SCAQMD Permit Streamlining Activities

The Permit Streamlining Task Force of the South Coast Air Quality Management District (SCAQMD) held a meeting to provide an update on the pending application inventory. Eighty percent of the agency’s engineering staff is currently teleworking due to Covid-19 restrictions and there is a 25% vacancy rate for engineering positions. New engineer recruitment is underway and recent positions filled include four Supervising Engineers and four Senior Engineers.

As of May 2021, there are 3,416 pending permit applications. In comparison, when the Governing Board announced the initiative to reduce the backlog in 2016, there were 7,348 pending applications. Approximately 70 percent of the pending applications are for the less complex equipment categories (Schedules A & B). A “Permit Application Status Dashboard” was created to increase transparency. Permit applicants will now have the ability to view the status of individual applications online. Some equipment, such as negative air machines for Asbestos and commercial charbroilers are eligible for online registration.

It was also announced that the Best Available Control Technology Team will now be part of the Engineering Division and that there is an effort underway to update the Permit Processing Handbook to reflect current requirements and practices.

Indirect Source Rule Passes

After many hours of public comments and debate, the South Coast Air Quality Management District (SCAQMD) adopted the controversial Indirect Source Rule (ISR) on a vote of 9 to 4. Rule 2305 (Warehouse Indirect Source Rule) brings in “indirect” sources – those that attract other sources of pollution but do not necessarily emit air contaminants directly– into the regulatory framework. The rule requires warehouses greater than 100,000 square feet to directly reduce emissions of Nitrogen Oxides (NOx) and diesel Particulate Matter (PM), or to facilitate emissions and exposure reductions of these pollutants. According to staff, “heavy-duty trucks are the largest source of NOx emissions in the South Coast Basin and warehouses are a key destination for trucks.” The rule imposes additional reporting and recordkeeping requirements on warehouse owners and operators.

The Warehouse Actions and Investments to Reduce Emissions (WAIRE) Program in the rule, is a menu-based points system that will require warehouse operators to annually earn a specified number of points by completing actions from a menu. Menu items include acquiring or using Near Zero Emissions (NZE) and/or Zero Emissions (ZE) on-road trucks, ZE cargo handling equipment, ZE charging/fueling infrastructure, solar panels, or particulate filters for nearby sensitive land uses. Alternatively, warehouse operators could “prepare and implement a custom plan specific to their site, or they could pay a mitigation fee.” The SCAQMD Board will have discretion on how to allocate the funds generated from the program and the fees are set forth in Rule 316.

Environmental groups expressed support for a strong ISR, pointing to adverse health impacts that disproportionately affect residents in disadvantaged communities due to the proliferation of warehouses. They stated that the logistics industry has seen record-breaking profits during the pandemic, due to increased e-commerce. They believe the warehouse ISR will protect workers and communities in the South Coast Air Basin and create projects and careers for skilled trade people. The business community opposed the rule because of increased costs of implementation to the logistics industry. According to industry representatives, the additional cost will be passed on to consumers and the rule will result in loss of jobs and businesses leaving the state. Various commenters questioned the jurisdictional/legal authority of the South Coast AQMD to impose fees that ultimately will not result in achievable and quantifiable emissions reductions or towards credits for the State Implementation Plan (SIP). Unavailability of technology needed to earn WAIRE Points, the ability of warehouse operators to control trucks that visit their facilities, and inadequate opportunity for the public to review the draft Environmental Assessment (EA) were also brought up as reasons for opposition.

After deliberations, the rule passed with an amendment to modify the Resolution to change the state of technology evaluation from five years to three, and provide contact information to identify whom businesses can call if they need assistance. Facilities will be phased in over a 3-year period based on size, and stringency of requirements will increase throughout this period. The first required report from warehouse owners would be due on September 1, 2021. The first 12-month compliance period for warehouse operators in warehouses greater than or equal to 250,000 square feet, between 150,000-249,999 square feet, and between 100,000-149,999 square feet will begin January 1, 2022, January 1, 2023, and January 1, 2024, respectively. Once initiated, each warehouse phase’s stringency will increase equally over a three-year period such that by the fifth year, all warehouses will be at the final stringency.

CARB Releases Proposed Regulation

Last year the California Air Resources Board (CARB) approved for adoption proposed amendments to the “Regulation for the Reporting of Criteria Air Pollutants and Toxic Air Contaminants” (CTR). According to CARB, the regulation is “part of a broader effort by CARB to improve inventories of airborne emissions from all sources within California, including emissions related to stationary sources (facilities with a fixed location), mobile sources (on-road and off-road), and area-wide sources (for example, airborne dust).” At the hearing, staff presented, and the Board approved for adoption, updates to the amended regulatory language developed in response to comments. These modifications include revisions to the applicability criteria, updates to the district phase-in schedule, refinements to sector phase-in timing, updates to the toxic substances subject to reporting, and minor updates to the reporting requirements in the regulation. The following is an overview of the modifications:

• Change the criteria pollutant applicability threshold for additional sources from 4 tons per year (tpy) to 10 tpy for District Group B (districts that do not currently have an AB 617 identified community and are in general the smaller air districts).
• For sources located in medium and rural air districts, which are subject to reporting under the “sector-based” applicability, provide an additional year before the requirements take effect, changing the start year from 2023 to 2024.
• For portable equipment reporting under CTR, include updates and clarifications such as requiring reporting of all emissions, including toxics, and include reporting of equipment registered under CARB’s Portable Equipment Registration Program (PERP).
• To provide additional time for emissions testing for the waste and wastewater sectors, delay reporting until 2028 data reported in 2029.
• Remove requirement to report release location (or stack) data parameters for some sources, unless specifically required by the local air district.
• Include minor updates to definitions for completeness and other modifications to clarify the requirements such as including an exemption for permitted open burning, providing a more complete explanation regarding reporting control efficiency data, and providing examples of data that may be submitted when reporting production or use data for toxics.
• The agency is in the process of reviewing public comments and a date for final approval of the amendments is to be determined.

AB 617 Program Updates

Assembly Bill (AB) 617 (C. Garcia) requires new community-focused actions to reduce air pollution and improve public health in communities that experience disproportionate burdens from exposure to air pollutants. To implement this statute, the California Air Resources Board (CARB) established the Community Air Protection program (CAP) which contains requirements for community emissions reduction programs, community air monitoring plans, and other elements of the program. Ten communities were selected to be the first to implement community emissions reduction programs, community air monitoring, or both. Since then, the Board has selected five additional communities for these targeted local actions. Once CARB selects a community to develop a community emissions reduction program, the local air district must collaborate with the community to develop and adopt a community emissions reduction program. Subsequently, the air district must submit the community emissions reduction program to CARB for consideration. CARB selected the community of Southeast Los Angeles for a community emissions reduction program in 2019. The South Coast Air Quality Management District (SCAQMD) worked with a community steering committee to develop the Southeast Los Angeles Community Emissions Reduction Plan (Plan) to reduce exposure to air pollution in the community. CARB approved the Plan at its June 2021 board meeting.

AB 617 also requires that CARB establish and maintain a statewide Technology Clearinghouse to “provide access to transparent information on criteria air pollutant and toxic air contaminant emissions limits for use in identifying opportunities to reduce emissions in communities throughout California.” According to CARB, the Technology Clearinghouse brings together existing policy, emissions limits, and control technology from California’s 35 air districts and CARB programs, along with information on cleaner-than-currently required technologies. Over the past three years, CARB has developed stand-alone prototype tools that serve two goals: to test needed functionality for the final system and to serve immediate, short-term data needs until the full system is released. Staff will continue to request public feedback through focus groups on prototypes and begin working with external contractors in late 2021. The agency plans to release new prototype tools based on public needs.

SCAQMD Chairman Burke Retires

Dr. William A. Burke has retired after 27 years of service on the South Coast Air Quality Management District Board. He served as Chair for 23 of the 27 years. Chairman Burke officially stepped down on May 31, 2021. He is the longest-tenured member and the longest-serving chairman of the South Coast AQMD Governing Board. SCAQMD held a special election during which Board Member Ben Benoit was selected as the new Chairman and Board Member Vanessa Delgado was selected as Vice Chair.

Greenhouse Gas (GHG) Program

Cap-and-Trade was designed by the California Air Resources Board (CARB) pursuant to the Global Warming Solutions Act of 2006 (AB 32). It includes reducing California’s greenhouse gas emissions to 1990 levels by 2020 and achieving California’s 2030 greenhouse gas emissions target of 40 percent below 1990 levels (specified in AB 398). The Program applies to emissions that cover approximately 80 percent of the State’s GHG emissions. CARB creates allowances equal to the total amount of permissible emissions (i.e. “cap”). One allowance equals one metric ton of carbon dioxide equivalent emissions. Each year fewer allowances are created and the annual cap declines. An increasing annual auction reserve (or floor) price for allowances and the reduction in annual allowances creates a steady and sustained carbon price. The price serves as an indicator that may prompt actions to reduce GHG emissions. Major stationary sources, power plants and transportation fuels (added 2015) that emit over 25,000 metric ton equivalent of Carbon Dioxide per year are subject to the regulation. Emissions of Methane and other fluorinated gases are also counted. All covered entities in the Cap-and-Trade Program are still subject to existing air quality permit limits for criteria and toxic air pollutants.

SCAQMD staff recently provided an update on the GHG program. Staff described the program as a “comprehensive economy-wide mass based program” that covers all sectors of the state’s economy. According to the report the transportation sector accounts for 41% of GHG emissions in the state, 24% of emissions are from industrial sources, 15% are electricity related, 8% are agricultural related, and residential and commercial sources account for 7% and 5% of the emissions, respectively. Approximately 85% of the Greenhouse Gases emitted in the state are covered by the program. GHG emissions in California are decreasing even though the Gross Domestic Product (GDP) and population are increasing.

California’s program began in 2013 as part of the Western Climate Initiative (WCI) framework and is linked to participating WCI states/provinces — Quebec in Canada is the only participant in addition to California. Main emission reduction goals are to reach:

• 1990 emission levels (431 MMTCO2e) by 2020,
• 40% below 1990 levels by 2030 and,
• 80% below 1990 levels by 2050

Every quarter California has an auction of allowances. The program generates a tremendous amount of revenue. The revenue generated from the last auction which took place in May of 2021 was $650 million. Proceeds go to the Greenhouse Gas Reduction Fund (GGRF). The Legislature appropriates money from GGRF to fund administering agencies, such as CARB and the California Public Utility Commission for emission reduction programs. To date, approximately $14 billion has been appropriated. The proceeds from the auctions fund GHG emission reduction projects and address potential localized community impacts. State law requires 25% of the proceeds to be invested within and benefitting disadvantaged communities. There is an additional 10% for low income communities. Since 2014 over $7 Billion has been distributed to industry, small businesses, and residential households. Eleven million households receive the electric California Climate Credit and over 12 million households receive the natural gas California Climate Credit. Disadvantaged communities have received $400 million to “improve access to solar and clean energy technologies.” In 2017, the state had already met the 2020 emission goals of the GHG program.