DAR File No. 42107

Environmental Quality, Air Quality

Rule R307-150

Emission Inventories

Notice of Proposed Rule

(Amendment)

DAR File No.: 42107
Filed: 09/14/2017 04:43:28 PM

RULE ANALYSIS

Purpose of the rule or reason for the change:

The purpose of this rule change is to implement a permit-by-rule system for oil and gas sources. The permit-by-rule system will eventually replace the current minor source permitting system that is implemented by the Division of Air Quality (Division). Rule R307-150 requires the submission of emission inventories from oil and gas sources. The inventories will enable the Division to improve compliance with current requirements and inform the Division as to what sources exist in the state.

Summary of the rule or change:

The rule requires certain oil and gas sources to submit an emissions inventory every three years for each of the emission units.

Statutory or constitutional authorization for this rule:

• Section 19-2-104

Anticipated cost or savings to:

the state budget:

This rule does not have a cost or savings to the state budget because this rule regulates oil and gas sources.

local governments:

This rule does not have a cost or savings to local governments because this rule regulates oil and gas sources.

small businesses:

This rule does have an impact on about 10 small businesses. This impact is discussed in the department head's fiscal analysis. Assuming completing and submitting an inventory takes about two hours per well site and a company pays someone $75 an hour to complete the inventory, the cost of the rule will be approximately $150 per well site. This cost will be the same for small and large businesses. Since the inventory is only required every three years, the ongoing cost will be approximately $50 per well site annually. The Division has considered methods of reducing the negative impact of the rule on small businesses in accordance with Subsection 63G-3-301(6) but cannot establish any additional less stringent requirements, schedules, or deadlines; simplify compliance or reporting requirements; replace design standards with performance standards; or exempt small businesses. However, through the stakeholder process, the Division made several changes to this rule and other rules involved in the permit-by-rule scheme that reduced costs for small businesses. One consideration that the Division took into account was to provide easy and cost efficient reporting requirements. The inventories are only required to be submitted once every three years. The Division is also creating a web app that allows businesses to submit their reports electronically. Small businesses and other businesses have also been given ample time and notice that inventories will be required.

persons other than small businesses, businesses, or local governmental entities:

No--This rule does not have a cost or savings to "other persons" because the rule impacts owners or operators of oil and gas wells. The owners and operators of these wells are all businesses.

Compliance costs for affected persons:

The compliance cost is about $50 per well on an annual basis. Details of the cost analysis and compliance costs are under the department head's comments below.

Comments by the department head on the fiscal impact the rule may have on businesses:

I. WHETHER A FISCAL IMPACT TO BUSINESS IS EXPECTED AS A RESULT OF THE PROPOSED RULE AND,IF SO, A DESCRIPTION OF WHY: The Division of Air Quality (Division) has identified 30 companies that may be impacted by this rule. This rule requires each company to submit an emissions inventory every three years that includes "the total emissions for PM10, PM2.5, oxides of sulfur, oxides of nitrogen, carbon monoxide and volatile organic compounds for each emission unit at the source" (Subsection R307-150-9(a)). The cost will depend on the amount of time and the amount of money the company chooses to pay its staff to prepare the inventory. II. AN ESTIMATE OF THE TOTAL NUMBER OF BUSINESS ESTABLISHMENTS IN UTAH EXPECTED TO BE IMPACTED: The Division has identified 30 companies that may be impacted by this rule. Collectively, these companies own approximately 3,500 wells that are located on state land. III. AN ESTIMATE OF THE SMALL BUSINESS ESTABLISHMENTS IN UTAH EXPECTED TO BE IMPACTED: Of the 30 companies that will be impacted, at least 10 are small businesses. IV. A DESCRIPTION OF THE SOURCES OF COST OR SAVINGS AS WELL AS THE EXPECTED NET SAVINGS OR COST TO BUSINESS ESTABLISHMENTS AND SMALL BUSINESS ESTABLISHMENTS AS A RESULT OF THE PROPOSED RULE OVER A ONE-YEAR PERIOD, IDENTIFYING ONETIME AND ONGOING COSTS: The source of the cost to companies as a result of this rule is the requirement to submit an emissions inventory every three years that includes "the total emissions for PM10, PM2.5, oxides of sulfur, oxides of nitrogen, carbon monoxide and volatile organic compounds for each emission unit at the source" (Subsection R307-150-9(a)). The inventory must also include "the type and efficiency of air pollution control equipment". This inventory is submitted in an electronic format, and staff at the Division are working to create a web application that will allow companies to submit their inventories online. Many of the companies impacted by this rule already have the data necessary for the inventory, which will make the fiscal impact of this rule minimal. Companies that do not have the data readily available should be able to calculate the data fairly easily. The cost will depend on the amount of time and the amount of money the company chooses to pay its staff to prepare the inventory. The cost to businesses over a one-year period will also vary depending on the amount of regulated equipment that is owned by the company. Initially, there may be a one-time cost to businesses to set up a database where they can track information related to the inventory. This should consist of an excel spreadsheet and may cost a few hundred dollars of staff time to organize. This one time cost would be less for small businesses because there are fewer sites to account for. After the database is set up, the costs will be the result of staff time used to input new information every three years to create an inventory and submit it to the Division of Air Quality. Assuming this takes about two hours per well site, and a company pays someone $75 an hour to complete the inventory, the cost of the rule will be approximately $150 per well site. This cost will be the same for small and large businesses. Since the inventory is only required every three years, the ongoing cost will be approximately $50 per well site annually. V. DEPARTMENT HEAD'S COMMENTS ON THE ANALYSIS: The above analysis represents DAQ's best estimate as to the fiscal impact this rule amendment will have on businesses. DAQ staff anticipate that most companies will already have access to a majority of the data that is required for the inventory. This ensures that any costs discussed in the analysis are minimal. The Division welcomes comments during the public comment period that provide further information regarding costs or savings that may result from the amendments being proposed.

Alan Matheson, Executive Director

The full text of this rule may be inspected, during regular business hours, at the Office of Administrative Rules, or at:

Environmental Quality
Air QualityRoom Fourth Floor
195 N 1950 W
SALT LAKE CITY, UT 84116-3085

Direct questions regarding this rule to:

• Mat Carlile at the above address, by phone at 801-536-4116, by FAX at 801-536-4136, or by Internet E-mail at [email protected]

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

11/15/2017

Interested persons may attend a public hearing regarding this rule:

• 10/25/2017 01:00 PM, TriCounty Health, 133 South 500 East, Vernal UT
• 10/19/2017 01:00 PM, Department of Environmental Quality, 195 North 1950 West, Board Room 1015, Salt Lake City, UT

This rule may become effective on:

01/04/2018

Authorized by:

Bryce Bird, Director

R307. Environmental Quality, Air Quality.

R307-150. Emission Inventories.

R307-150-1. Purpose and General Requirements.

(1) The purpose of [R305]R307-150 is:

(a) to establish by rule the time frame, pollutants, and information that sources must include in inventory submittals; and

(b) to establish consistent reporting requirements for stationary sources in Utah to determine whether sulfur dioxide emissions remain below the sulfur dioxide milestones established in the State Implementation Plan for Regional Haze, section XX.E.1.a, incorporated by reference in R307-110-28.

(2) The requirements of R307-150 replace any annual inventory reporting requirements in approval orders or operating permits issued prior to December 4, 2003.

(3) Emission inventories shall be submitted on or before ninety days following the effective date of this rule and thereafter on or before April 15 of each year following the calendar year for which an inventory is required. The inventory shall be submitted in a format specified by the Division of Air Quality following consultation with each source.

(4) The executive secretary may require at any time a full or partial year inventory upon reasonable notice to affected sources when it is determined that the inventory is necessary to develop a state implementation plan, to assess whether there is a threat to public health or safety or the environment, or to determine whether the source is in compliance with R307.

(5) Recordkeeping Requirements.

(a) Each owner or operator of a stationary source subject to this rule shall maintain a copy of the emission inventory submitted to the Division of Air Quality and records indicating how the information submitted in the inventory was determined, including any calculations, data, measurements, and estimates used. The records under R307-150-4 shall be kept for ten years. Other records shall be kept for a period of at least five years from the due date of each inventory.

(b) The owner or operator of the stationary source shall make these records available for inspection by any representative of the Division of Air Quality during normal business hours.

 

R307-150-2. Definitions.

The following additional definitions apply to R307-150.

"Acute pollutant" means any noncarcinogenic air pollutant for which a threshold limit value - ceiling (TLV-C) has been adopted by the American Conference of Governmental Industrial Hygienists in its "Threshold Limit Values for Chemical Substances and Physical Agents and Biological Exposure Indices," 2003 edition.

"Carcinogenic pollutant" means any air pollutant that is classified as a known human carcinogen (A1) or suspected human carcinogen (A2) by the American Conference of Governmental Industrial Hygienists in its "Threshold Limit Values for Chemical Substances and Physical Agents and Biological Exposure Indices," 2003 edition.

"Chronic Pollutant" means any noncarcinogenic air pollutant for which a threshold limit value - time weighted average (TLV-TWA) having no threshold limit value - ceiling (TLV-C) has been adopted by the American Conference of Governmental Industrial Hygienists in its "Threshold Limit Values for Chemical Substances and Physical Agents and Biological Exposure Indices," 2003 edition.

"Dioxins" and "Furans" mean total tetra- through octachlorinated dibenzo-p-dioxins and dibenzofurans.

"Emissions unit" means emissions unit as defined in R307-415-3.

"Large Major Source" means a major source that emits or has the potential to emit 2500 tons or more per year of oxides of sulfur, oxides of nitrogen, or carbon monoxide, or that emits or has the potential to emit 250 tons or more per year of PM10, PM2.5, volatile organic compounds, or ammonia.

"Lead" means elemental lead and the portion of its compounds measured as elemental lead.

"Major Source" means major source as defined in R307-415-3.

 

R307-150-3. Applicability.

(1) R307-150-4 applies to all stationary sources with actual emissions of 100 tons or more per year of sulfur dioxide in calendar year 2000 or any subsequent year unless exempted in (a) below. Sources subject to R307-150-4 may be subject to other sections of R307-150.

(a) A stationary source that meets the requirements of R307-150-3(1) that has permanently ceased operation is exempt from the requirements of R307-150-4 for all years during which the source did not operate at any time during the year.

(b) Except as provided in [(a) above]R307-150-3(1)(a), any source that meets the criteria of R307-150-3(1) and that emits less than 100 tons per year of sulfur dioxide in any subsequent year shall remain subject to the requirements of R307-150-4 until 2018 or until the first control period under the Western Backstop Sulfur Dioxide Trading Program as established in R307-250-12(1)(a), whichever is earlier.

(2) R307-150-5 applies to large major sources.

(3) R307-150-6 applies to:

(a) each major source that is not a large major source;

(b) each source with the potential to emit 5 tons or more per year of lead; and

(c) each source not included in R307-150-3(2), [or] R307-150-3(3)(a), or R307-150-3(3)(b) [above] that is located in Davis, Salt Lake, Utah, or Weber Counties and that has the potential to emit 25 tons or more per year of any combination of oxides of nitrogen, oxides of sulfur and PM10, or the potential to emit 10 tons or more per year of volatile organic compounds.

(4) R307-150-7 applies to Part 70 sources not included in [(2) or (3) above]R307-150-3(2) or R307-150-3(3).

(5) R307-150-9 applies to sources with Standard Industrial Classification codes in the major group 13 that have actual emissions greater than one ton per year. These sources include, but are not limited to, industries involved in oil and natural gas exploration, production, and transmission operations; well production facilities; natural gas compressor stations; and natural gas processing plants and commercial oil and gas disposal wells, ponds and sites.

(a) Sources that require inventory submittals under R307-150-3(1) through R307-150-3(4) are excluded from the requirements of R307-150-9.

 

R307-150-4. Sulfur Dioxide Milestone Inventory Requirements.

(1) Annual Sulfur Dioxide Emission Report.

(a) Sources identified in R307-150-3(1) shall submit an annual inventory of sulfur dioxide emissions beginning with calendar year 2003 for all emissions units including fugitive emissions.

(b) The inventory shall include the rate and period of emissions, excess or breakdown emissions, startup and shut down emissions, the specific emissions unit that is the source of the air pollution, type and efficiency of the air pollution control equipment, percent of sulfur content in fuel and how the percent is calculated, and other information necessary to quantify operation and emissions and to evaluate pollution control efficiency. The emissions of a pollutant shall be calculated using the source's actual operating hours, production rates, and types of materials processed, stored, or combusted during the inventoried time period.

(2) Each source subject to R307-150-4 that is also subject to 40 CFR Part 75 reporting requirements shall submit a summary report of annual sulfur dioxide emissions that were reported to the Environmental Protection Agency under 40 CFR Part 75 in lieu of the reporting requirements in (1) above.

(3) Changes in Emission Measurement Techniques. Each source subject to R307-150-4 that uses a different emission monitoring or calculation method than was used to report their sulfur dioxide emissions in 2006 under R307-150 or 40 CFR Part 75 shall adjust their reported emissions to be comparable to the emission monitoring or calculation method that was used in 2006. The calculations that are used to make this adjustment shall be included with the annual emission report.

 

R307-150-5. Sources Identified in R307-150-3(2), Large Major Source Inventory Requirements.

(1) Each large major source shall submit an emission inventory annually beginning with calendar year 2002. The inventory shall include PM10, PM2.5, oxides of sulfur, oxides of nitrogen, carbon monoxide, volatile organic compounds, and ammonia for all emissions units including fugitive emissions.

(2) For every third year beginning with 2005, the inventory shall also include all other chargeable pollutants and hazardous air pollutants not exempted in R307-150-8.

(3) For each pollutant specified in (1) or (2) above, the inventory shall include the rate and period of emissions, excess or breakdown emissions, startup and shut down emissions, the specific emissions unit that is the source of the air pollution, composition of air pollutant, type and efficiency of the air pollution control equipment, and other information necessary to quantify operation and emissions and to evaluate pollution control efficiency. The emissions of a pollutant shall be calculated using the source's actual operating hours, production rates, and types of materials processed, stored, or combusted during the inventoried time period.

 

R307-150-6. Sources Identified in R307-150-3(3).

(1) Each source identified in R307-150-3(3) shall submit an inventory every third year beginning with calendar year 2002 for all emissions units including fugitive emissions.

(a) The inventory shall include PM10, PM2.5, oxides of sulfur, oxides of nitrogen, carbon monoxide, volatile organic compounds, ammonia, other chargeable pollutants, and hazardous air pollutants not exempted in R307-150-8.

(b) For each pollutant, the inventory shall include the rate and period of emissions, excess or breakdown emissions, startup and shut down emissions, the specific emissions unit which is the source of the air pollution, composition of air pollutant, type and efficiency of the air pollution control equipment, and other information necessary to quantify operation and emissions and to evaluate pollution control efficiency. The emissions of a pollutant shall be calculated using the source's actual operating hours, production rates, and types of materials processed, stored, or combusted during the inventoried time period.

(2) Sources identified in R307-150-3(3) shall submit an inventory for each year after 2002 in which the total amount of PM10, oxides of sulfur, oxides of nitrogen, carbon monoxide, or volatile organic compounds increases or decreases by 40 tons or more per year from the most recently submitted inventory. For each pollutant, the inventory shall meet the requirements of R307-150-6(1)(a) and (b).

 

R307-150-7. Sources Identified in R307-150-3(4), Other Part 70 Sources.

(1) Sources identified in R307-150-3(4) shall submit the following emissions inventory every third year beginning with calendar year 2002 for all emission units including fugitive emissions.

(2) Sources identified in R307-150-3(4) shall submit an inventory for each year after 2002 in which the total amount of PM10, oxides of sulfur, oxides of nitrogen, carbon monoxide, or volatile organic compounds increases or decreases by 40 tons or more per year from the most recently submitted inventory.

(3) The emission inventory shall include individual pollutant totals of all chargeable pollutants not exempted in R307-150-8.

 

R307-150-8. Exempted Hazardous Air Pollutants.

(1) The following air pollutants are exempt from this rule if they are emitted in an amount less than that listed in Table 1.

 

TABLE 1

POLLUTANT             Pounds/year

Arsenic                    0.21

Benzene                   33.90

Beryllium                  0.04

Ethylene oxide            38.23

Formaldehyde               5.83

 

(2) Hazardous air pollutants, except for dioxins or furans, are exempt from being reported if they are emitted in an amount less than the smaller of the following:

(a) 500 pounds per year; or

(b) for acute pollutants, the applicable TLV-C expressed in milligrams per cubic meter and multiplied by 15.81 to obtain the pounds-per-year threshold; or

(c) for chronic pollutants, the applicable TLV-TWA expressed in milligrams per cubic meter and multiplied by 21.22 to obtain the pounds-per-year threshold; or

(d) for carcinogenic pollutants, the applicable TLV-C or TLV-TWA expressed in milligrams per cubic meter and multiplied by 7.07 to obtain the pounds-per-year threshold.

 

R307-150-9. Crude Oil and Natural Gas Source Category

(1) Sources identified in R307-150-3(5) shall submit an inventory every third year beginning with the 2017 calendar year for all emission units.

(a) The inventory shall include the total emissions for PM10, PM2.5, oxides of sulfur, oxides of nitrogen, carbon monoxide and volatile organic compounds for each emission unit at the source. The emissions of a pollutant shall be calculated using the emission unit's actual operating hours, product rates, and types of materials processed, stored, or combusted during the inventoried time period. (b) The inventory shall include the type and efficiency of air pollution control equipment.

(c) The inventory shall be submitted in an electronic format determined by the Director specific to this source category.

 

KEY: air pollution, reports, inventories

Date of Enactment or Last Substantive Amendment: [December 15, 2015]2017

Notice of Continuation: January 28, 2014

Authorizing, and Implemented or Interpreted Law: 19-2-104(1)(c)