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 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 an Annual Emissions Report Package. However, it is the operator’s responsibility to file a report if necessary, even if the facility does not receive a notification from SCAQMD.
• Facilities which prior to July 1, 2000 had equipment listed as exempt.  There is no fee associated with these exempt emissions but they must be reported.

What if I miss the deadline?
The SCAQMD 2012 Annual Emissions Report (AER) is due by 5:00 p.m. on March 5, 2013.  The Report applies to the Calendar Year 2012 reporting period (January 1, 2012 – December 31, 2012).  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 follows:

After submitting my report I found out I estimated emissions incorrectly
Companies that pay their emissions fees on time but underestimated their emissions, which resulted in underpayment to SCAQMD, can resubmit 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, 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
As of January 1, 2008, facilities were required to report emissions on a calendar year basis (from January 1 to December 31 of the reporting year). It is a web-based program.

• New emission fee rates are in effect for the 2012 Annual Emission Reporting Program for criteria pollutants, toxic air contaminants, and ozone depleting compounds in accordance with AQMD Rule 301(e).
• For 2012 AER, facilities in Phase 1B are required to file their 2588 Quadrennial Report.
• SOx default emission factor for combustion equipment burning diesel fuel has been updated.

Special circumstances
The AQMD has a Fee Review Committee to handle issues regarding fees and penalties. The agency requires records related to the AER to be kept for a minimum of five years.

AIR QUALITY MANAGEMENT PLAN

With an administrative record of over 4,000 pages and 5 hours of public testimony from over 80 speakers, the South Coast Air Quality Management Plan (AQMP) was adopted by the agency’s governing board. Key elements of the 2012 AQMP include additional emissions reductions from the RECLAIM program and episodic curtailment of residential wood burning and open burning. According to staff, these control measures are necessary in order to meet the 24-hour PM 2.5 Federal Standard (the deadline to meet the federal 24-hour PM2.5 standard is 2014). Staff reported that the District also must develop and implement provide for contingency measures in case the targeted attainment date is missed. AQMD is proposing to the Environmental Protection Agency that the excess reductions from both the residential wood burning and open burning controls should be considered sufficient to demonstrate compliance with the federal requirements.

The agency reported that “Although the Basin is projected to meet PM standards by the relevant attainment deadlines with the strategy mentioned above, significant challenges remain in meeting federal ozone standards.” On that basis, the next AQMP in 2015 will include a full 2023 attainment demonstration of the 8-hour ozone standard. The District vowed to pursue actions that can be taken over the next 2 to 3 years to work towards meeting the 8-hour ozone standard. Proposed measures include reductions from coatings, consumer products and RECLAIM facilities, as well as early transitions to zero and near-zero emission technologies.
The board deviated from its traditional approach to rulemaking by becoming extremely involved in the shaping of the final proposal. Typically, the board adopts staff recommendations verbatim. Citing a multitude of meetings with stakeholder groups that had taken place prior to the adoption hearing, various board members made motions to alter the staff proposal significantly. Some of the beneficiaries included the American Coatings Association (ACA) and the consumer products industry. ACA advocated for the removal of the proposed VOC reduction control measures – CTS-01, CTS-02, CTS-03, and CTS-04 – from the 2012 AQMP, stating that the District is not required to address ozone in the 2012 plan. ACA “stressed the significant strides the paint and coatings industry has made in reducing its products’ VOC emissions in the past, noting that the District should focus on other source categories for further emissions reductions instead of unfairly targeting the coatings industry.” The District has added language allowing for flexibility in the future and made assurances that any specific requirements will be based on technical and economic concerns. The SCAQMD Governing Board also removed the Low Vapor Pressure exemption via the CTS-04 control measure for Further Reductions from Consumer Products. CTS-04 proposed to change the definition of the Low Vapor Pressure-Volatile organic Compound (LVP-VOC) in the California Air Resources Board (CARB) regulation. Industry argued that SCAQMD did not have jurisdiction over the Consumer Product issues, including the LVP-VOC definition. The board voted unanimously to remove the control measure from the plan—a move being hailed as the “LVP Victory” by industry groups. Industry will undoubtedly remain vigilant as the District vowed to send a letter to the state’s Air Resources Board to address the LVP issue.
Representatives from the ports of Los Angeles and Long Beach were unsuccessful in getting the agency to back away from more stringent requirements related to emissions associated with port operations. Another significant board action was the inclusion of provisions to provide incentives rather than overly focusing on mandates, and a strong directive to staff to improve the relationship with industry representatives.

RULE 1147—NOX REDUCTIONS FROM MISCELLANEOUS SOURCES

SCAQMD Rule 1147 establishes nitrogen oxide (NOx) emission limits for a wide variety of combustion equipment. It affects new and existing (in-use) combustion equipment requiring permits that are not regulated by other AQMD NOx rules. The district has published a “compliance advisory” which further clarifies that units with documented emissions of one pound per day or less of NOx are eligible for a five year delay of the July 1, 2012 compliance date. To obtain this delay you must document that a unit’s emissions are 1 pound per day or less by maintaining daily records of operating hours or fuel use for each unit. By rule a unit rated less than or equal to 400,000 BTU/hour is eligible for the 5 year delay. SCAQMD estimates that out of the 6,500 units subject to the rule, 2,500 or more would be eligible for the “one pound per day or less” exemption.
The district is now required to do a technology assessment, a cost effectiveness study and an affordability study. The California Autobody Association and various industry groups have provided comments to the agency throughout 2012.

PROPOSITION 39

The recent passage of California Proposition 39 resulted in a tax formula change for businesses that own companies in various states. The measure is intended to provide funding to clean energy and energy efficient projects for public buildings, but business groups say it will make the state less business friendly.

Prop. 39 requires multistate businesses to calculate their California income tax liability based on the percentage of their sales in California. It repeals existing law giving multistate businesses an option to choose a tax liability formula that provides flexibility for businesses with property and payroll outside California. The change is estimated to generate approximately $1 billion in additional annual state revenues with $550 million per year going towards funding projects that create energy efficiency and clean energy jobs in California. Of the remaining revenues, a significant portion likely would be spent on public schools and community colleges.

SCAQMD REVISES LIST OF TOXIC AIR CONTAMINANTS

Rules 1401 (New Source Review to Toxic Air Contaminants) and 1402 (Control of Toxic Air Contaminants from Existing Sources) require the South Coast Air Quality Management District to notify its Board and affected parties when health risk values for toxic air contaminants are added to or changed in Rule 1401, as well as analyze the potential impacts of new, modified and existing sources subject to Rules 1401 and 1402. The Office of Environmental Health Hazard Assessment (OEHHA) has recently amended risk values for:

• nickel and nickel compounds;
• polychlorinated biphenyls (PCB);
• polychlorinated dibenzo-p-dioxins (PCDD); and
• polychlorinated dibenzofurans (PCDF).

Since these are all amended values rather than new values, no amendment to Rule 1401 or R1402 are required but risk assessment calculations will need to reflect the new values. The updated toxicity equivalency factors (TEFs) and the addition of oral pathway factors result in more stringent chronic and cancer risk values for some PCDD, PCDF and PCB compounds and less stringent for certain PCDF and PCB compounds. The revised health risk values are shown in Table 1 – Existing and Revised Health Risk Values and Screening Values for PCDDs, PCDFs, and Dioxin-like PCBs at www.aqmd.gov. In addition, on March 23, 2012, the OEHHA adopted revised acute, 8-hour and chronic reference exposure levels (RELs) for nickel and nickel compounds. The revised chronic and acute RELs for nickel and nickel compounds are more stringent than the existing values.

Analysis of toxics emissions data found the primary sources of the PCDD, PCDF and PCB compounds to be landfill gas-fired combustion equipment and various chemical manufacturing processes. Other sources of PCDD and PCB compounds included pesticide/insecticide manufacturing and secondary metal production. Sources of emissions of nickel and nickel compounds, included fuel combustion processes, metal processes, plating operations, asphalt/cement manufacturing, abrasive blasting operations and surface coating operations.

PROP 65

California’s chemical law known as Proposition 65 requires the State of California to publish a list of chemicals known to cause cancer, birth defects or other reproductive harm. Manufacturers and/or distributors selling products in CA must label products with a Toxicity Warning if the product contains any chemical on the list. The following substances were added to the list in 2012:

• Isopyrazam
• 3,3′,4,4′ Tetrachloroazobenzene
• 2-Methylimidazole (found in caramel coloring in food additives, epoxy systems and in pharmaceutical manufacturing)
• Benzophenone (used in making inks and coatings, as food ingredients for flavor, in soaps, plastics and adhesives)
• Coconut oil diaethanolamine condensate (used in cosmetics, soaps, shampoos and other personal care products)
  Diethanolamine (used in the production of diethanolamides which are used in cosmetics, soaps, shampoos and other personal care products)

RULE 219 AND RULE 222 PROPOSALS

The SCAQMD is proposing amendments to Rule 219 (Equipment not requiring a written permit pursuant to Regulation II) and Rule 222 (Filing Requirements for Specific Emission Sources Not Requiring a Written Permit Pursuant to Regulation II). The proposed amendments will exempt specified equipment from permitting and will add equipment to the AQMD filing program. The following equipment is proposed to be added to Rule 219:

• Laser cutting, etching and engraving equipment
• Machining equipment—granulating
• Multi-family residential, non-commercial charbroilers
• Cosmetic filling stations
• Carpet shearing machines
• Aerosol can recycling equipment

The equipment categories impacted by the changes to Rule 222 involve Rule 1147 sources such as:

• Asphalt day tankers
• Asphalt pavement heaters
• Diesel fuel boilers ≤ 2 MMBtu/Hour, 4000 ft above sea level or 15 mi offshore
• Food convection ovens ≤ 2 MMBtu/Hour
• Fuel Cells with heaters that provide supplemental heat, ≤ 90,000 Therms per year
• Microturbines or other distributed generation systems, certified by the State and with less than 3.5 MMBtu/Hour
• Power pressure washers ≤ 2 MMBtu/Hour, 50 gallon fuel per day
• Tar pots

The filing fee under Rule 222 for the equipment at issue is $173.56, which is less than that for permitting that ranges from $1,364.63 to $3,440.06.

DTSC SAFER CONSUMER PRODUCTS REGULATIONS

The California Department of Toxic Substances Control proposed the Safer Consumer Product Regulations in an attempt to reduce the amount of toxics in consumer products.
The agency issued a 30-day public notice and comment period concerning the public availability of external scientific peer review reports for the scientific basis of the regulations concerning safer consumer products. The DTSC is adding ten external scientific peer review reports to the Safer Consumer Products rulemaking, which was published in the California Regulatory Notice Register on July 27, 2012.
A public comment period for the external scientific peer review reports started on November 30, 2012, and closes at 5 p.m. on December 30, 2012.
(For additional background information please see ATI’s 1st Quarter 2012 newsletter)