, but only exists

in the files from previous state application submittals and permitting decisions.

The hearing officer finds that the Agency acted properly when it included in the

record the 1993 memoranda attached to the 2001 memorandum.

See

35 Ill. Adm.

Code 105.302(f). The Agency’s actions were also proper when it did not include

in the record any documents referenced in the 1993 memoranda that were not

included in the CAAPP permit file, and the hearing officer will not allow

petitioner to add them to the record.

The petitioner’s reliance on Pease is misplaced. In Pease, the Board granted the

petitioner’s motion to supplement the record with letters generated during the

pendency before the Agency of the mining permit application that was the subject

of the appeal to the Board. Here, the motion to supplement includes documents

from previous permit applications that pre-date the CAAPP application, upon

which the Agency states it did not rely.

Emerald Performance Materials, LLC

(as purchaser of Noveon, Inc. v. IEPA, PCB 04-102, slip op. at 4-5 (ho order Feb.

4, 2008) (footnote 2 indicated after “reply” in original reproduced in footnote 7

below).

Petitioner’s arguments.

Emerald characterizes the documents as ones “that related to IEPA’s

many internal discussions over the years as to whether the Facility was in fact entitled to the SO

exception.” Pet. Br. at 19. These include internal memoranda between various members of the

Agency’s legal staff concerning the issue, which apparently arose in the context of earlier permit

applications in 1973, 1975, 1978, and 1983.

Id.

Emerald also noted that these internal IEPA documents had not been produced in

response to FOIA requests. Pet. Br. at 20. Emerald’s contention is that,

See

Emerald Performance Materials, LLC (as purchaser of Noveon, Inc. v. IEPA, PCB 04-102,

slip op. n. 2 at 4-5 (ho order Feb. 4, 2008), which provides in its entirety:

The hearing officer notes that a recent Board decision underscores that the relevance

to the Board’s decision here of the legal opinions contained in the two1993 Agency

memoranda is questionable.

See

Peoria Disposal Company v. Illinois Environmental

Protection Agency, PCB 08-25, slip op. at 14, n.## (sic) [2] (January 10, 2008) (affirming

Agency permit denial where Agency had retreated from its previous historical

interpretation of statutory exemption).

while some of the documents from the Facility’s operating permit file relevant to

the SO

exception were included in the Record, the IEPA . . . apparently picked

and chose among a group of relevant documents when preparing the record it

submitted. Pet. Br. at 21.

Emerald argues that the “entire record” referred to in the CAAPP permit rules at 35 Ill. Adm.

Code 105.302(f) includes” everything existing in the IEPA’s files that pre-dates the final

decision on the permit.

Id.

, citing Jack Pease, d/b/a Glacier Lake Extraction v. IEPA, PCB 95-

118 (May 18, 1995).

IEPA’s Arguments

. The Agency begins its response by noting that

In light of the [IEPA’s] concession that the Agency held a contrary permitting

position for approximately twenty years concerning the applicability of 35 Ill.

Adm. Code 214.382 to this source, the inclusion of twenty years of permitting

history does not further substantiate Petitioner’s estoppel claim.

* * *

Moreover, upon receipt of an operating permit application, the [IEPA’s] review is

based upon the material contained within the application which necessarily

contains the most up-to-date information about the source. . . . so long as the

information is complete and accurate, there is no need for the Agency to review

dated operating permit records that could not only be in excess of thirty years old

but may not reflect existing source status.

* * *

The [IEPA’s] recent departure from its earlier decisions, which serves as the

pretext for Petitioner’s arguments, must stand or fall on whether it is reasoned and

supported by applicable law and regulations.

Compare,

Alton Packaging Corp. v.

PCB, 516 N. E. 2d 275, 280 (5th Dist. 1987) (review of permitting decisions held

to a consideration of material relied upon by the [IEPA]). IEPA Br. at 52-54.

IEPA observes that it did include two 1993 memoranda in the record that pre-dated

Emerald’s March 7, 1996 submission of the CAAPP permit at issue here. But, states IEPA, these

were included because they were physically attached to a 2001 memorandum concerning the

instant application. Under these circumstances, IEPA argues, they were required attachments

under the CAAPP rules at 35 Ill. Adm. Code 105.302(f). IEPA notes that Jack Pease, cited by

petitioner, also concerned a situation where the documents were physically located in the file.

IEPA Br. at 59-60.

The Agency further argues that FOIA has its own set of exceptions, and that neither the

Act nor Board rules compel release of FOIA-exempt material. IEPA Br. at 57-58.

The Board’s Ruling.

The Board finds that Emerald has produced no convincing evidence or

argument that the hearing officer’s ruling was in error. It is, of course, true that the purpose of

the CAAPP permit is to bring into one unitary document all of the operating conditions that

currently apply to a source, to avoid the need to reference a fistful of permits to determine

compliance.

See, e.g.

Mr. Evans testimony quoted

infra

at 14. But, at the same time, the Board

has no reason to disbelieve the Agency’s statement that it did not rely on the reasoning of its

earlier permit application analyses to make its 2003 CAAPP permit decision. And, as the

Agency correctly states, any permit must stand or fall on whether it is reasoned and supported by

applicable law and regulations.

HEARING TESTIMONY

As previously stated, the SO

exception of 35 Ill. Adm. Code states:

Section 214.301 shall not apply to existing processes designed to remove sulfur

compounds from the flue gases of petroleum and petrochemical processes.

Emerald, the Agency, and their witnesses agree that Emerald’s MBT-C is an existing process,

and that sulfur compounds stem from the flue gases of a petroleum and petrochemical process.

The parties also agree that the 2,000 ppm SO

limits of Section 214.301 would apply to Emerald

but for the applicability of the challenged exception.

The hearing testimony diverges concerning the issue of whether, within the meaning of

the SO

rule and its exception, the Facility is actually “designed to remove sulfur compounds”,

given the capture efficiency of Emerald’s process.

Each of Emerald’s witnesses, Messrs. Giffin, Corn, and Evans, confirmed his belief that

the SO

exception properly applied to the facility. Tr. 25-26, 70, and 86-87, respectively.

Giffin Testimony

Mr. Giffin described the MBTC-system.

See supra

, p. 4. He explained that it is a

petrochemical process, as the aniline comes from a petrochemical source. S

ee e.g.

, Tr. at 24.

The condensers condense the sulfur compound CS

during the reaction phase, returning it to the

reactor as a liquid. Some 70% of the CS

is recovered, while H

S passes through the condenser

Tr. at 26. Mr. Giffin stated that the condensers were originally designed to remove the sulfur

compound CS

from the stacked gases. Tr. at 26-27. Mr. Giffin stated that the MBT reactors

can be run without the condensers. Tr. at 27-28. This does not affect the quality of the product,

but does result in generation of more sulfur dioxide because the CS

is not being put back into

the reactor. Tr. at 54-55. More CS

is being used in the process. The purpose of the condenser

is to separate H

S from CS

so that the CS

can be recovered while the H

S can be vented to the

MBT-C blowdown tank. Mr. Giffin presumes the condenser was installed to reduce raw material

usage and to control emissions. Tr. at 56-58. Mr. Giffin agrees that the condensers qualify as

reflux condensers, since condensed material returns directly to the process from which it is

generated. Tr. at 60.

With an eye to submission of a CAAPP application, in March of 1996, Mr. Giffin began

working in 1994 with an environmental consulting firm AquAeTer, whose principal owner was

and is Michael Corn. Tr. at 28-29. As part of that process, with the advice and assistance of

legal counsel, in February 1996 Emerald submitted a FOIA application to IEPA. Emerald sought

the IEPA permitting files for the Henry plant to better understand “the posture of the IEPA

concerning our processes and to understand if we were interpreting the regulations correctly. Tr.

at 30.

In its CAAPP application, Emerald listed the SO

exception of 35 Ill. Adm. Code 214.382

as the rule applicable to its flare, consistent with its prior permits. Tr. 30-31, 34. Put another

way, Emerald did not submit a compliance plan that would allow it to otherwise achieve

compliance with the 2,000 ppm SO

limit of Section 214.301.

Id.

IEPA’s Dan Punzak began his review of the Title V application in January 2001, which

resulted in a meeting between Mr. Punzak and Mr. Giffin, along with some others on January 18,

2001. Tr. at 37. On March 21, 2001, Mr. Giffin received his first formal communication from

IEPA regarding concerns about application of the exception to the Facility’s MBT crude reactor

and condenser, to which the petitioner responded. Tr. at 38-39 and TSR. at 2120-2121; 1459-

1460. On May 16, 2003, the IEPA’s Don Sutton requested additional information, to which Mr.

Giffin responded on June 14, 2001. Tr. at 40. The exchange resulted in a meeting in July 2001

during which Mr. Punzak presented Emerald with his observations concerning other

manufacturers of the same materials in West Virginia and Louisiana, but with different control

systems. Mr. Giffin stated that the company would investigate certain add-on controls, but did

not concede that the SO

exception did not apply. Tr. at 41.

Around that time, Noveon became the company owner, and additional financial issues

presented themselves, including an ammonia problem in the Henry plant’s wastewater discharge.

Mr. Giffin stated the plant began investigating sulfur recovery using a claus unit, and that

included doing design work and cost estimates. Mr. Giffin determined that there “was no

financial return on sulfur recovery”, and found that any recovered sulfur would probably end up

in a landfill. Tr. at 42. But, prior to the issuance of the Title V permit, the company did

communicate to the IEPA a willingness to install an additional sulfur recovery system. Mr.

Giffin stated that the company wanted to work on a schedule that would allow a Board ruling on

the current control flare control device’s compliance with the federal Miscellaneous Organic

NESHAP (MON). Tr. at 43. (MON is addressed in greater detail below). Mr. Giffin expressed

appreciation for the “patience of the air people on this because it was a very, very, fragile time

for us.” Tr. at 44.

Mr. Giffin ultimately determined that use of a claus process would pose a problem for its

batch operation, given that the sulfur recovery is a continuous process. The final cost estimate

Mr. Giffin received was in excess of $5 million, up from the original estimate of $3.5 million.

Tr. at 45. The Henry plant, then purchased by Luberzol, evaluated a NaSH system. Mr. Giffin

determined that the NaSH system required an initial investment of about $10 million, but

operations would just about break even, with revenue generated by the product about equaling

material cost going in. Mr. Giffin stated that the company also considered that if it reduced the

emissions from its flare, it might qualify for emission credits that would help pay for the

initial investment. Tr. at 46. Mr. Giffin stated that the SO

credit was the primary driving force

behind this appeal. Tr. at 47.

Mr. Giffin stated that installation of the NaSH unit began in 2006. Tr. at 60. The

company is still in the “shake down” process with the system, which is not without its problems.

At the time of hearing, the system was averaging about 85% “up time” over the prior six months,

with some months better. Tr. at 62-63. The NaSH system is a unique, “one of a kind system”.

Operational issues include tar-like material that accompanies gas venting, which can cause some

lines to plug. Cold conditions also affect operations. If the NaSH plugs, the vapor stream is

diverted from the blowdown tanks to the NaSH, and diverted back to the flare. The NaSH is one

way in which Emerald can comply with the MON, but it is also evaluating use of the flare as a

back-up compliance mode. Tr. at 63-65.

Corn Testimony

As previously stated, Michael Corn is the president and primary owner of the

environmental consulting firm AquAeTer. Tr. at 65-66. As Emerald’s environmental consultant

Mr. Corn reviewed the Facility for its first CAAPP permit in the mid-1990’s. Tr. at 67, 77. Mr.

Corn testified that he believed the SO

exception of Section 214.382 rule properly applied

because the Facility “had to be a petrochemical process, and it had to remove sulfur. From our

review, both of those conditions were met”. Tr. at 72.

Mr. Corn was called back as a rebuttal witness on re-direct examination, following

testimony by IEPA’s Mr. Punzak. Mr. Corn testified concerning Emerald’s condenser and

process. Tr. at 161-165.

Evans Testimony

As previously stated, Bernard O. Evans of Environmental Resource Management, has

been an Emerald consultant since 1998, but had no hand in the 1996-2003 Title V or CAAPP

permit application process. Tr. at 81. However, he has been working with the Henry plant since

2003 in relationship to the current control flare control device’s compliance with the federal

Miscellaneous Organic NESHAP (MON); the MBT-C process is one of the miscellaneous

chemical processing units (MPCUs) affected by the MON. Tr. at 82-83. Mr. Evans believes the

current unassisted flare complies with the MON. He also believes that the NaSH system

complies with the MON. Mr. Evans stated that there are several ways to comply with the MON,

including use of a control device that reduces HAPS by 98%, or use of a recovery device that

reduces HAPS by 95 %. Mr. Evans believes that if petitioner prevails in this appeal, he can

formulate a MON compliance program based on the use of either the NaSH system when it is

operational or not plugged, or the use of the flare testified to by Mr. Giffin. If the 2,000 ppm

limits of Section 214.301 were applied to the facility, and the SO2 exception of Section

214.382 was not, the flare could not be used. Tr. at 85.

Mr. Evans reviewed the facility concerning the applicability of the exception during the

process of preparing the permit application for the NaSH system. Mr. Evans reads the Section

201.382(a) exception as requiring a petrochemical operation, and a system that designed to

reduce sulfur in relationship to the way the process operates. Mr. Evans believes that it makes

no difference if the reduction system is characterized as a reflux condenser, a control device, a

process device, or anything else, because

The rule does not describe that it requires any sort of devise other than a recovery

device. It doesn’t prescribe any level of recovery. As the rule is written, the

system would comply with that particular requirement. And I would disagree

with the interpretation it does not. Tr. at 86-87.

After Mr. Punzak’s testimony, Emerald called Mr. Evans to the witness stand again, to

testify concerning CAAPP permits. Based on his experience as a consultant and drafter of Title

V guidance documents along with USEPA, Mr. Evans stated that:

The whole purpose of the Title V CAAPP permit is to bring together all those

conditions [that exist in operating permits] into a single document that was

more easily understood by the inspector from the federal government or the state

agency in relationship to how do you review compliance of a facility. So the

whole purpose is to bring those operating conditions into a single document

[requiring review of prior operating and construction permit files]. Tr. at 168.

On re-cross, Mr. Evans agreed that Title V permits typically lists as “T1” conditions

those contained in construction permits that incorporate conditions concerning items

discussed in Title I of the CAA, including PSD and New Source Performance. Tr. at 170.

The Punzak Testimony

As previously stated, Dan Punzak, P.E. has worked for the Agency since 1978, primarily

in the air permit area, except for some 18 months during which he was employed as a field

inspector. Tr. at 92. Mr. Punzak currently works with CAAPP permits for chemical plants,

refineries, coding, printing, and similar operations. Tr. at 93.

Mr. Punzak explained that the CAAPP permit is a broad permit that encompasses an

entire site and includes all processes that occur there. There is a general section that addresses

general requirements, while there is typically another section addressing each process. The

CAAPP permit describes applicable rules and any monitoring, record keeping, reporting, and

conditions that came from construction permits. Tr. at 93-94. (Mr. Punzak does not work with

CAAPP construction permits, which are handled by another group within the Agency). Tr. at

93-94.

Mr. Punzak described the MBT crude (or MBT-C) process. Tr. 96-100. He stated that

IEPA characterized it as a batch process, and a petrochemical process. Mr. Punzak estimated

that, prior to the installation of the NaSH unit, that 70-80 % of the CS

was recycled to the

reactor by the condensers, with the balance continuing through the process as a vapor to the

blowdown tank, and ultimately to the flare. H

S travels through the process as a vapor which

passes on through to the blowdown tank and to the flare. Tr. at 101. In other words, no H

S is

removed. Tr. at 102.

Mr. Punzak classifies the two condensers as “reflux condensers”, designed to recycle

some of the raw material to the condenser. Emerald so characterized them in one portion of the

CAAPP application. Tr. at 102-103. Emerald estimated that the MBT-C condensers remove 23

% of the total sulfur compounds recovered. The condenser does not remove sulfur compounds

from the flue gases, but recycles one of the materials to the reactor. The flare converts 99% of

and H

S to SO

but is not designed to remove sulfur compounds from flue gases. Tr. at 104.

The NaSH system takes vapors in the blowdown tank and sends them to control devices

to reduce emissions. Prior to installation of the NaSH unit, actual flaring SO

emissions were in

the range of 3,000 - 4,000 tpy, with a potential to emit of 4,922 tons (rarely emitted). Tr. at 105.

Mr. Punzak testified that in a 2001 memo he questioned whether a “reflux condenser”

could properly be characterized as a control device. Based on various USEPA guidance

documents, Mr. Punzak concluded that reflux condensers are “process condensers”, and not

“control devices”. Tr. at 106, 115-117. This is because reflux condensers

are designed just to operate the process, often to save raw materials and not

for the purpose of reducing emissions. That’s just an incidental, something

that’s incidental. Tr. at 106-107.

Mr. Punzak went on to describe that petroleum refineries too have SO

emissions, mainly

resulting from the burning of fuel contaminated with H

S. Refineries seek to remove H

S from

the fuel before burning, and convert it to sulfur in a complex, multi-step process involving

combustion and use of catalysts which result in elemental sulfur. Roughly 98% of H

S is

converted to sulfur in modern systems, while 90-95% was recovered “when they adopted these

rules”. Tr. at 108. By contrast, Mr. Punzak explained that Emerald’s condensers have a “total

sulfur efficiency” of 23%, target only CS

and are designed to conserve the loss of the raw

material CS

during the reaction and “recycle” rather than “remove” it. The low 23% capture

efficiency, in combination with USEPA guidance regarding failure of “reflux condensers” to

qualify as “control devices,” lead Mr. Punzak to conclude that the Henry plant should not qualify

for the Section 214.382(a) exception. Tr. at 113-114.

Mr. Punzak discussed various USEPA guidance documents, including the one called

Control of Volatile Organic Compound [VOC] Emissions

As Mr. Punzak stated, in Illinois VOC is referred to as “volatile organic material” (VOM). Tr.

at 117.

from Batch Processes, Tr. 115-118

and R. at 2136-2510. He noted that reflux condensers are not considered to be control devices,

although some secondary condensers function primarily as control devices. Mr. Punzak stated

that Emeralds MBT-C process had no secondary condensers on its “batch organic chemical

process”, and so IEPA requested the company to provide a compliance plan. Tr. at 119. In

response, Emerald questioned use of guidance documents for pollutants other than sulfur. But,

Mr. Punzak stated that CS

is a VOC or VOM, so that use of the documents concerning VOM

control equipment was appropriate. Tr. at 120. Mr. Punzak also testified that in the MON

published by USEPA in the

Federal Register

, that process condensers include “reflux

condensers”. Tr. at 121 and R. 1841. And, because a “process condenser” is not a “control

condenser”,

if it’s a reflux or process condenser, it should, in effect, be given zero percent

efficiency in terms of control equipment that it’s designed for the purpose of

recycling material

Mr. Punzak stated that he consulted state regulators in West Virginia, Louisiana, and South

Carolina regarding similar MBT-C processes, and determined that systems in their states had

higher control efficiencies that Emerald’s MBT-C process. Tr. at 123-126. Mr. Punzak noted that

USEPA had commented on the draft CAAPP permit for Emerald, finding the “MON would be

applicable in the process.” Tr. at 127, R. at 1842-1843. But, Mr. Punzak also stated that USEPA

had not commented on the issue on appeal here: applicability of Section 214.301 vs. Section

214.382. Tr. at 127.

Mr. Punzak stated that his analysis notes in the permit also explain that reflux condensers

are process condensers which are not to be considered control equipment. Tr. 128-129, R. at

1235-1237.

On cross-examination, Mr. Punzak agreed that CS

is recycled and sent back to the

reactor was not emitted into the atmosphere. Tr. at 131-132. He acknowledged that the USEPA

guidance documents had been prepared well after Board adoption of the rules at issue, as were

many of the USEPA rules generating the guidance. Tr. at 139-140. Mr. Punzak read aloud a

portion of a 2001 memo he had prepared which was part of the permit record, remarking:

If we can show that they [Emerald] have made changes, we may be able to

use the PSD [Prevention of Significant Deterioration] rules to require control

and not have to get into the semantics of whether the condenser is a control—

recovery device. Tr. at 145, quoting R. at 1543.

Mr. Punzak agreed that PSD was not an issue.

Id.

Mr. Punzak answered questions about the

differences in the systems regulated by Louisiana. Tr. at 155. As to the MON, Mr. Punzak

agreed that the NaSH unit complies with the MON, and the CAAPP permit allowed Emerald to

use the flare when the NaSH system is unavailable due to plugging or other problems. Tr. at

156-157.

On redirect, Mr. Punzak stated that a reflux condenser could be considered a control

device if it were a secondary condenser under particular low temperature conditions involving

temperature differences. Tr. at 159. On re-cross, Mr. Punzak stated that even if the company

were to use a different cooling medium, and even if it recycled 100% of the CS

“we [at IEPA]

would probably still say that this system was not designed for that.” Tr. at 160.

THE PARTIES’ ARGUMENTS

Emerald’s 27-page opening arguments are that it complies with the terms of the SO

exception as written in Section 214.382 (Pet. Br. at 8-15) , and that the Agency should be

estopped from changing its consistent 25-year long determination that the SO

exception does in

fact apply. Pet. Br. at 15-26.

In its 66-page brief, the Agency sets forth the standard of review and burden of proof

(IEPA Br. at 8-10), states that the MBT-C condensers are reflux condensers (IEPA Br. at 8-14),

and that Section 214.382 is clear on its face and excludes the MBT-C condensers. IEPA Br. at

14-24. Additionally, IEPA argues that additional support for its contentions is given by its own

institutional knowledge (IEPA Br. 25-28), information from other states (IEPA Br. 28-31), and

USEPA guidance. IEPA Br. 31-34. IEPA also argues that Emerald has failed to prove its

estoppel claim. IEPA Br. 34-52.

In its 29-page response, Emerald argues that the Board should apply a

de novo

standard

to interpretation of the SO

exception (Pet. Rep. at 1-4), the plain language of the rule shows that

it applies to Emerald (Pet Rep. at 5-9), and IEPA reliance on extrinsic evidence is misplaced.

Pet. Rep. at 10-15. While acknowledging that the doctrine of “equitable estoppel” may not

“strictly” apply, Emerald urges that the IEPA should be held to its earlier, correct interpretation

that the SO

exception applies to the Henry plant. Pet. Rep. at 17-24.

DISCUSSION

The Board’s standard of review is clear in permit appeal cases.

See supra

at 5-6. It is

long-settled that “[t]he Board is not required to apply the manifest-weight test to its review of the

Agency’s decision denying a permit.” IEPA v. PCB, 115 Ill. 2d 65, 70, 503 N.E.2d 343, 345

(1986).

The sole issue here involves interpretation of 35 Ill. Adm. Code 214.382 as it relates to

Section 214.301. As Emerald correctly points out, when the question involved is a matter of law

involving proper interpretation of a Board rule, the Agency’s interpretation is not binding upon

the Board. See Pet. Br. at 17, Pet. Rep. at 3, citing Village of Fox River Grove v. Pollution

Control Board

299 Ill. App. 3d 869, 877-78, 702 N.E.2d 656, 662 (2d Dist. 1998) (citing

Envirite Corp. v. Illinois Environmental Protection Agency

158 Ill. 2d 210, 632 N.E.2d 1035

(1994));

see also

Peoria Disposal Co. v. Illinois Environmental Protection Agency,

PCB 08-25,

slip. op. at 31 (January 10, 2008) ("[W]hen the Agency has resolved a legal question such as

interpretation of a statutory provision, the Agency's determination is not binding upon the

Board."),

affd. sub nom

Peoria Disposal Company v. Illinois Pollution Control Board and Illinois

Environmental Protection Agency, No. 3-08-0030 (Third Dist. Jan. 20, 2009) (Rule 23 order).

Consistent with prior case law, since the Board itself has not previously interpreted

Section 214.382(a), any prior interpretations made by the Agency are not binding on the Board.

The Board approaches the issue

de novo.

The Board agrees with the parties that the language of Section 214.382(a) is clear and

unambiguous on its face.

See

IEPA Br. at 14-16 and Pet. Rep. at 4. As Emerald argues, it is a

well-accepted principle of statutory construction, and IEPA does not argue otherwise, that the

initial source for determining regulatory intent is the plain meaning of the language used. The

well-settled precedent is that where the language is unambiguous, the plain meaning of the

language controls. See Pet. Rep at 5, n. 3, citing, e.g., Board of Trustees of Southern Illinois

University Governing Southern Illinois University, Edwardsville, Illinois Environmental

Protection Agency, 2005 WL 2040591, PCB 02-105 (August 4, 2005), at * 11. Additionally, in

interpreting its rules, the Board may refer to its adopting opinion and order discussing the

hearing record developed in support of the rule and the Board’s findings. In this case, that is In

the Matter of: [Air] Emission Standards, R71-23 (April 13, 1972). Otherwise, the Board does

not examine extrinsic evidence consistent with settled case law in this area.

Emerald argues that, on its face, Section 214.382 imposes only three criteria on a permit

applicant that seeks to avail itself of this exception:

1) it must be an existing process;

2) that is designed to remove sulfur compounds from the flue gases;

3) of petroleum and petrochemical processes. Pet. Reply at 5.

The Board agrees with Emerald and its witnesses that the Henry plant’s MBT-C process

meets all of these requirements. The rule does not enquire into whether the “existing process”

uses “reflux” or “process” equipment or “control” equipment, so long as it is designed to remove

sulfur compounds from flue gases. The uncontroverted testimony here is that the Emerald

process was so designed. The rule does not address capture efficiency percentages, and the

Agency has not cited the Board to any evidence in the R71-23 regulatory record that does so.

The Board will not rewrite Section 214.382, or import into the record of R71-23, information

developed since then by other states or the federal government. The Board notes that while

USEPA submitted comments on the CAAPP permit under review here, it commented only that

the federal MON would apply to the facility. USEPA did not comment on the issue of

applicability of whether the SO

exception applies or not.

The Board finds that Emerald’s MBT-C process system qualifies for the SO

exception in

35 Ill. Adm. Code 214.382. Finding that the plain language of the rule supports the reading

sought by Emerald, the Board need not reach any equitable issues such as estoppel. The Board

accordingly finds that the Agency improperly included the condition concerning applicability of

35 Ill. Adm. Code 214.301, and remands the CAAPP permit for re-issuance consistent with the

Board’s findings in this opinion and order.

ORDER

For all of the foregoing reasons, the Board finds that the Agency improperly included in

the November 23, 2003 CAAPP permit issued to Emerald for the Henry plant various conditions

stating, or premised on, applicability of 35 Ill. Adm. Code 214.301 to Emerald’s MBT-C process

and condensers. The Board accordingly remands the CAAPP permit for expeditious re-issuance

consistent with this opinion and order.

IT IS SO ORDERED.

I, John T. Therriault, Assistant Clerk of the Illinois Pollution Control Board, certify that

the Board adopted the above order on October 15, 2009, by a vote of 5-0.

___________________________________

John T. Therriault, Assistant Clerk

Illinois Pollution Control Board