AQMD ANNUAL EMISSIONS REPORTS

Who is required to file?

• Facilities in the Annual Operating Permit Emission Fee Program; those are companies who pay annual emissions for permitted equipment. Such facilities are subject to AQMD Rule 301(e) and are required to file when exceeding the corresponding reporting thresholds;
• Facilities whose permitted plus all un-permitted emissions equal 4 tons or more per year of criteria pollutants (VOCs, NOx, SOx, PM, Specific Organics); or 100 tons or more per year of CO.
• Facilities, which had emissions [thresholds specified in Rule 301(e)] of specific Toxic Air Contaminants or ozone depleting compounds, listed in form TAC;
• Facilities that receive a 2009 Annual Emissions Report Package.

What if I miss the deadline?

The SCAQMD 2009 Annual Emissions Report is due March 2, 2010. If a facility misses the deadline and owes an emission fee, late payment penalties in the form of a percentage of the emission fees will apply. The penalties are set forth in AQMD Rule 301(e)(10)(B) and are as :

After submitting my report I found out I estimated emissions incorrectly

Companies who pay their emissions fees on time but underestimated their emissions, which resulted in underpayment to SCAQMD, can re-submit the report subject to underpayment penalties. If the underpayment is corrected within one year from the filing deadline and more than 90% of the amount due was paid, there are no penalties. However, if payment was less than 90% of the amount due, the penalty is 15% of the underpayment amount. When the underpayment is determined more than one year and sixty days from the official due date, fee rates and penalties will be assessed based on 301(e)(10)(D). Fees are determined based on rates in effect for the year when the emissions are actually reported, and not the year wherein the emissions occurred.

A facility can file a refund request when overestimating of the emissions resulted in overpayment to AQMD. The refund request must be submitted in writing as set forth in Rule 301. Form A can also be used to request refunds associated with the current reporting period.

Recent changes

Effective January 1, 2008, facilities are required to report emissions on a calendar year basis (from January 1 to December 31 of the reporting year).

Special circumstances

The AQMD has a Fee Review Committee to handle issues regarding fees and penalties.

PERMIT MORATORIUM AT SCAQMD ENDS

The South Coast Air Quality Management District announced that it will begin issuing permits held up due to the permit moratorium, effective January 2, 2010. The moratorium was the result of a lawsuit filed by environmental groups. In November 2008, a state judge issued a ruling concluding that the SCAQMD had violated the California Environmental Quality Act (CEQA) in the process of adopting two rules. The judge’s final order in this case required AQMD to set aside two of the agency’s regulations governing its emissions offset program on California Environmental Quality Act (CEQA) grounds. Thus, the agency could not issue 1,200 air pollution permits.
The SCAQMD sought legislation to reverse the court’s ruling, which was recently signed into law by the governor. The new law allows AQMD to resume issuing emission “offsets” at no charge, to small to medium-sized businesses and public service facilities. AQMD can resume issuing offsets to businesses that emit less than four tons per year of smog-forming emissions, as well as public service facilities such as police and fire stations, schools, hospitals, landfills and sewage treatment plants. The law serves as a stopgap measure, temporarily lifting the permit moratorium while allowing AQMD time to complete rulemaking on its emission offset program pursuant to the state court decision. The legislation will expire on May 1, 2012.
Some environmental groups are already challenging the latest legislation & AQMD intentions by petitioning the Federal EPA.

ENVIRONMENTAL PROTECTION AGENCY ISSUES “ENDANGERMENT FINDING” FOR GREENHOUSE GASES

A 2007 U.S. Supreme Court ruling determined that greenhouse gases fit within the Clean Air Act definition of air pollutants. The ruling held that the EPA must issue an “endangerment finding” before it can regulate carbon dioxide and five other greenhouse gases released from automobiles, power plants, and factories under the federal Clean Air Act.

EPA recently announced that greenhouse gases (GHGs) threaten the public health and welfare of the American people and should be regulated under the Clean Air Act. EPA also concluded that GHG emissions from on-road vehicles contribute to that threat.

EPA’s endangerment finding covers emissions of six greenhouse gases:

• carbon dioxide
• methane
• nitrous oxide
• hydrofluorocarbons
• perfluorocarbons
• sulfur hexafluoride

According to the agency, the findings do not in and of themselves impose any emission reduction requirements but rather allow EPA to finalize the GHG standards proposed earlier this year for new light-duty vehicles as part of the joint rulemaking with the Department of Transportation.

EPA’S MANDATORY REPORTING OF GREENHOUSE GASES RULE

The EPA has issued a Final Mandatory Reporting of Greenhouse Gases Rule as per the Consolidated Appropriations Act of 2008 (H.R. 2764; Public Law 110–161). The rule requires reporting of greenhouse gas (GHG) emissions from large sources and suppliers in the United States and is intended to collect emissions data that would be utilized in shaping future policymaking.
Under the rule, suppliers of fossil fuels or industrial greenhouse gases, manufacturers of vehicles and engines, and facilities that emit 25,000 metric tons or more per year of GHG emissions are required to submit annual reports to EPA. The gases covered by the proposed rule are carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), hydrofluorocarbons (HFC), perfluorocarbons (PFC), sulfur hexafluoride (SF6), and other fluorinated gases including nitrogen trifluoride (NF3) and hydrofluorinated ethers (HFE). The rule will be effective December 29, 2009 and applies to roughly 10,000 facilities nationwide.
The first annual reports for the largest emitting facilities, covering calendar year 2010, will be submitted to EPA in 2011. Vehicle and engine manufacturers outside of the light-duty sector will begin phasing in GHG reporting with model year 2011. Some source categories included in the proposed rule are still under review.

EXEMPT COMPOUNDS ADDED TO SCAQMD RULE 102

Based on EPA findings, the South Coast AQMD has added Methyl Formate and Propylene Carbonate to its list of exempt compounds found in Rule 102 —Definition of Terms. Methyl Formate was “delisted” from EPA’s VOC list in 2004. Effective February 2009, dimethyl carbonate and propylene carbonate were added to the list of VOC exempt compounds on the basis that they are less photochemically reactive than ethane, and thus, have negligible contribution to tropospheric ozone formation.

SCAQMD staff recommended exempting these three compounds from the VOC definition to provide product formulators and end users with added compliance flexibility in formulating and using new compliant products such as adhesives, coatings, ink, solvents, foam blowing agents and others.
The Printing Industry Association supported the exemption of DMC noting that both dimethyl and propylene carbonate would be beneficial to providing low-VOC UV wash, which up to now have been difficult to find with the existing portfolio of choices. During the public hearing, the PIA representative indicated that without the exemptions, low-VOC cleaner manufacturers remain handicapped in providing the low-VOC solvent with good cleaning capability that would be suitable for use in the South Coast Basin.

The board opted to exempt only methyl formate and propylene carbonate and elected not to exempt dimethyl carbonate (DMC). The decision not to exempt DMC was prompted by comments from environmental groups and the Institute for Research and Technology Assistance (IRTA), which cited a study on dimethyl carbonate that indicates the chemical compound causes developmental toxicity in mice exposed by inhalation

SCAQMD RULE 1145—PLASTIC, RUBBER AND GLASS COATINGS AMENDMENTS

Rule 1145 was amended in December 2009, mainly to reflect findings under the U.S. EPA Control Techniques Guidelines (CTG), which recommended a maximum Volatile Organic Compound (VOC) limit of 680 grams per liter (G/L) for the multi-color coating category. The amendment also included an exemption for a refrigeration cabinet glass door manufacturer, that has been operating under a variance from Rule 1145 since February 2008. The manufacturer claimed to have a “niche coating operation” that was out of compliance with the rule prior to the December revisions. Staff reported that the manufacturer was unable to find a suitable low-VOC coating that could meet their performance requirements and be compliant with the two-component coating category previously limited at 120 g/L VOC in Rule 1145.
Although the District did not specify a specific timeframe, the agency did give a commitment to revisit the issue. The resolution language reads:

“Be it further resolved that the AQMD Governing Board hereby directs staff to reevaluate opportunities for further emission reductions from the refrigerated glass door coatings category of Rule 1145 – Plastic, Rubber, Leather and Glass Coatings – as part of the next amendment of the rule in the event compliant and adequately performing coatings are identified in the future.”

CLEAN AIR ACT FEES DECISION POSTPONED AGAIN

Once more, the SCAQMD board decided to postpone a decision on Rule 317- Clean Air Act Non-Attainment Fees. Under a requirement of the Clean Air Act, air districts in non-attainment areas must assess “non-attainment fees” in addition to their already existing fees. Due to strong industry opposition to the added emissions tax, the board directed staff to halt the rulemaking until the EPA issued clear guidance on the issue.

At the December 2009 board meeting, staff reported that EPA guidance had not been finalized but that a decision in a similar rulemaking in the San Joaquin Valley District was expected from EPA sometime in December. Staff believes that the EPA decision would serve to clarify the outstanding issues. The board unanimously voted to postpone action on Rule 317 until January 2010.

CLIMATE CHANGE TALKS AT COPENHAGEN

The United States was one of 194 countries represented at a two week conference focusing on climate change held in Copenhagen, Denmark. President Obama described the event as a forum where “all major economies have come together to accept their responsibility to take action to confront the threat of climate change.” The President also reiterated a commitment to “comprehensive legislation” in the U.S that would serve as a “foundation for our leadership around the world.” The President outlined his vision of three components: 1) transparency, 2) mitigation and 3) finance, which he believes are necessary to achieve results in a global climate change program.
The end result was an “accord” which was noted by participants but was not voted on nor signed and is not legally binding. An effort is underway to make the accord an actual treaty in 2010. Developed countries, including the United States, will outline a range of emission reduction targets up to year 2020 by February 1, 2010.
The Copenhagen accord includes the following:

• The U.S. and other developed countries will help raise $100 billion per year by 2020 to help developing nations with climate change mitigation and adaptation. The mitigations will be subject to verification but details on the implementation have not been disclosed at this point.
• Developed nations also agreed to provide some $30 billion in aid between 2010 and 2012, with the U.S. pledging $3.6 billion of that amount.
• The establishment of “guidelines” for international “consultations and analysis,” with a caveat that “national sovereignty is respected.”
• China, now the world’s largest emitter of carbon, agreed to cut its “carbon intensity” by between 40% and 45% by 2020. Carbon intensity is defined as the amount of carbon emitted per dollar of gross domestic product (GDP). India, offered to reduce its carbon intensity by between 20% and 25% by 2020. Since carbon intensity is different from overall greenhouse gas emissions, these reduction targets could be met while overall emissions could increase.
• State parties agreed to a non-binding goal of limiting global warming by 2 degrees Celsius.

During the Copenhagen conference, U.S. Energy Secretary, Steven Chu, announced the launch of a new initiative to promote clean energy technologies in developing countries. According to the Department of Energy, the Renewables and Efficiency Deployment Initiative (Climate REDI) will “accelerate deployment of renewable energy and energy efficiency technologies in developing countries – reducing greenhouse gas emissions, fighting energy poverty and improving public health for the most vulnerable, particularly women and children.”
Climate REDI includes three new clean energy technology programs and funding needed to launch a renewable energy program under the World Bank’s Strategic Climate Fund:

• The Solar and LED Energy Access Program will accelerate deployment of affordable solar home systems and LED lanterns to those without access to electricity.
• The Super-efficient Equipment and Appliance Deployment Program will harness the market and convening power of Major Economies Forum (MEF) countries to improve efficiency for appliances traded throughout the world.
• The Clean Energy Information Platform will establish an online platform for MEF countries to exchange technical resources, policy experience and the infrastructure to coordinate various activities in deploying clean energy technologies, and share this information with the world.
• The Scaling-up Renewable Energy Program (S-REP) under the World Bank’s Strategic Climate Fund will provide policy support and technical assistance to low-income countries developing national renewable energy strategies and underwrite additional capital costs associated with renewable energy investments.

The combined budget for these programs is $350 million over five years.