Overview

   Statement of need

Proposed Rule or Topic

Discussion

1.  Clarify and update rules

What problem is DEQ trying to solve?

DEQ proposes to clarify and update the air quality rules.

•  Some rules are missing important details, such as compliance methods, which have created problems in the air quality program.

•  There are procedures in definitions like major modification, actual emissions and netting basis that need to be written as procedural rules instead of definitions.

•  Many of the divisions regulating air quality have a rule containing definitions applicable to that division. Throughout the divisions there are multiple definitions of the same term.

•  Unfortunately many businesses have shut down in Oregon so DEQ is proposing to repeal those industry specific rules.

•  DEQ is also proposing to repeal rules for which EPA has adopted standards.

•  DEQ’s Source Sampling Manual and Continuous Monitoring Manual have not been updated since 1992.

How would the proposed rule solve the problem?

The proposal addresses missing details by:

•  including compliance methods with all standards to make sure businesses know what to do to comply with the standards

•  specifying how emissions are divided when a business splits into two or more businesses

•  adding definitions for undefined terms such as control efficiency, internal combustion source, and removal efficiency

•  normalizing the definitions throughout all the divisions of air quality rules and moving them to division 200, General Air Pollution Procedures and Definitions

•  moving the tables containing numbers into the text whenever possible to make them easier to find, such as significant emission rates, de minimis levels, generic Plant Site Emission Limits, significant impact levels and PSD increments

The following rules are no longer needed because that type of business no longer exists in Oregon. If that type of business wanted to build in Oregon, they would be permitted under more recent federal rules, which are more stringent than the state rules being repealed:

•  Neutral Sulfite Semi-Chemical Pulp Mills

•  Sulfite Pulp Mills

•  Primary Aluminum Standards

•  Laterite Ore Production of Ferronickel

•  Charcoal Producing Plants

DEQ is also proposing to repeal rules for which EPA has adopted standards making them unnecessary.

•  EPA adopted national rules that apply to manufacturers of consumer spray paint rules so DEQ is proposing to repeal the state rules. The federal rules will continue to reduce ozone from consumer products.

•  DEQ worked with the western states on a general SO₂ trading program to address regional haze. There are now specific rules such as Best Available Retrofit Technology (BART) requirements for haze causing sources like the PGE Boardman plant.

•  EPA’s rules for Commercial/Industrial Solid Waste Incineration require forced-air pit or air curtain incinerators to have Title V permits. Therefore, forced-air pit or air curtain incinerators can no longer be allowed under the open burning rules.

DEQ’s Source Sampling Manual and Continuous Monitoring Manual were last adopted in 1992. EPA methods have changed and PM_2.5 standards have since been adopted so the manuals need to be updated.

2.  Update particulate matter standards

What problem is DEQ trying to solve?

There are areas in the state where air quality is close to or over the fine particulate matter ambient air quality standard. Work on the Klamath Falls attainment plan showed that impacts from a single business along with the background concentration could be up to 70 percent of the standard. That puts similar areas with similar sources in danger of violating the ambient air quality standard. This is a big risk for public health and economic development. If the majority of the airshed is taken up already from a single business, new businesses aren’t able to come into the area. These proposed changes would allow economic expansion in the airshed. Therefore, DEQ proposes to reduce both the particulate matter standard and the visual standard to help keep areas from exceeding the PM_2.5 ambient air quality standard.

DEQ relies on several types of standards when issuing air quality permits. One standard for particulate matter – dust, dirt, chemicals, etc. – involves more quantifiable emission limits. A second standard is referred to as a visual standard, which relies on the density – or opacity – of a plume. The rules include different standards for units installed before or after 1970:

•  Pre-1970 unit: 0.2 grain/dry standard cubic foot (gr/dscf) and 40 percent opacity

•  Post 1970 unit: 0.1 gr/dscf and 20 percent opacity

The proposed rulemaking changes will affect both the statewide particulate matter and visual standards for units built before June 1970 by requiring these industries to meet the same standards as the post 1970 units.

These statewide particulate matter standards were adopted in the early 1970’s as part of the initial State Implementation Plan. At that time, there was only an ambient air quality standard for total particulate, not for PM₁₀ or PM_2.5. With the adoption of the PM_2.5 ambient air quality standard in 2011, there have been two areas designated in Oregon that exceed the standard.

These changes in the statewide particulate matter standards are proactive measures for helping to prevent violations of current PM_2.5 standards and potentially more stringent standards in the future. DEQ adopted similar, more stringent rules when areas like Medford and La Grande exceeded the PM₁₀ ambient air quality standard. By adopting more stringent rules now before areas exceed ambient air quality standards and become nonattainment areas, DEQ hopes to avoid the severe restrictions that would be required for businesses that want to build or expand in a nonattainment area.

In addition to lowering the particulate matter standard to 0.1 gr/dscf, the standard is inconsistent with current EPA policy for significant figures. EPA considers all standards to have two significant figures when conducting enforcement. Therefore, DEQ is proposing to add a zero to the standards: 0.10 gr/dscf. Businesses will have until Jan. 1, 2019 to comply with the lower particulate matter standard and until Jan. 1, 2015 to comply with the lower opacity standard.

When DEQ first adopted the opacity standard, the standard was based on an aggregate of three minutes in a 60 minute period. DEQ never developed a reference method for the 3-minute aggregate limit. In order to show compliance with this standard, people use a modified EPA Method 9 which is based on a 6-minute averaging to read opacity. DEQ is proposing to change all opacity standards (both the statewide and industry specific) to 6-minute block average, which is consistent with other states in the region and EPA opacity standards. DEQ does not believe this changes the overall stringency of the standards.

DEQ also proposes to repeal the Portland four-county 20 percent opacity standard which is an aggregate of 30 seconds in a 60-minute period for non-fuel burning equipment for the same reason. On the face of it, the visible emissions standard for the four-county area is more stringent than the current statewide standard. In the context of this rule, “non-fuel-burning-equipment” essentially means equipment that is not a boiler, such as material handling equipment. Therefore, this rule has limited applicability in the four-county area. As stated above, emissions standards are only enforceable if there is a defined method for determining compliance with the standard.

DEQ is also proposing to solve the problem of trying to read opacity from fugitive emission sources. Fugitive particulate matter emissions are emissions that are not emitted from a stack, and typically originate from storage piles, material conveying systems, unpaved roads or other dusty activities. It may be possible in many situations to take opacity readings to determine if the opacity standard is exceeded, and to then require the emitting source to take action to abate the emissions if the standard is exceeded. However, there may also be situations where opacity readings are difficult to take, or the emissions do not exceed the opacity standard but are nevertheless objectionable. The more direct approach of requiring abatement of any visible fugitive emissions that leave the source's property, regardless of the actual opacity level, is a simpler, more stringent and more effective approach to controlling such emissions. Therefore, DEQ is proposing to exempt fugitive sources from meeting the 20 percent opacity limit. EPA Method 22, Visual Determination of Fugitive Emissions from Material Sources and Smoke Emissions from Flares, is specific for fugitive sources and will be a much better method for determining compliance than what is currently used (EPA Method 9).

How would the proposed rule solve the problem?

The proposed rule changes will solve the problems by reducing the particulate matter emissions from pre-1970 units. This proposal will help to improve and maintain air quality and allow for economic development.

The proposed rule changes will also:

•  align the particulate matter standard with EPA policy on enforcement

•  will make the visual standard more practically enforceable by aligning the standard with the reference compliance method and

•  require abatement of any visible fugitive emissions that leave the business's property, regardless of the actual opacity level

3.  Change permitting for emergency generators and small boilers

What problem is DEQ trying to solve?

When the Title V permitting program was established in the mid 1990’s, DEQ developed a list of insignificant activities because all emissions had to be accounted for in the Title V permits. This list was called “categorically insignificant activities” and includes examples like:

•  Janitorial activities

•  Groundskeeping activities

•  Emergency generators

Businesses would indicate whether they had the activity onsite and these activities were exempt from permitting requirements.

EPA has since adopted new standards for emergency generators. DEQ also discovered one business that has about 8 small boilers and their potential aggregate emissions are significant, approximately 12 tons/year of nitrogen oxides. Therefore, these units should not be included in a list of “categorically insignificant activities.”

How would the proposed rule solve the problem?

DEQ is proposing changes to the rules that would remove small boilers and emergency generators from the list of insignificant sources if those units are above certain size thresholds and if their emissions in the aggregate are greater than de minimis levels.

Usually these activities will be added to an existing permit. In some cases, a business will need a permit for these activities alone. If the aggregate emissions are less than permitting thresholds, the owner/operator may only need to notify DEQ of installation of new units.

4.  Change the pre-construction permitting program (New Source Review)

What problem is DEQ trying to solve?

New Source Review is a nationwide preconstruction program that ensures new or modified facilities install the latest control technologies and do not have adverse impacts on ambient air quality standards. The New Source Review program is designed to prevent areas from becoming nonattainment areas which are areas that don’t meet ambient air quality standards and also improve the air quality in nonattainment areas to get back into attainment.

DEQ adopted new ambient air quality standards for fine particulate, PM_2.5, in 2010. These standards are much lower than the existing PM₁₀ standards. There are areas in the state close to or exceeding the fine particulate matter standard. The air quality problems in these areas are mainly due to area sources such as woodstoves, not industrial sources. The current rule structure does not adequately address these PM_2.5 ambient air quality problems. In addition, the current rules include modeling requirements that can’t be met creating an unnecessary construction ban.

DEQ wants to improve air quality in those regions by providing small businesses with incentives to reduce air emissions identified as causing problems in the community and still allow development. This flexibility cannot be granted to larger businesses because of EPA requirements so DEQ is proposing to separate the preconstruction programs for smaller and larger businesses.

Once an area that was exceeding ambient air quality standards is cleaned up, EPA must redesignate that area before less rigorous permitting requirements apply. That redesignation process can take years. The more rigorous permitting requirements, which are no longer necessary, discourage economic growth in the area.

Any business that requests a significant increase in their permitted emissions must show that the increase along with any emission reductions required will improve or “benefit” the air quality in the area. DEQ’s rules define this as a net air quality benefit. Currently this criteria is impossible to meet unless the increasing and offsetting businesses are co-located. This prevents other potentially more beneficially local air pollution reduction projects from occurring and creates an unnecessary construction ban. DEQ proposes to fix that problem.

If construction approved under the New Source Review program is delayed for good cause, the rules are not clear how an extension could be granted. DEQ is proposing to specify all the requirements for requesting an extension along with the timing.

How would the proposed rule solve the problem?

To solve these problems, DEQ will provide incentives for new or modified businesses that will help address ambient air quality problems by giving them more credit for emission reductions from priority sources – the sources that are causing the problem in the local area. If the new or modified business does not use emission reductions from priority sources, DEQ is proposing to raise the current offset ratios meaning they would need to reduce more emissions than they would generate.

DEQ is also proposing to change the definition of a major source to match EPA’s definition. With this change, there will be different requirements for small and large businesses. The program for smaller businesses will be called State New Source Review.

DEQ is establishing two new transitional areas: sustainment and reattainment areas. These areas will be designated by the Environmental Quality Commission, not EPA. Sustainment areas are designed to prevent areas from becoming nonattainment areas. Reattainment areas help transition an area back to attainment more quickly before the EPA redesignation. This change, along with the change to the definition of major source, will allow more flexibility in permitting smaller businesses while still protecting air quality.

Another aspect of the New Source Review program DEQ is proposing to change is Net Air Quality Benefit. When a business requests a significant increase in emissions over permitted levels, one thing they have to do is show the change will have a net air quality benefit in the area they are building or expanding. As mentioned previously, the current computer modeling requirements for showing that benefit are impossible to meet unless the increasing and reducing businesses are co-located. The lower PM2.5 standard has revealed this problem because we now have areas violating these standards. The proposed changes to this requirement, called Net Air Quality Benefit, will make sure air quality is protected while fixing the flaws discovered with the current modeling criteria.

All of these changes will allow construction that was previously prohibited but will still be protective of air quality.

DEQ is proposing rule changes that clarify how a business can get an extension for their New Source Review permit if construction is delayed for good cause. Current rules allow extensions provided there is a “demonstrated need” but do not specify the criteria for approving the extension and how many extensions are possible. If projects are delayed without additional review, there is the potential for proposed projects to tie up their designated portion of the airshed indefinitely, cause significant impacts on air quality, and not install the most current control technology. DEQ’s proposal adds provisions for two 18-month extensions, criteria for approving extensions, procedures for requesting extensions and procedures for approving extensions.

5.  Designate Lakeview as a sustainment area

What problem is DEQ trying to solve?

The air quality in Lakeview is currently over the PM_2.5 ambient air quality standard even though the area is not designated as nonattainment (an area that exceeds an ambient air quality standard). Without this designation, there is a construction ban for new and modified businesses, even though uncertified residential wood fuel-fired devices are the cause of the air quality problem.

How would the proposed rule solve the problem?

DEQ is proposing changes to the rules that would improve air quality in Lakeview and also provide incentives for businesses to address emissions from uncertified residential wood fuel-fired devices. DEQ is working with the Lakeview community to avoid nonattainment area designation. Designating Lakeview as a sustainment area is one part of the overall plan.

6.   Provide DEQ more flexibility for public hearings and meetings

What problem is DEQ trying to solve?

The rules are very prescriptive regarding how public hearings and meetings must be held. The rules were first adopted in 1974, long before the technological advances that are currently available. Traveling to hearings and meetings around the state can be resource intensive and wasteful if no one shows up for the hearing or meeting.

How would the proposed rule solve the problem?

This proposal will make it easier and cheaper for people to participate in public hearings and meetings by removing the prescriptive language from the rules. DEQ is committed to public engagement and is looking at new and innovative ways to reach people and hold hearings.

7.   Update HeatSmart

What problem is DEQ trying to solve?

Due to recent EPA rule changes, small biomass boilers with heat output less than 1 million Btu/hr are no longer subject to federal requirements. Being subject to federal requirements allowed the small scale commercial, industrial and institutional biomass boilers to be exempted from DEQ’s Heat Smart rules, which had prevented the boilers from being sold in Oregon. With EPA’s rule changes, these devices are subject to the Heat Smart rules, and can no longer be sold in Oregon.

How would the proposed rule solve the problem?

The proposed rule changes would provide a pathway for small scale commercial, industrial and institutional biomass boilers to be sold in Oregon again, while ensuring they are still subject to existing state limits on particulate and opacity. This change would eliminate the reference to the federal regulations, and allow these boilers (those with a heat output less than 1 million Btu per hour) to be sold in Oregon.

8.   Implement SB 249A - Clean diesel grant and loan rules

What problem is DEQ trying to solve?

In 2007 the Oregon Legislature outlined the elements of a grant, loan and tax credit supported program to reduce environmental and public health risks from diesel engine pollution. There are a wide variety of strategies to reduce the pollution impact from diesel engines, including installing advanced exhaust controls, repowering engines to more stringent emission standards, increasing efficiency in operations involving diesel engines, reducing unnecessary idling, switching to lower emitting alternative fuels, among other actions. Some of these actions have an inherent economic advantage and represents an ineffective use of public financial resources to subsidize. Other actions, e.g., alternative fuels, have levels of public financial support from other programs. The original limited authorization for clean diesel grants, loans and tax credits managed by DEQ reflected a strategic decision to support a limited number of cost effective strategies not otherwise financed through private returns on investment or other public assistance.

State funds for clean diesel work have not been appropriated since the 2007-09 biennium and the tax credit program was shut down in 2012. This has led to a constrained grant program that is not in alignment with the range of allowable activities under available funding. The primary remaining funding stream is managed by EPA through the federal Diesel Emission Reduction Act. The Act includes a more expansive list of allowable project activities than were authorized under Oregon statutory authority. However, DEQ is still constrained in applying for and managing federal grants by the statutory authority. As an example, there was no interest in pursuing projects within the original statutory scope for the FY 2012 cycle despite broad outreach and project recruitment efforts. Consequently no federal funds were awarded for Oregon projects in that year. Aligning DEQ’s clean diesel project authority with federal grant guidelines allows for ongoing and developing interest in clean diesel activities to be supported, e.g., vehicle and equipment replacement as compared to exhaust retrofitting.

How would the proposed rule solve the problem?

DEQ determined that failure to amend the proposed rule would delay implementation of projects to reduce the harmful emission from diesel engines through vehicle and equipment replacement projects both proposed and in hand. Timely movement on grant administration reinforces DEQ’s reputation as effective in taking meaningful action towards protection of public health and the environment. Failure to adopt the rule:

•  dissipates momentum generated by the unilateral support by the Oregon Legislature as well as a diverse group of industry, public health, public interest and environmental advocacy groups that worked for the passage of SB 249.

•  delays timely implementation of a project intended to showcase climate change and public health benefits that can arise from vehicle replacement and exhaust retrofitting in highway maintenance vehicles that in turn, will be used to recruit other interested parties to take comparable actions. Delays in project implementation contribute to issues in completing projects in a timely manner, which reflects unfavorably upon the DEQ’s ability to secure future grant awards from EPA.

•  undermines the Oregon Clean Diesel Initiative’s effort to support program goals to reduce the adverse impacts from toxic air pollutants and mitigate climate change

9.  Annual reporting requirement for small gasoline dispensing facilities

What problem is DEQ trying to solve?

A gasoline dispensing facility with a monthly throughput of less than 10,000 gallons of gasoline is currently required to:

•  meet work practice standards

•  have a submerged fill tube installed on their tank(s)

•  submit a one-time initial notification and notification of compliance status and

•  submit annual reports of throughput

They are not required to have an air quality permit. DEQ has determined that the annual reporting requirement for these small gasoline dispensing facilities is unnecessary because DEQ has collected one time data on these facilities throughput and has the ability to request additional information if needed.

How would the proposed rule solve the problem?

The proposal addresses this by removing the annual reporting requirement for facilities with monthly throughput less than 10,000 gallons. As mentioned above, DEQ would still have the authority to request throughput information from these facilities, and may do so, for businesses close to the 10,000 gallon permitting threshold.

How will DEQ know the problem has been solved?

For all of the sections 1 through 8 above, upon adoption by the EQC, DEQ would submit the rules to EPA to update Oregon’s State Implementation Plan. DEQ will know the goals of this rulemaking have been addressed when EPA reviews and approves the State Implementation Plan revision.

   Rules affected, authorities, supporting documents

1.  Clarify and update rules

2.  Update particulate matter standards

3.  Change permitting requirements for emergency generators and small boilers

4.  Change the pre-construction permitting program (New Source Review)

5.  Designate Lakeview as sustainment area

Program or activity – New Source Review

6.  Provide DEQ more flexibility for public hearings and meetings

Program or activity – Public Notice

7.  Update HeatSmart

8.  Implement SB 249A - Clean diesel grant and loan rules

Program or activity - Clean Diesel Initiative

9.  Remove annual reporting requirement for small gasoline dispensing facilities

Program or activity – Program Operations

   Fee Analysis  

   Statement of fiscal and economic impact      ORS 183.335 (2)(b)(E)

1.   Clarify and update rules

There are no fiscal or economic impacts as a result of the proposed rule changes to clarify and reorganize the existing rules.

2.  Update particulate matter standards

DEQ has identified 6 businesses (1 small business) that may not be able to comply with the lower particulate standard without process changes, installation of control equipment or replacement of process equipment. These businesses are wood products facilities with wood-fired boilers. There are also two small asphalt plants that may not be able to comply with the lower visual and particulate matter standards.

Wood-fired Boilers: Some businesses may need to optimize their boiler operations in order to comply with the particulate matter standards. Close monitoring of fuel quality may help some boilers comply while others may need tune-ups. According to one vendor contacted by DEQ, a typical boiler tune-up, if no parts need to be replaced, is estimated to cost in the range of $5,000-$10,000. A tune-up may include:

•  A visual inspection of the system while operating, looking for obvious things that need repair

•  Review of past performance checks & expected performance data

•  Gathering performance data (O₂ & CO₂ readings, stack temperature, feed water temperature, fuel moisture, steam flow)

•  Making adjustments to furnace air delivery settings

A more comprehensive boiler tune-up ranges in cost from $30,000 to $60,000. A boiler tune-up may or may not allow sources to comply with the new standards over the long run but could provide other benefits such as reduced fuel costs.

However, if optimizing operations does not achieve compliance with the lower grain loading and opacity standards, businesses may need to install pollution control equipment such as multiclones or electrostatic precipitators. Based on vendor information, multiclones range in cost from $60,000 to $80,000 and will remove some particulate matter but may not be successful in removing enough to comply with the new standard. Information from vendors and a business that recently installed an electrostatic precipitator indicates the cost of a new ESP ranges from $450,000 to $1,500,000. Although not anticipated, boiler replacement to achieve compliance would have the greatest fiscal impact on a business. A business that recently installed a new wood-fired boiler capable of 100,000 pounds of steam/hour paid approximately $8 million.

Asphalt Plants: One asphalt plant that did not meet the existing 0.1 grain/dscf limit and has been referred to DEQ’s enforcement division for enforcement action and civil penalties. It is anticipated that improvements to the existing baghouse to meet the current grain loading limit will also ensure that the business will be able to meet the proposed lower standard.

The two small asphalt plants that may not be able to meet the lower standards are older plants that utilize wet scrubber controls. In general, for asphalt plants that cannot meet particulate matter standards, the equipment is simply worn out, and often too expensive to repair. In other instances the control equipment (usually the water scrubber) is rusted and leaking air, compromising the pressure drop across the nozzles, thus reducing efficiency. Most of the time, companies with stationary asphalt plants will repair/patch together equipment. Making these repairs is usually done in-house. Portable plants have to be more durable due to set-up and break-down cycles. As a result, they are generally replaced with new or better used equipment.

An asphalt plant that may not be able to meet the lower standards may elect to retire the plant if it is deemed too expensive to meet the new particulate matter standards. The total cost of installing a used baghouse is approximately $150,000 to $250,000 and the cost of a new asphalt plant is approximately $1.5 to $2 million.

3.  Change permitting requirements for emergency generators and small boilers

The proposed rules may have a negative fiscal and economic impact on businesses that own emergency generators or multiple small boilers if these units are required to get permits. The cost of that permit is approximately $1,300. DEQ has not identified any business that will be required to get a permit as a result of the proposed rule changes. Most of the units that fall into these categories will be added to existing permits at the time of renewal. There may be costs associated with additional recordkeeping but will be dependent on current environmental managements systems in place. DEQ lacks available information to accurately estimate those costs.

4.  Change the pre-construction permitting program (New Source Review)

The proposed rules may have a negative or positive fiscal and economic impact on businesses that trigger the New Source Review program, depending on the situation. DEQ is raising the amount of offsets a business may be required to get but allowing for reduced offsets if the business chooses to get the offsets from the sources causing the problem in areas where air quality is close to the PM_2.5 ambient air quality standard. The cost of industrial offsets varies from $2,500/ton to $100,000/ton, depending on the pollutant and how badly the offset is needed.

If the business chooses to obtain offsets from the sources that are causing the problem, based on current information, the offsets would be required from woodstoves. The cost to replace an uncertified woodstove is $3,000, which would reduce emissions by 0.03 tons/woodstove. The cost of a ton of offsets from woodstoves is approximately $100,000/ton.

In areas DEQ wants to transition back to attainment more quickly than EPA could redesignate the area, the proposed rules will have a positive fiscal and economic impact on businesses because they will be allowed to meet the attainment area requirements rather than the more stringent nonattainment area requirements. The control technology may be less expensive but if it results in lower emission reductions than could be achieve with other more expensive technology, more offsets will be required. As a result, there may be higher emission offset costs if the less expensive control technology allows higher emissions.

For businesses that were not allowed to build or modify under the existing rules, there will be a positive fiscal and economic impact since that construction would probably be allowed as long as air quality is protected.

For these situations, since New Source Review permitting is a case-by-case analysis, and because the type of pollution controls and computer modeling varies for each case, DEQ lacks available information to accurately estimate those costs.

5.  Designate Lakeview as sustainment area

The proposed rules will have a positive fiscal and economic impact in Lakeview by allowing businesses to build or expand in the area as long as air quality is protected. Since New Source Review permitting is a case-by-case analysis, and because the type of pollution controls and computer modeling varies for each case, DEQ lacks available information to accurately estimate those costs.

6.  Provide DEQ more flexibility for public hearings and meetings

The proposed rules will have a positive fiscal and economic impact on DEQ because they will give DEQ the flexibility to hold virtual hearings with people calling in from around the state. This will reduce the amount of travel resources spent. Currently DEQ staff travel to hearings/meetings, not knowing whether there will be any attendees. The cost of using a state car is $0.565/mile. DEQ tries to hold hearings/meetings in offices that are free of charge. The average hourly rate of a permit writer, including benefits, is $70 to $85/hour. The cost of the hearing/meeting depends on the location and how far staff have to travel. If the physical location of the hearing/meeting is 2 hours away, the cost of the hearing/meeting could be approximately $2000. At least $800 of that cost is due to transportation.

The proposed rules will also have a positive fiscal and economic impact on hearing/meeting attendees because they will be able to call in from around the state, rather than travel. Once again, these cost savings depend on the physical location of the hearing/meeting. DEQ lacks available information to accurately estimate those costs since the travel distance for hearing/meeting attendees is unknown.

7.  Update HeatSmart

DEQ anticipates that there would be a positive economic benefit for businesses who wish to manufacture or use small biomass heating systems in commercial, industrial and institutional applications. These proposed rules are to re-establish a pathway for small biomass boilers to be sold for commercial, industrial, and institutional uses in Oregon.

8.  Implement SB 249A - Clean diesel grant and loan rules

There is no fiscal or economic impact from this proposed rule change because it is a voluntary program.

9.  Remove annual reporting requirement for small gasoline dispensing facilities

DEQ anticipates that there would be a positive fiscal and economic impact as a result of EQC removing the annual reporting requirement for gasoline dispensing facilities with monthly throughput of less than 10,000 gallons of gasoline. The estimated number of gasoline dispensing facilities with monthly throughput of less than 10,000 gallons of gasoline is 540. Removing the annual reporting requirement for small gasoline dispensing facilities would reduce the impact of reporting, recordkeeping and other administrative activities, on small businesses.

1.  Clarify and update rules

DEQ does not anticipate any direct fiscal or economic impacts from these changes on the general public because these changes will not affect the stringency of DEQ’s rules.

2.  Update particulate matter standards

DEQ does not anticipate any direct fiscal or economic impacts from the proposed rules on the general public because of potential changes due to the lower particulate matter standards. However, indirect fiscal or economic impacts to the public may occur through increased prices for services or products as a result of costs associated with additional control or process equipment that may be required to meet lower particulate matter standards. DEQ expects any such price increases to be small and lacks available information upon which it could accurately estimate potential increases.

Particulate matter causes serious health problems ranging from increased respiratory and pulmonary symptoms, hospital admissions and emergency room visits to premature death for people with heart and lung disease. These health problems have negative economic impacts. The proposed rules could create positive economic benefits and improvements in public health and welfare by reducing particulate matter emissions statewide.

3.  Change permitting requirements for emergency generators and small boilers

DEQ does not anticipate any direct fiscal or economic impacts from the proposed rules on the general public because of the requirement to get a new permit or modify an existing permit to add emergency generators or small boilers. However, indirect fiscal or economic impacts to the public may occur through increased prices for services or products as a result of costs associated with a new permit. DEQ expects any such price increases to be small and lacks available information upon which it could accurately estimate potential increases.

4.  Change the pre-construction permitting program (New Source Review)

DEQ does not anticipate any direct fiscal or economic impacts from the proposed rules on the general public because of the requirement to get a New Source Review permit based on the amount of emissions or the location of the new or modified business. However, indirect fiscal or economic impacts to the public may occur through increased prices for services or products as a result of costs associated with a new permit. There may also be positive indirect fiscal or economic impacts by designating areas as sustainment or reattainment since these designations are designed to help prevent an area from becoming a nonattainment area (a major negative fiscal or economic impact) and to transition an area back into attainment more quickly. DEQ expects any such price increases to be small and lacks available information upon which it could accurately estimate potential increases.

5.  Designate Lakeview as sustainment area

DEQ does not anticipate any direct fiscal or economic impacts from the proposed rules on the general public because of the Lakeview sustainment area designation. However, positive indirect fiscal or economic impacts to the public may occur through more businesses being able to locate in Lakeview. In addition, if new businesses locate in Lakeview, some members of the public may benefit from woodstove replacements. DEQ expects any such price decreases to be small and lacks available information upon which it could accurately estimate potential decreases.

6.  Provide DEQ more flexibility for public hearings and meetings

DEQ does not anticipate any direct fiscal or economic impacts from the proposed rules on the general public because of more flexibility in holding public hearings and meetings. However, positive indirect fiscal or economic impacts to the public may occur through more efficient use of DEQ resources and ease of attending the meetings by communities around the state. DEQ expects any such price decreases to be small and lacks available information upon which it could accurately estimate potential decreases.

7.  Update HeatSmart

DEQ does not anticipate any direct, negative fiscal or economic impacts from the proposed rules on the general public.

8.  Implement SB 249A - Clean diesel grant and loan rules

DEQ anticipates that there would be a positive fiscal and economic impact on the general public with this change if more equipment upgrades occur in Oregon. DEQ estimates that this impact would be very small and would probably not be passed on to the general public or customers.

9.  Remove annual reporting requirement for small gasoline dispensing facilities

DEQ anticipates that there would be a positive fiscal and economic impact on the general public as a result of EQC removing the annual reporting requirement for gasoline dispensing facilities with monthly throughput of less than 10,000 gallons of gasoline. DEQ estimates that this impact would be very small and would probably not be passed on to the general public or customers.

1.  Clarify and update rules

Initial workload for DEQ will increase as a result of the proposed rule changes but will eventually decrease as staff becomes familiar with the proposed rules.

2.  Update particulate matter standards

Initial workload for DEQ will increase as a result of the proposed rule changes but will eventually decrease as staff becomes familiar with the proposed rules. Preventing areas from becoming nonattainment will avoid future increases in DEQ workload.

3.  Change permitting requirements for emergency generators and small boilers

Initial workload for DEQ will increase as a result of the proposed rule changes but may later level off or decrease depending on the number of new sources that require permits.

4.  Change the pre-construction permitting program (New Source Review)

Initial workload for DEQ will increase as a result of the proposed rule changes but will eventually decrease as staff becomes familiar with the proposed rules. Preventing areas from becoming nonattainment will avoid future increases in DEQ workload.

5.  Designate Lakeview as sustainment area

Initial workload for DEQ will increase as a result of the proposed rule changes but will eventually decrease as staff becomes familiar with the proposed rules. Preventing areas from becoming nonattainment will avoid future increases in DEQ workload.

6.  Provide DEQ more flexibility for public hearings and meetings

Workload for DEQ may increase or decrease depending on how this rule is implemented.

7.  Update HeatSmart

The workload for DEQ will not change because these rules reestablish a pathway for small scale industrial, commercial, and institutional boilers to be sold in Oregon again.

8.  Implement SB 249A - Clean diesel grant and loan rules

There is no fiscal or economic impact on the general public from this proposed rule change because the cost of administering the grant are recovered from the grant itself, including indirect costs.

9.  Remove annual reporting requirement for small gasoline dispensing facilities

The workload for DEQ will decrease as a result of the proposed rule changes because there will be fewer reports to process and review.

a) Estimated number of small businesses and types of businesses and industries with small businesses subject to proposed rule.

The proposed rules would require all small businesses (approximately 1550) to comply with lower grain loading and opacity standards. Current compliance information indicates that most small businesses already comply with the proposed standards. Approximately 4 or 5 sources may have to add controls.

b) Projected reporting, recordkeeping and other administrative activities, including costs of professional services, required for small businesses to comply with the proposed rule.

Fewer costs for reporting, recordkeeping or other administrative activities are expected if the amendments are adopted because approximately 540 gasoline dispensing facilities with monthly throughput of less than 10,000 gallons of gasoline will not be required to report. There will be more recordkeeping and reporting for emergency generators and small boilers.

c) Projected equipment, supplies, labor and increased administration required for small businesses to comply with the proposed rule.

No additional costs for equipment, supplies, labor or administration are expected if the amendments are adopted.

d) Describe how DEQ involved small businesses in developing this proposed rule.

Small businesses are being informed by announcements on the DEQ website, through direct mailings and email lists, stakeholder meetings, notices in the Secretary of State Bulletin, and ads in local papers. Comments are being requested during the Public Comment period and at Public Hearings held in November. DEQ staff will participate in the December Northwest Environmental Conference in Portland informing people about the rulemaking. Attendees at this conference include representatives from large and small businesses.

1.  Clarify and update rules

NA

2.  Update particulate matter standards

NA

3.  Change permitting requirements for emergency generators and small boilers

4.  Change the pre-construction permitting program (New Source Review)

NA

5.  Designate Lakeview as sustainment area

NA

6.  Provide DEQ more flexibility for public hearings and meetings

7.  Update HeatSmart

8.  Implement SB 249A - Clean diesel grant and loan rules

NA

9.  Remove annual reporting requirement for small gasoline dispensing facilities

NA

1.  Clarify and update rules

DEQ determined the proposed rules would have no effect on the development cost of a 6,000-square-foot parcel and construction of a 1,200-square-foot detached, single-family dwelling on that parcel. The proposed rule only affects the ease of use of DEQ’s rules.

2.  Update particulate matter standards

DEQ determined the proposed rules may have an effect on the development cost of a 6,000-square-foot parcel and construction of a 1,200-square-foot detached, single-family dwelling on that parcel if the costs for additional control or process equipment are passed through by businesses providing products and services for such development and construction. The possible impact appears to be minimal. DEQ cannot quantify the impact at this time because the information available to it does not indicate whether the costs would be passed on to consumers and any such estimate would be speculative.

3.  Change permitting requirements for emergency generators and small boilers

DEQ determined the proposed rules may have an effect on the development cost of a 6,000-square-foot parcel and construction of a 1,200-square-foot detached, single-family dwelling on that parcel if the costs for additional permits are passed through by businesses providing products and services for such development and construction. The possible impact appears to be minimal. DEQ cannot quantify the impact at this time because the information available to it does not indicate whether the costs would be passed on to consumers and any such estimate would be speculative.

4.  Change the pre-construction permitting program (New Source Review)

DEQ determined the proposed rules may have an effect on the development cost of a 6,000-square-foot parcel and construction of a 1,200-square-foot detached, single-family dwelling on that parcel if the costs for additional permits, control or process equipment are passed through by businesses providing products and services for such development and construction. The possible impact appears to be minimal. DEQ cannot quantify the impact at this time because the information available to it does not indicate whether the costs would be passed on to consumers and any such estimate would be speculative.

5.  Designate Lakeview as sustainment area

DEQ determined the proposed rules would have no effect on the development cost of a 6,000-square-foot parcel and construction of a 1,200-square-foot detached, single-family dwelling on that parcel. The proposed rule only affects whether businesses can construct or modify in the Lakeview area.

6.  Provide DEQ more flexibility for public hearings and meetings

DEQ determined the proposed rules would have no effect on the development cost of a 6,000-square-foot parcel and construction of a 1,200-square-foot detached, single-family dwelling on that parcel. The proposed rule only affects how DEQ can hold public hearings and informational meetings.

7.  Update HeatSmart

DEQ determined the proposed rules would have no effect on the development cost of a 6,000-square-foot parcel and construction of a 1,200-square-foot detached, single-family dwelling on that parcel. These proposed rules re-establish a pathway for small biomass boilers to be sold for commercial, industrial, and institutional uses in Oregon.

8.  Implement SB 249A - Clean diesel grant and loan rules

DEQ determined the proposed rules would have no effect on the development cost of a 6,000-square-foot parcel and construction of a 1,200-square-foot detached, single-family dwelling on that parcel. The proposed rule only affects administration of grants to reduce emissions from diesel engines.

9.  Remove annual reporting requirement for small gasoline dispensing facilities

DEQ determined the proposed rules would have no effect on the development cost of a 6,000-square-foot parcel and construction of a 1,200-square-foot detached, single-family dwelling on that parcel. The proposed rule only affects gasoline dispensing facilities with a monthly throughput of less than 10,000 gallons of gasoline.

   Federal relationship                      

1.  Clarify and update rules

DEQ determined this rule proposal is “in addition to federal requirements” to address administrative issues. DEQ’s rules are different from EPA rules so clarifying and updating these rules may be considered to be “in addition to federal requirements” because EPA does not have identical rules.

2.  Update particulate matter standards

The proposed rules are “in addition to federal requirements” to protect public health and the environment. DEQ has statewide opacity limits for new and existing sources, including fugitive emission sources. There is no equivalent opacity standard for all businesses in EPA regulations. Some New Source Performance Standard (NSPS) have opacity and particulate matter limits for the specific industry being regulated but nothing that applies across the board.

DEQ identified two NSPS that have opacity limits for fugitive emissions. The New Source Performance Standard (NSPS) for Metallic Mineral Processing Plants (Subpart LL) requires fugitive emissions to meet 10 percent opacity using Method 9 for compliance. Subpart OOO, Standards of Performance for Nonmetallic Mineral Processing Plants, contains a limit of 7 percent opacity and allows an affected facility to rely on water carryover from upstream water sprays to control fugitive emissions. EPA Method 9 is used when determining compliance with the fugitive emissions standard. Even though the proposed rule changes for fugitive emission sources are different than the two applicable federal requirements, they are just as, if not more stringent than the two NSPS standards because DEQ is requiring any fugitive emissions that leave the property to be abated.

The proposed changes to the current statewide visible emission standards that apply to non-fugitive sources will put DEQ’s standards on the same basis as EPA’s visible emissions standards. DEQ proposes changing the standards from an aggregate period to a six-minute average in order to use EPA Method 9 for determining compliance. The proposed change to add a significant figure to the particulate matter standard (0.1 gr/dscf to 0.10 gr/dscf) will also align DEQ rules with applicable federal requirements and policies.

3.  Change permitting requirements for emergency generators and small boilers

The proposed rules are “in addition to federal requirements” and protect public health and the environment. The proposed rules will require construction approvals or permits for units whose emissions are significant but were previously treated as insignificant activities. EPA requires states to have permitting programs for smaller units but does not specify the details of a minor New Source Review program. Because of the Plant Site Emission Limit rules, DEQ permits regulate smaller units than EPA requires.

4.  Change the pre-construction permitting program (New Source Review)

The proposed rules are “in addition to federal requirements” and protect public health and the environment while addressing economic concerns. The proposed rules modify Oregon’s existing permitting rules which are different than federal rules. Oregon’s permitting program has been structured in a different way than the federal program since it originated in 1982, but is considered equivalent by EPA. The proposed rulemaking also aligns some aspects of Oregon’s program with EPA’s federal program.

DEQ is proposing to change the definition of a major source to match EPA’s definition. There will be different requirements for small and large businesses. The program for smaller businesses will be called State New Source Review. This change, along with the designation of sustainment and reattainment areas will allow more flexibility in permitting smaller sources but still protect the ambient air quality.

The proposed rules create new differences between the Oregon and EPA New Source Review preconstruction programs by defining two new area designations, sustainment and reattainment. DEQ feels that these two new areas will have an important role in avoiding exceedances of the ambient air quality standard and also encouraging economic development when air quality has been improved in a nonattainment area.

DEQ’s program, although substantially different from EPA’s regulations, provides a workable program which is equivalent to EPA’s and will accomplish the Clean Air Act goal of preventing significant deterioration of air quality.

5.  Designate Lakeview as sustainment area

The proposed rules are “in addition to federal requirements” and protect public health and the environment while addressing economic concerns. EPA only designates nonattainment areas. DEQ’s proposal to designate other areas will improve Oregon’s New Source Review program by improving air quality in areas where it is needed and providing permitting flexibility for smaller businesses.

6.  Provide DEQ more flexibility for public hearings and meetings

The proposed rules are not “different from or in addition to federal requirements” and impose stringency equivalent to federal requirements.

7.  Update HeatSmart

DEQ’s rules are different from EPA rules so clarifying and updating these rules may be considered to be “in addition to federal requirements” because EPA does not have identical rules.

8.  Implement SB 249A - Clean diesel grant and loan rules

The proposed rules are “in addition to federal requirements” and not required by federal requirements.

9.  Remove annual reporting requirement for small gasoline dispensing facilities

The proposed rules remove the annual reporting requirement for gasoline dispensing facilities with monthly throughput of less than 10,000 gallons of gasoline. This change would be consistent with the federal requirements because the federal gasoline dispensing facility NESHAP does not require gasoline dispensing facilities with monthly throughput of less than 10,000 gallons of gasoline to submit annual reports.

1.  Clarify and update rules

DEQ considered leaving the rules as they are but wanted to clarify as much as possible and update all rules. DEQ did not pursue this alternative because there would still be confusion, possible misinterpretations and errors in the rules.

2.  Update particulate matter standards

DEQ considered leaving the particulate matter standards the same but felt that protecting air quality and the potential for economic development is more important. Most businesses that were constructed before 1970 have already updated their facilities and now meet the lower particulate matter standards. This proposed rule change levels the playing field for pre-1970 and post-1970 businesses.

DEQ considered leaving the averaging time for opacity standards at the aggregate 3 minutes in 60 minutes and the 30 seconds in 60 minutes but without a reference test method for compliance, enforceability of the standards is questionable.

DEQ considered leaving the opacity limits for fugitive emission sources as is but determined that this approach would perpetuate difficulty in implementation of the standard. DEQ did not pursue this alternative because abating fugitive emissions leaving the property boundary reduces emissions more than trying to determine compliance with 20 percent opacity.

3.  Change permitting requirements for emergency generators and small boilers

DEQ did not consider any alternatives because leaving the permitting requirements for small sources as is would cause potential violations of the internal combustion engine standards and DEQ rules for operating without a permit.

4.  Change the pre-construction permitting program (New Source Review)

DEQ considered not changing the New Source Review rules but believes the proposed changes will improve air quality and provide flexibility for smaller businesses. DEQ did not pursue this alternative because in areas that are over the standard but still designated as attainment, there is essentially a construction ban. DEQ has also found that current rules for demonstrating net air quality benefit in nonattainment areas are overly prescriptive and do not meet the goals of the program.

5.  Designate Lakeview as sustainment area

DEQ considered not designating Lakeview as a sustainment area because we were not sure if the local community supported the designation. DEQ did not pursue this alternative because construction should be allowed as long as air quality is protected.

6.  Provide DEQ more flexibility for public hearings and meetings

DEQ considered leaving the requirements for public hearings and meetings as is but the economic benefits and improved effectiveness of outreach using recent technology supported the proposed change. DEQ did not pursue this alternative because technology will only improve, making access to public hearings and meetings easier for the general public.

7.  Update HeatSmart

DEQ did not consider any other alternatives because this rulemaking is to fix the rules to return it to its previous state, before EPA amended the NESHAP rules.

8.  Implement SB 249A - Clean diesel grant and loan rules

DEQ did not consider any alternatives because failure to adopt the proposed amendment will undermine the Oregon Clean Diesel Initiative’s effort to support program goals to reduce the adverse impacts from toxic air pollutants and mitigate climate change.

9.  Remove annual reporting requirement for small gasoline dispensing facilities

DEQ considered keeping the annual reporting requirement for gasoline dispensing facilities with monthly throughput of less than 10,000 gallons of gasoline. DEQ rejected this alternative because it determined that the annual reporting requirement for these small gasoline dispensing facilities is unnecessary. DEQ would still have the authority to request throughput information from these facilities, and may do so, for businesses close to the 10,000 gallon permitting threshold.

   Land use

 Stakeholder and public involvement