vvEPA
United Scales
Environmental Protection
Agmrcy
REGULATORY IMPACT ANALYSIS FOR
THE FINAL PREVENTION OF
SIGNIFICANT DETERIORATION AND
TITLE V GREENHOUSE GAS TAILORING
RULE
Final Report
May 2010
Linda M. Chappell, PhD
U.S. Environmental Protection Agency
Office of Air Quality Planning and Standards
Air Benefits and Cost Group
109 TW Alexander Drive
Research Triangle Park, NC 27711
RTI International
3040 Cornwallis Road
Research Triangle Park, NC 27709
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EP A 452/R-10-003
May 2010
Regulatory Impact Analysis for the Final Greenhouse Gas Tailoring Rule
Final Report
Linda M. Chappell, PhD
U.S. Environmental Protection Agency
Office of Air Quality Planning and Standards
Air Benefits and Cost Group
109 TW Alexander Drive
Research Triangle Park, NC 27711
U.S. Environmental Protection Agency
Office of Air Quality Planning and Standards
Health and Environmental Impacts Division
Research Triangle Park, NC
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CONTENTS
Page
1 Executive Summary 4
1.0 Summary 5
1.1 Summary of Analytical Approach for the Analysis 9
1.2 Benefits, Cost, and Net Benefits of the Final Tailoring Rule 16
1.3 Organization of this Report 20
2 Baseline Description, Regulatory Alternatives, and Affected Entities 22
3 Benefits (Regulatory Relief or Avoided Permit Burden Costs) 34
3.1 Avoided Burden Costs for Title V 34
3.2 Avoided Information Collection Costs Associated with the PSD Program 38
4 Social Costs 45
5 Net Benefits 49
6 Impacts of Regulatory Relief 53
6.1 Method for Analyzing Avoided Economic and Small Entity Impacts 53
6.1.1 Identifying Affected Sectors and Entities 53
6.1.2 Data Used to Characterize Affected Entities by Size 54
6.2 Developing Economic and Small Entity Regulatory Relief Impact Measures 68
6.3 Implementing the Sales Test to Measure Impacts on Industrial, Commercial, and
Multifamily Residential Sources 68
6.4 Economic Relief to Permitting Authorities 70
7 Statutory and Executive Order Reviews 87
7.1 Executive Order 12866 - Regulatory Planning and Review 87
7.2 Paperwork Reduction Act 87
7.3 Regulatory Flexibility Act 88
7.4 Unfunded Mandates Reform Act 89
7.5 Executive Order 13132 -Federalism 89
7.6 Executive Order 13175 - Consultation and Coordination with Indian Tribal
Governments 90
7.7 Executive Order 13045 - Protection of Children from Environmental Health and
Safety Risks 90
7.8 Executive Order 13211 - Actions That Significantly Affect Energy Supply,
Distribution, or Use 91
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7.9 National Technology Transfer and Advancement Act 91
7.10 Executive Order 12898 - Federal Actions to Address Environmental Justice in
Minority Populations and Low-Income Populations 91
7.11 Congressional Review Act 92
8 Limitations and Uncertainties 93
9 References 99
Attachment A: Source Categories Affected by the Rule with Industry Detail
Attachment B: Technical Support Document for Greenhouse Gas Emissions Thresholds
Evaluation
Attachment C: Summary of Methodology and Data Used to Estimate Burden Relief and
Evaluate Resource Requirements at Alternative Greenhouse Gas (GHG)
Permitting Thresholds
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List of Tables
Page
1.0 Time Periods and Regulatory Alternatives Analyzed in the RIA 12
1.1 Annual Net Benefits for GHG Tailoring Rule Regulatory Alternatives 18
1.2 Net Benefits for the Final Rule and Regulatory Alternatives for Steps 1 and 2 of the
Phase-In Period 19
1.3 Net Benefits of the Final Rule and Step 3 Regulatory Alternatives 20
2.0 Phase-In Steps for Large Sources for the Final GHG Tailoring Rule 22
2.1 Baseline Sources Subject to Statutory Permit Requirements 29
2.2 Qualitative Description of Benefits and Cost of the Tailoring Rule 31
2.3 Estimated Number of Affected Sources Experiencing Regulatory Relief for Final
Rule and Regulatory Alternatives 32
3.0 Annual Title V Regulatory Relief (Avoided Cost) Estimates for Affected Sources
of GHG and Permitting Authorities at Alternative Thresholds 36
3-1 Steps 1 and 2 Title V Regulatory Relief (Avoided Cost) Estimates for Affected
Sources of GHG and Permitting Authorities at Alternative Thresholds 39
3.2 Annual PSD Regulatory Relief (Avoided Costs) for Sources of GHG and
Permitting Authorities at Alternative Thresholds 40
3.3 Step 1 and 2 PSD Regulatory Relief (Avoided Costs) for Sources of GHG and
Permitting Authorities at Alternative Thresholds 43
3.4 Benefits of the Final Rule and Step 3 Regulatory Alternatives 44
5.1 Annual Net Benefits for GHG Tailoring Rule Regulatory Alternatives 50
5.2 Net Benefits of the Final GHG Tailoring Rule and Regulatory Alternatives 51
5.3 Net Benefits of the Final Rule and Step 3 Regulatory Alternatives 52
6.0 Number of Firms by Industry and Enterprise Size: 2002 55
6.1 Number of Establishments by Affected Industry and Enterprise Size: 2002 57
6.2 Number of Employees by Affected Industry and Enterprise Size: 2002 59
6.3 Receipts by Industry and Enterprise Size: 2002 (in millions of 2007$) 61
6.4 Number of Firms by Affected Industry and Enterprise Size in Commercial Sectors:
2002 63
6.5 Number of Establishments by Affected Industry and Enterprise Size: 2002 64
6.6 Number of Employees by Affected Industry and Commercial Enterprise Size:
2002 66
6.7 Receipts by Affected Industry and Enterprise Size: 2002 (Millions of 2007 $) 67
6.8 Avoided Title V Costs to Sales for Small Industrial Sources of GHG Emissions 72
6.9 Avoided Costs to Sales for Small Modifying Industrial GHG PSD Emission
Sources 74
6.10 Avoided Costs to Sales for Small New PSD Industrial GHG Sources 76
6-11 Avoided Title V Permitting Costs to Sales for Permit Revisions Due to GHG 78
6.12 Title V Avoided Costs for Small New Commercial Sources of GHG Emissions
Compared to Annual Sales Revenue 81
6.13 Avoided Costs for Small Modifying Commercial PSD GHG Emission Sources
Compared to Annual Sales Revenue 83
6.14 Avoided Costs to Small PSD New Commercial GHG Emission Sources 85
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A-l Title V Sources Expected to Experience Regulatory Relief at Alternative Threshold
Levels by Industry Category 100
A-2 New PSD Sources Expected to Experience Regulatory Relief at Alternative
Threshold Levels by Industry Category 102
List of Figures
Page
1.0. Alternative States of Regulation Relating to the GHG Tailoring Rule 11
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Section 1
Executive Summary
1.0 Summary
This Regulatory Impact Analysis (RIA) examines the benefits, costs, and economic
impacts of the Final Prevention of Significant Deterioration and Title V Greenhouse Gas
Tailoring Rule for affected entities and society as a whole. The tailoring rule lifts, for a period of
beginning January 2, 2011 through April 30, 2016 (referred to as phase-in period), the burden to
obtain a title V operating permit required by the Clean Air Act (CAA or Act) for many small
existing sources of greenhouse gas (GHG) and the burden of Prevention of Significant
Deterioration (PSD) requirements for small new or modifying sources of GHG. Thus, this rule
may be viewed as providing regulatory relief rather than regulatory requirements for these
smaller GHG sources for a period of at least the phase-in period. For larger sources of GHG,
there are no direct economic burdens or costs as a result of this rule, because requirements to
obtain a title V operating permit or to adhere to PSD requirements of the CAA are already
mandated by the Act and by existing rules and are not imposed as a result of this rulemaking.
In this final rule, the Environmental Protection Agency (EPA) is relieving overwhelming
permitting burdens that would, in the absence of this rule, fall on permitting authorities and
sources. We accomplish this by tailoring the applicability criteria that determine which GHG
emission sources become subject to the PSD and title V programs of the CAA. In particular,
EPA is establishing with this rulemaking a phase-in approach for PSD and title V applicability,
and is establishing the first two steps of the phase-in for the large emitters of GHGs. We also
commit to certain follow-up actions regarding future steps beyond the first two, discussed in
more detail later.
For the first step of this Tailoring Rule, which will begin on January 2, 2011, PSD or title
V requirements will apply to sources' GHG emissions only if the sources are subject to PSD or
title V anyway due to their non-GHG conventional pollutants. Therefore, EPA will not require
sources or modifications to evaluate whether they are subject to PSD or title V requirements
solely on account of their GHG emissions. Specifically, for PSD, Step 1 requires that as of
January 2, 2011, the applicable requirements of PSD, most notably, the best available control
technology (BACT) requirement, will apply to projects that increase net GHG emissions by at
least 75,000 tons per year (tpy) carbon dioxide equivalent (CC^e), but only if the project also
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significantly increases emissions of at least one non-GHG pollutant. For the title V program,
only existing sources with, or new sources obtaining, title V permits for non-GHG pollutants will
be required to address GHGs during this first step. This first step of the tailoring rule is referred
to as Step 1 or 'anyway' threshold throughout this RIA.
The second step of the tailoring rule, that begins on July 1, 2011, will phase-in additional
large sources of GHG emissions. New sources as well as existing sources not already subject to
title V that emit, or have the potential to emit, at least 100,000 tpy CC^e will become subject to
the PSD and title V requirements. In addition, sources that emit or have the potential to emit at
least 100,000 tpy CC^e and that undertake a modification that increases net emissions of GHGs
by at least 75,000 tpy CC^e will also be subject to PSD requirements. For both steps, we also
note that if sources or modifications exceed these CO2e-adjusted GHG triggers, they are not
covered by permitting requirements unless their GHG emissions also exceed the corresponding
mass-based triggers (i.e., unadjusted for CC^e.) This second step of the phase-in period is
referred to as Step 2 or 100,000 tpy CC^e threshold throughout this report. Although the
thresholds established by the tailoring rule are levels set that apply to sources at or above the
threshold, this RIA examine the sources obtaining regulatory relief. By definition the sources
obtaining regulatory relief are those sources with GHG potential to emit emissions below a
particular threshold
EPA believes that the costs to the sources and the administrative burdens to the
permitting authorities of PSD and title V permitting will be manageable at the levels in these
initial two steps, and that it would be administratively infeasible to subject additional sources to
PSD and title V requirements at those times. However, we also intend to issue a supplemental
notice of proposed rulemaking (SNPR) in 2011, in which we will propose or solicit comment on
a third step of the phase-in that would include more sources, beginning by July 1, 2013. In the
same rulemaking, we may propose or solicit comment on a permanent exclusion from permitting
for some category of sources. We are establishing an enforceable commitment that we will
complete this rulemaking by July 1, 2012, which will allow for 1 year's notice before step 3
would take effect. In addition, we commit to explore streamlining techniques that may well
make the permitting programs much more efficient to administer for GHGs, and that therefore
may allow their expansion to smaller sources. We expect that the initial streamlining techniques
will take several years to develop and implement.
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We are also including in this action a rule that no source with emissions below 50,000 tpy
CO26, and no modification resulting in net GHG increases of less than 50,000 tpy CC^e, will be
subject to PSD or title V permitting before at least, April 30, 2016. This is because we are able
to conclude at the present time that the administrative burdens that would accompany permitting
sources below this level will be so great that even the streamlining actions that EPA may be able
to develop and implement in the next several years, and even with the increases in permitting
resources that we can reasonably expect the permitting authorities to acquire, it will be
impossible to administer the permit programs for these sources until at least 2016.
Further, we are establishing an enforceable commitment that we will (i) complete a study
by April 30, 2015, to evaluate the status of PSD and title V permitting for GHG-emitting
sources, including progress in developing streamlining techniques; and (ii) complete further
rulemaking based on that study by April 30, 2016, to address the permitting of smaller sources.
That rulemaking may also consider additional permanent exclusions based on the "absurd
results" doctrine, where applicable.
This tailoring rulemaking is necessary because without it, PSD and title V would apply to
all stationary sources that emit or have the potential to emit more than 100 or 250 tpy of GHGs
beginning on January 2, 2011. This is the date when EPA's recently promulgated Light Duty
Vehicle Rule (LDVR)1 takes effect, imposing control requirements for the first time on carbon
dioxide (€62) and other GHGs. If this January 2, 2011 date were to pass without this tailoring
rule being in effect, PSD and title V requirements would apply at the 100/250 tpy CO2e potential
to emit (PTE) applicability levels provided under a literal reading of the CAA as of that date.
From that point forward, a source owner proposing to construct any new major source that emits
at or higher than the applicability levels (and which therefore may be referred to as a "major"
source) or modify any existing major source in a way that would increase GHG emissions would
need to obtain a permit under the PSD program that addresses these emissions before
construction or modification could begin. Similarly, title V would apply to a new or existing
source exceeding the 100 tpy applicability level in the Act, if the source did not already have a
title V permit.
1 EPA-HQ-OAR-2009-0472; NHTSA-2010-0059 RIN 2060-AP58; RIN 2127-AK50. April 1, 2010 Light-Duty
Vehicle Greenhouse Gas Emission Standards and Corporate Average Fuel Economy Standards; Final Rule
http://www.epa.gov/otaq/climate/regulations/ldv-ghg-final-rule.pdf
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Under these circumstances, many small sources would be burdened by the costs of the
individualized PSD control technology requirements and permit applications that the PSD
provisions, absent streamlining, require. Additionally, state and local permitting authorities
would be burdened by the extraordinary number of these permit applications, which are orders of
magnitude greater than the current inventory of permits and would vastly exceed the current
administrative resources of the permitting authorities. Permit gridlock would result with the
permitting authorities able to issue only a tiny fraction of the permits requested.
This rulemaking provides permitting thresholds for sources of GHG exceeding levels
contained in the CAA, and these levels are phased in steps based on legal considerations of
absurd results and administrative necessity discussed in the preamble to this rule. In the phase-in
period following promulgation of this rule, we estimate that, compared to baseline estimates that
do not include the effects of this rule, over six million sources of GHG emissions will be allowed
to operate without a title V operating permit and tens of thousands of new sources or modifying
sources per year will not be subject to PSD requirements for GHG. The emissions from these
sources amount to approximately 11 percent of all GHG emissions from stationary sources
(100,000 CO26 tpy threshold) equating to approximately 630 million short tons CC^e, but
represent 95 percent of the total number of stationary sources. For this large number of smaller
GHG sources, this rule alleviates the regulatory burden associated with obtaining an operating or
PSD permit or complying with PSD BACT requirements. Therefore, this final action may be
considered beneficial to these small sources as it provides relief from regulation that would
otherwise be required.
Within this RIA we are providing an illustrative monetary estimate of statutory
permitting requirements to show the magnitude of the savings that hypothetically result from this
rulemaking. While we believe it is impossible to implement these permit requirements by
January 2, 2011 for the reasons laid out in the preamble, it is useful to understand the scale of
what the burden may have been. For sake of simplicity, within this document we refer to this
illustrative monetary estimate as the monetized benefits of the regulatory relief presented by this
rulemaking or regulatory relief benefits for brevity. We estimate that the regulatory relief
benefits from this rule amount to $193.6 billion for the final rule Steps 1 and 2 of the phase-in
period (January 2, 2011 through July 1, 2013). There will be some costs to society during this
time from the potential loss of GHG emission reductions from small sources that could occur
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during the Steps 1 and 2 phase-in period. We are not able to quantify or monetize these potential
foregone emission reductions resulting from this final rule.
1.1 Summary of Analytical Approach for the Analysis
Our analysis of the GHG tailoring rule includes several key elements including:
• specification of the baseline that requires title V and PSD permitting statutory
thresholds of 100/250 tpy CO2e potential to emit (PTE),
• development of alternative regulatory relief thresholds including those authorized
by this final rule,
• estimation of sources affected by alternative regulatory relief thresholds,
• estimation of the benefits of this rule in terms of permitting burden costs avoided,
• qualitative discussion of social costs or potential GHG emission reductions
foregone due to this rule, and
• estimation of the economic impacts of this final rule.
A brief synopsis of these analytical aspects of the final rule follows.
Analytical Baseline
The baseline for this rulemaking is a state of regulation in which the statutory thresholds
of 100/250 tpy CO26 apply for title V sources and new or modifying PSD sources beginning
January 2, 2011 absent actions taken in the final tailoring rule. Figure 1.0 below depicts this
analytical baseline in which GHG permitting is statutorily required by the CAA. Within this
framework, there are two general possibilities - 'no action' or 'regulatory relief action' taken by
EPA. Under the 'no action' case baseline, statutory limits become effective and permitting
authorities are overwhelmed with permit applications. Millions of new sources in total many of
which have not been regulated under the Act would be required to obtain title V sources and tens
of thousands of these sources will face PSD permitting annually. In contrast, the EPA may take
action as it has in this final rule to provide 'regulatory relief. As described, the 'no action' case
is the analytical baseline for this RIA. All alternatives analyzed in this RIA show the level of
regulatory relief in comparison to a baseline in which statutory CAA thresholds of 100/250 tpy
CO26 are required.
Regulatory Alternatives, Affected Sources, and Avoided Permitting Cost Estimates
All regulatory alternatives evaluated in this RIA, except the 'no action' alternative,
represent regulatory relief possibilities that establish title V permitting thresholds and PSD
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permitting thresholds and significance levels above the statutory 100/250 tpy CC^e requirements.
Due to the phase-in nature of this rule, EPA analyzes the benefits and costs of the tailoring rule
for three different time periods. We analyze the net benefits of the rule annually to allow for a
comparison of the final rule Steps 1 and 2 to be made with regulatory alternatives. We also
evaluate the net benefits of the rule for the 2V2 years period of Steps 1 and 2 of the phase-in
period (January 2, 2011 through July 1, 2013) , and for the approximate five year period of Step
1, 2, and 3 of the phase-in period January 2, 2011 through April 30, 2016. Table 1.0 shows the
final rule and regulatory alternatives analyzed in this RIA for these differing time periods of the
phase-in.
The benefits of this rule are the regulatory relief in the form of avoided permitting
burdened cost for smaller sources of GHG and permitting authorities. Avoided permitting costs
to these smaller GHG sources and permitting authorities are calculated by estimating the number
of sources and related permits avoided as a result of this rule. We then place a dollar value on
these avoided permits by estimating the burden cost per permit. The product of the avoided
permits and the per permit costs represents the regulatory relief for this rule. Thus the annual
regulatory relief for the rule is equal to the number of annual sources (number of permits) above
statutory thresholds of 100/250 tpy and below final rule thresholds multiplied by per permit costs
for sources and permitting authorities, respectively. We use these annual estimates to calculate
multiple year regulatory relief for Steps 1 and 2 of the phase-in and for the five years beginning
January 2, 2011. Estimates of sources afforded regulatory relief under the alternative regulatory
thresholds are based upon an analysis completed by EPA that is included as Attachment B
Technical Support Document for Greenhouse Gas Emissions Threshold Evaluation of this report.
This analysis supports EPA's assessment of the administrative burden created by adding GHGs
to the PSD and title V programs. It was necessary to develop information on the number of
affected facilities at both the current permitting major source thresholds (100 tons per year for
title V and 100 or 250 tons per year for PSD depending on the source category classification) and
at alternative higher thresholds in existing PSD and title V permitting programs. An affected
facility would be one who's annual emissions of GHG equal or exceed the major source
threshold being evaluated. The number of sources allowed regulatory relief by this rule
represents the difference in the number of sources at the baseline 100/250 tpy CC^e PTE
threshold and at the higher regulatory alternative thresholds.
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Figure 1.0. Alternative States of Regulation Relating to the GHG Tailoring Rule
GHG
Permitting
Triggered
No Action
Case
Baseline
* Statutory
limits become
effective
^Permitting
authorities
overwhelmed
with permit
applications,
millions of
new sources
required to
obtain permits
Action Taken
With Permit
Trigger
*RIA analyzed
regulatory
alternatives
* Significant
reduction in
facilities required
to obtain permit
and permitting
authority burdens
*Limited foregone
GHG emission
reductions
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Table 1.0 Time Periods and Regulatory Alternatives Analyzed in the RIA
Time Period of Analysis
Regulatory Alternatives Thresholds
Analyzed for Each Time Period1
Annual
1. Anyway
2. 100,000 tpy CO2e
3. 50,000 tpy CO2e
4. 25,000 tpy CO2e
2.5-Year
(Jan. 2, 2011-July 1,2013)
Corresponds to Steps 1 and
2 of the Phase-In
Alternatives assuming threshold remain in effect for the entire
years of the Step 1 and 2 phase-in period):
1. 25,000 tpy CO2e (25,000 tpy CO2e significance level)
2. 50,000 tpy CO2e (50,000 tpy CO2e significance level)
3. 100,000 tpy CO2e
4. Anyway
Other alternatives involving thresholds that change during the
phase-in period are:
5. Step 1 Anyway for 6 months/ Step 2 100,000 tpy CO2e for 2
years
6. Step 1 Anyway threshold for 6 months / Step 2 50,000 tpy CO2e
for 2 years
7. Stepl Anyway threshold for 6 months/ Step 2 25,000 tpy CO2e
for 2 years
5-year
(Five years beginning
January 2, 2011)
Corresponds to Steps 1-3
of the Phase-In
1. Step 1 Anyway for 6 months/ Step2 100,000 tpy CO2e for 2
years/ Step 3 100,000 tpy CO2e for 21/2 years
2. Step 1 Anyway for 6 months/ Step 2 100,000 tpy CO2e for 2
years/ Step 3 50,000 tpy CO2e for 21/2 years
1 Regulatory relief relates to those sources with the potential to emit annual emissions below the threshold levels.
Threshold 100,000 tpy CO2e has significance level of 75,000 tpy CO2e. Threshold 50,000 tpy CO2e has significance
level of 50,000 tpy CO2e, and threshold 25,000 tpy CO2e has significance level of 25,000 tpy CO2e
Regulatory relief or avoided permit burden estimates are based upon permitting cost
estimates developed by EPA and discussed extensively in Attachment C Summary of
Methodology and Data Used to Estimate Burden Relief and Evaluate Resource Requirements at
Alternative Greenhouse Gas Permitting Thresholds.. EPA conducted an assessment of the
estimated resource requirements for sources to obtain title V operating permits, for new and
modifying sources to obtain PSD permits, and for permitting authorities to include GHG in
permit actions at several possible major source permitting thresholds. EPA developed the burden
reduction and costs savings for permitting authorities and sources as a result of requiring the
inclusion of GHG in the title V and PSD permitting programs at thresholds greater than the
current statutory requirements. Time and costs associated with permit activities are derived from
existing Information Collection Requests (ICRs) for the title V and PSD programs. Regulatory
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relief avoided cost estimates do not include the costs for new and modifying PSD sources to
comply with BACT requirements due to lack of sufficient data to estimate the BACT
requirements and associated costs.
We discuss the costs of this rule in terms of foregone environmental benefits qualitatively
in this report. There will be some costs to society during this phase-in period from the potential
loss of GHG emission reductions from small sources that could occur during the Steps 1, 2, and
3. We are not able to quantify or monetize these potential foregone emission reductions resulting
from this final rule. We also provide in this RIA an estimate of the economic impact of the
regulatory relief to affected sources by developing avoided-cost-to-sales ratios for the affected
sources by comparing avoided permitting costs to average industry sales revenue or average
revenue by firm size.
Limitations and Uncertainties of the Analysis
The benefits, costs and economic impacts estimated in this RIA are subject to limitations
and uncertainties. The benefits of this rule are the regulatory relief provided to small sources of
GHG and permitting authorities. Regulatory relief estimates are provided for the final rule Steps
1, 2 and 3 on an annual basis as well as for the full phase-in period. The benefits or avoided
permitting costs are based upon the best data available currently regarding sources affected and
burden cost estimates but are subject to uncertainties.
Benefit Estimate Limitations and Uncertainties
Uncertainties exist in the affected source counts at different thresholds used to estimate
regulatory relief due to the absence of a comprehensive data set of facility-level GHG emissions
across all sectors on which to base the number of facilities subject to title V and PSD permitting
at alternative regulatory thresholds. These affected source counts are multiplied by the permit
burden cost estimates to derive the benefit (regulatory relief) estimates for the rule. Although
there are different levels of uncertainty in our facility level estimates across sectors, we do
believe that the data are sufficiently robust to use in the aggregate to assess national permitting
level impacts. The threshold analysis also conservatively assumes that no GHG PTE limits are
in place for any of the affected sources. Some sources may use PTE limits to avoid being
classified as major, which would reduce burden. The number of PTE limits is uncertain. We
assume there will be a limited number in the immediate stages of GHG permitting for affected
sources, but this assumption is subject to some uncertainty.
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There is also significant uncertainty in both our modification rate for newly major GHG
sources and in our estimate of modification activity at existing major sources that will become
subject to PSD review for GHG emission increases. The general uncertainty results from
inherent uncertainty in predicting not only how many major sources will elect to undergo
physical or operational changes in any given year, but also which of those changes would result
in GHG emissions increases that would exceed a proposed GHG significance level. First,
information is not available across sectors and source categories on the types and numbers of
specific physical and operational changes that would result in GHG emissions increases in
amounts that can be estimated and that therefore can be compared to various GHG emissions
significance levels. Second, there is uncertainty in how many project modifications will occur
within any given year because decisions on these projects are driven by facility- and sector-based
growth patterns and business planning decisions. Lastly, some source categories and units that
emit GHGs have not previously been subject to any type of permitting or reporting requirements;
as a result, for these sources, there is very little historical record for use in estimating the number
and types of projects that would occur at these sources and, in turn, establish an appropriate
significance level for GHGs.
The permit burden estimates that are multiplied by the source counts to derive the
benefits of the rule are also subject to uncertainty. The primary reference sources for our
estimate of burden hours and costs for permitting GHGs are the most recent ICRs for the PSD
and title V programs. There a number of uncertainties introduced in using these references for
costing GHG permitting activities. First, we are assuming that the average, conventional
pollutant per-permit costs will be similar for GHGs. We do recognize the likelihood that
residential and commercial permits would be simpler and have a lower per-permit burden than
traditional industrial sources, and have made adjustments for this: however, for industrial sources
we assume per-permit costs on par with what are estimated in the latest ICRs for PSD and title V
programs. There is uncertainty in applying these average ICR-based costs to GHG permitting,
even for industrial sources, because the best source of this cost information is permitting
experience and there is no historical track record for permitting these GHG sources and thus any
cost efficiencies that have been realized over the years for conventional pollutant permitting, and
thus reflected in the current ICRs, may not be initially realized for GHG permitting.
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As mentioned above, in our burden scenario analyses we do discount the ICR-based per-
permit costs for residential and commercial sources to reflect what we believe will generally be
simpler permits, involving primarily uniform combustion type equipment. For PSD we discount
the per-permit cost by 30%, and for title V we discount the per-permit cost by 50%. There is
significant uncertainty in these estimated discounts since we have no track record for permitting
these smaller commercial and residential sources. However, we do believe that, based solely on
the type and uniformity of the GHG emission units that would be subject to permitting at these
facilities under lower GHG threshold scenarios, that average per-permit costs would be less than
those currently experienced by more complex industrial facilities, with numerous emission units,
for currently regulated pollutants.
Current avoided permitting cost or regulatory relief estimates also do not include the
avoided costs to comply with PSD BACT requirements due to lack of available data. This
omission will tend to reduce the amount of regulatory relief that smaller sources of GHG will
experience during the phase-in period. In addition to the avoided BACT costs that we are unable
to quantify, there are likely general economic costs associated with requiring permitting for these
smaller sources of GHG. Numerous public comments on the proposed rule spoke to the
economic burden permitting would place on sources above the actual costs to obtain a permit.
These costs might include delays or impediments to entering a new market or to expand existing
facilities to accommodate increased demand for products or services. These avoided costs might
be viewed as additional costs of doing business or barriers to entry for these smaller sources of
GHG. The avoided economic costs of these possible additional costs or barriers to doing
business have not been considered in the regulatory relief estimates provided for this final rule
due to lack of sufficient information about these potential impacts. If such avoided cost
estimates were available, these estimates would tend to increase the regulatory relief burden
reported for the final rule.
For the phase-in period regulatory relief multiyear estimates, we assume that the annual
estimates are representative for each year of the phase-in period. This presumes that permitting
activity would be constant over time. It is quite possible that permit activity for these smaller
sources may grow over time with economic growth in the general economy and will likely vary
from year to year due to differences in business activity. However, we do not have sufficient
information about these year to year variations nor expected growth in permitting to develop
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more precise estimates. Given the uncertainty in the annual relief estimates and the short time
frame analyzed (five years), we feel it reasonable to not consider these potential yearly
fluctuations for the phase-in period. Consideration of growth in permits over time would tend to
increase the regulatory relief estimates reported for the final rule.
In a similar manner, we do not discount the phase-in regulatory relief to the present in
this final report. Since the analytical time period evaluated varies from annual to five years, we
feel this is a reasonable approach. Discounting the regulatory relief estimates to present values
would tend to lower the total present value amount of regulatory relief reported.
Social Cost Limitations and Uncertainties
The social costs of this rule are the foregone environmental benefits that might occur
during the phase-in period absent this rulemaking. This subject is discussed in Section 4 of the
RIA. We are unable to estimate the PSD BACT requirements that would likely occur for the
smaller sources of GHG at this time. Because BACT is a case-by-case decision and evolves over
time, because we do not at this time have historical experience with the available controls for
small-source GHG emissions, and because of the inherent uncertainty in describing the types of
sources that would have triggered BACT absent this rule, we cannot quantify the emission
reductions that might be feasible or the associated pollution control costs. For this reason, the
social costs of this rule are discussed qualitatively in this RIA.
Economic Impact Limitations and Uncertainties
As previously discussed there is uncertainty in the estimates of sources affected by this
final rule and the permitting burden costs used to estimate the benefits (regulatory relief) of this
rule. These uncertainties also affect the economic impact analysis conducted. In the economic
impact analysis, we compare the avoided permit burden cost estimates to average industry
revenues in order to gauge the magnitude of regulatory relief for affected sources. We used
average industry revenue, and average revenue estimates by firm size to estimate avoided-cost-
to-sales ratios due to lack of data specific to the sources actually obtaining regulatory relief. The
actual benefits to individual firms affected by this rule may differ from industry averages.
1.2 Benefits, Cost, and Net Benefits of the Final Tailoring Rule
In the RIA, we estimated the benefits, costs and net benefits of the final rule. This
rulemaking provides regulatory relief for a phase-in period of approximately 5 years to smaller
sources of GHG by phasing in the statutory permitting threshold at levels above statutory
16
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requirements. This final rule establishes thresholds and PSD significance levels for Steps 1 and
2 of the phase-in period (the 21/2 year period between January 2, 2011 and July 1, 2013), commits
to considering a further Step 3, and indicates floor title V and PSD threshold levels from July 1,
2013 through April 30, 2016. While the EPA commits to undertake a rulemaking for a further
Step 3, the ultimate outcome for sources of GHG from this additional rulemaking is unknown at
this time. Annual estimates for the final rule Steps 1 and 2 and regulatory alternatives are
presented in Table 1.1. As Table 1.1 indicates, the annual net benefits associated with the final
rule Step 1 are $77,530.2 million +B-C and for Step 2 are $77,416.2 +B-C million, where B
denotes the unquantified benefits and C the quantified costs of this final rule. These unquantified
benefits and costs are discussed in more detail in the preceding limitations and uncertainties
section of this executive summary. Table 1.2 shows the final rule Steps 1 and 2 with regulatory
alternatives for the two and one-half year phase-in period January 2, 2011 through July 1, 2013.
The net benefits of the final rule for Steps 1 and 2 are $193,597.5 + B - C million for the two and
one-half year period. Finally, Table 1.3 presents the final rule net benefits with two alternatives
for Step 3, one in which Step 3 remains at the Step 2 100,000 tpy CO2e level and one in which
Step 3 becomes the minimum threshold of at least 50,000 tpy CO2e previously discussed. These
alternatives for Step 3 bound the net benefit estimates for the entire phase in period. If Step 3
remains at the Step 2 level, net benefits for the five year period are $387,153.4+5-0 million.
This net benefit estimate becomes $386,724.1 +B-C million if Step 3 becomes the minimum
level of 50,000 tpy threshold for the five year phase-in period. Given the short time frame of the
impact of this final rule, we did not consider the time value of money or discount the benefit and
cost estimates provided in this report to present values, rather we assume these benefit and cost
estimates are occurring currently. All dollar estimates shown are based upon 2007$.
17
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Table 1.1 Annual Net Benefits for GHG Tailoring Rule Regulatory Alternatives
Benefits - Regulatory Relief
Sources
Title V1
PSD2
Total Source Regulatory Relief
Permitting Authority
Title V1
PSD2
Total Permitting Authority
Total Regulatory Relief
Costs - Foregone GHG Emission Reductions
Title V& PSD
Net Benefits3
Annual Benefits and Costs for Regulatory Alternatives (millions of 2007$)
Final Rule Step 1
Anyway
$49,457.3
$5,488.8
$54,946.1
$21,077.6
$1,506.5
$22,584.1
$77,530.2+B
C
$77,530.2+B-C
Final Rule Step 2
100,000 tpy CO2e
$49,447.4
$5,411.2
$54,858.6
$21,072.4
$1,485.2
$22,557.6
$77,416.2+B
C
$77,416.2+B-C
50,000 tpy CO2e
$49,403.8
$5,326.0
$54,729.8
$21,052.8
$1,461.8
$22,514.6
$77,244.4+B
C
$77,244.4+B-C
25,000 tpy CO2e
$49,334.2
$4,707.6
$54,041.8
$21,014.9
$1,291.7
$22,306.6
$76,348.4+B
C
$76,348.4+B-C
Benefits relate to regulatory relief for sources with annual potential to emit levels below the thresholds shown.
B - unqualified benefits of the rule include regulatory relief from B ACT requirements for PSD sources
C - unqualified social costs of tailoring rule represents economic value of foregone environmental benefits (possible GHG emission
reductions) during Step 1 and 2 of the phase in period. Potential foregone GHG emission reductions during the phase-in period are not
known at this time. See Section 4 of the RIA for a qualitative discussion of the social costs of the rule.
IReflects estimates of regulatory relief or avoided permit burden costs for title V GHG sources and permitting authorities.
2 Shows estimates of regulatory relief or avoided permit burden costs for GHG PSD sources and permitting authorities.
3 Totals may not sum due to rounding.
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Table 1.2. Net Benefits for the Final Rule and Regulatory Alternatives for Steps 1 and 2 of the Phase-In Period
Benefits - Regulatory Relief
Sources
Title V1
PSD2
Total Source Regulatory Relief
Permitting Authority
Title V1
PSD2
Total Permitting Authority
Total Regulatory Relief
Costs - Foregone GHG Emission
Reductions
Title V& PSD
Net Benefits
Benefits and Cost s for Step 1 and 2 Phase-In Period (January 2, 2011- July 1, 2013)
For Regulatory Alternatives (millions of 2007$)
Anyway3
$123,643.3
$13,722.0
$137,365.3
$52,694.1
$3,766.3
$56,460.4
$193,825.6+5
C
$193,825.6+B-C
100,000 tpy
CO2e3
$123,618.5
$13,528.0
$137,146.5
$52,681
$3,713.0
$56,393.9
$193,540.4+5
C
$193,540.4+B-C
50,000 tpy CO2e3
$123,509.5
$13,315.0
$136,824.5
$52,631.9
$3,654.5
$56,286.3
$193,110.9+5
C
$193,110.9+B-C
25,000 tpy
CO2e3
$123,335.5
$11,769.0
$135,104.5
$52,537.3
$3,229.3
$55,766.7
$190,871.1+5
C
$190,871.1+B-C
Anyway/ 50,000
tpy CO2e4
$123,536.3
$13,396.4
$136,932.8
$52,644.3
$3,676.8
$56,321.1
$193,253.9+5
C
$193,253.9+B-C
Anyway/25,000
tpy CO2e5
$123,397.1
$12,159.6
$135,556.6
$52,568.7
$3,336.7
$55,905.4
$191,462.0+5
C
$191,462.0+B-C
Final Rule6
$123,623.5
$13,566.8
$137,190.3
$52,683.6
$3,723.6
$56,407.2
$193,597.5+5
C
$193,597.5+B-C
Benefits represent regulatory relief for those sources with the annual potential to emit less than the threshold shown.
B - unqualified benefits of the rule include regulatory relief from B ACT requirements for PSD sources
C - unqualified social costs of tailoring rule represents economic value of foregone environmental benefits
(potential GHG emission reductions) during Step 1 and 2 of the phase in period. Foregone GHG emission reductions are not known at this time.
See Section 4 of the PJA for a qualitative discussion of the social costs of the rule.
IReflects estimates of regulatory relief or avoided permit burden costs for title V GHG sources and permitting authorities.
2 Shows estimates of regulatory relief or avoided permit burden costs for GHG PSD sources and permitting authorities.
3 Shows alternative as single step for the 2'Ayear phase-in period for 'anyway', 100,000 tpy CO2e, 50,000 tpy CO2e, and 25,000 tpy CO2 e thresholds respectively.
4 Includes Step 1 for one-half year and 50,000 tpy CO2e threshold for two years.
5 Includes Step 1 for one-half year and 25,000 tpy CO2e threshold for two years.
6 Phase-in period for final rule includes 1/2 year of Step 1 thresholds and 2 years of Step 2 threshold.
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Table 1.3 Net Benefits of the Final Rule and Step 3 Regulatory Alternatives
Benefits - Regulatory Relief
Sources
Title V1
PSD2
Total Source Regulatory Relief
Permitting Authority
Title V1
PSD2
Total Permitting Authority
Total Regulatory Relief
Costs - Foregone GHG Emission Reductions
Title V & PSD
Net Benefits
Regulatory Alternative (millions 2007$)
Final Rule + Possible Step 3 of
100, 000 tpy CO2e3
$247,253.6
$27,094.7
$274,348.3
$105,368.5
$7,436.61
$112,805.1
$387,153.4+5
C
$387,153.4+B-C
50, 000 tpy CO2e4
$247,145.3
$26,881.8
$274,027.1
$105,318.8
$7,378.1
$112,696.8
$386,719.4+5
C
$386,724.1+B-C
Benefits represent regulatory relief for sources with the annual potential to emit below the thresholds
shown.
B - unqualified benefits of the rule include regulatory relief from B ACT requirements for PSD sources
C - unqualified social costs of tailoring rule represents economic value of foregone environmental
benefits (potential GHG emission reductions) during Step 1, 2,and 3 of the phase in period.
Foregone GHG emission reductions are not known at this time. See Section 4 of the RIA for a
qualitative discussion of the social costs of the rule.
IReflects estimates of regulatory relief or avoided permit burden costs for title V GHG sources and
permitting authorities.
2 Shows estimates of regulatory relief or avoided permit burden costs for GHG PSD sources and
permitting authorities.
3 Includes 1/2 year of Step 1 (anyway threshold), 41/2 years of Step 2 (100,000 threshold),
4 Includes 1/2 year of Step 1 (anyway threshold), 2 years of Step 2 (100,000 threshold),
and 21/2 years Step 3 alternative of 50,000.
1.3 Organization of this Report
The remainder of this report supports and details the methodology and the results of this
illustrative RIA.
• Section 2 presents a discussion of the regulatory baseline, regulatory alternatives and
affected entities.
• Section 3 describes the benefits of the rule.
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Section 4 provides a qualitative description of social costs of the rule.
Section 5 presents the benefits, costs, and net benefits of the rule.
Section 6 describes the methodology and the estimated economic impacts of the
regulatory relief.
Section 7 discusses small business impacts, unfunded mandates, and effects of the
rule on energy supply
Section 8 describes limitations and uncertainties of the analysis
Section 9 lists the references for the analyses included in this RIA.
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Section 2
Baseline Description, Regulatory Alternatives, and Affected Entities
As previously stated, this final rule is essentially providing regulatory relief and does not
include direct regulatory provisions for any industrial, commercial, or residential entities. An
analysis is presented for smaller sources that experience regulatory relief. This rule increases the
GHG applicability threshold for title V from 100 tpy CC^e and for new and modifying sources of
GHG emissions from the CAA mandated 100 or 250 tpy CC^e major source applicability
threshold in a phased-in step process described in Table 2.0.
Table 2.0. Phase-In Steps for Large Sources for the Final GHG Tailoring Rule1
PSD
Title V
Step 1: Phase-in of Large Sources
(January 2,2011- June 30, 2011)
(referred to as 'anyway' threshold
or Step 1)
Permitting based on emissions
of non-GHG pollutants and,
for BACT applicability with
GHG emissions or GHG
emission increases above
75,000 tpy CO2e
Sources with title V permits for non-
GHG pollutants will address GHG
as part of title V permitting
Step 2: Phase in for Large Sources
(July 1,2011-June 30, 2013)
(referred to as 100,000 tpy CO2e threshold
or Step 2)
Sources above 100,000 tpy
(new) and 75,000 tpy (major
modifications) of CO2e (and
not already subject to PSD
based on non-GHG)
Sources that exceed 100,000 tpy
GHG threshold will be required to
obtain a title V permit if they do not
already have one
Step 3: Phase in for Large Sources
(July 1, 2013 - April 30, 2016)
Effective only after additional regulatory
process
An enforceable commitment
to assess experience from
Steps 1 and 2; commit to
propose, consider comments,
and promulgate potential Step
3 (level will not go below
50,000 tpy CO2e [new] and
50,000 tpy CO2e [major
modifications])
An enforceable commitment to
assess experience from Steps 1 and
2; commit to propose, consider
comments, and promulgate potential
Step 3 (level will not go below
50,000 tpy CO2e)
Final Phase
Effective only after additional regulatory
process
EPA will take rulemaking
action in 2016 or before to
address small sources in light
of the 5-year study
EPA will take rulemaking action in
2016 or before to address small
sources in light of the 5-year study
Thresholds/significance levels are based on PTE.
The rules also sets GHG significance levels for each step under PSD to determine applicability
as it relates to GHG emissions or emission increases for projects at major sources.
The baseline for this rulemaking is a state of regulation in which the statutory thresholds
of 100/250 tpy CO26 apply for title V sources and new or modifying PSD sources beginning
January 2, 2011 absent actions taken in the final tailoring rule. Within this framework, there are
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two general possibilities - 'no action' or 'regulatory relief action' taken by EPA. Under the 'no
action' case baseline, statutory limits become effective and permitting authorities are
overwhelmed with permit applications. Millions of new sources in total many of which have not
been regulated under the Act are required to obtain title V sources and tens of thousands of these
sources will face PSD permitting annually. In contrast, the EPA may take action as it has in this
final rule to provide 'regulatory relief. As described, the 'no action' case is the analytical
baseline for this RIA. All alternatives analyzed in this RIA show the level of regulatory relief in
comparison to a baseline in which statutory CAA thresholds of 100/250 tpy CC^e are required.
For larger sources of GHG, there are no direct economic burdens or costs as a result of this rule,
because requirements to obtain a title V operating permit or to adhere to PSD requirements of the
CAA are already mandated by the Act and by existing rules and are not imposed as a result of
this rulemaking.
In order to analyze the baseline administrative burden created by adding GHGs to
existing PSD and title V permitting programs, it was necessary to develop information on the
number of affected facilities at the current permitting major source thresholds (generally, 100
tons per year for Title V and 100 or 250 tons per year for PSD depending on the source category
classification). An affected facility would be one who's annual emissions of the GHG equal or
exceed the major source threshold, based on a PTE basis. Detailed descriptions of the
methodologies used are provided in Attachments B and C of the RIA. An explanation of the
uncertainties associated with this methodology is discussed in Section 8 of this report. The
following are the basic steps used in the methodology to estimate affected sources and permitting
actions under the baseline scenario.
1) Identify GHG source categories. EPA evaluated the same range of stationary source
types with direct GHG emissions as identified in EPA's proposed and final GHG mandatory
reporting rule (MRR)2. The GHG MRR source categories were based on a comprehensive
review of all U.S. source categories with GHG emissions from EPA's national inventory of GHG
74 FR 68, pp. 16447 - 16731 and 74 FR 209, pp. 56260-56519, respectively.
23
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emissions3. The stationary sources evaluated in this analysis can be grouped in the sectors shown
below:
• Electricity Generation (facilities with fossil fuel-fired electric generating units);
• Industry (range of industries with process and combustion GHG emissions);
• Energy (oil and gas extraction, transport, and processing; underground coal mining);
• Waste Treatment (landfills and municipal solid waste incinerators);
• Agriculture (stationary fuel combustion units);
• Commercial (variety of establishments including office, retail, hospitals, lodging, etc.);
• Residential (single-family and multi-family housing).
A small number of direct emission source types included in the GHG MRR analysis were
not included in the tailoring rule analysis because the GHG emissions from these sources were
primarily fugitive emissions. Fugitive emissions are generally defined as emissions which are
not released, or could not be reasonably collected and released, through a stack or vent. Under
the PSD rules, fugitive emissions are only included in potential to emit estimates if the source is
one of 28 listed PSD source categories. The excluded categories included electrical equipment
fugitive SFe emissions; wastewater treatment plant fugitive emissions not associated with one of
28 listed PSD source categories; and, agricultural manure management fugitive emissions.
2) Estimate Actual Facility Level GHG Emissions. We started with estimates of facility
emissions based on actual operating conditions, not PTE, since this is the standard format of the
EPA's national inventory of GHG emissions. Actual emissions for each source category were
obtained from earlier analyses performed to develop emission thresholds for the proposed and
final GHG MRR, or we used the same data sources when additional analyses were required.
EPA generally relied on published research and publicly available government data, such as
EPA's eGRID database of electric generating source emissions, Economic and Housing Census
data, and Energy Information Agency (EIA) data on energy consumption. See Attachment B for
full descriptions of the methodologies used to estimate emissions for each source category.
3 U.S. Environmental Protection Agency (EPA), Inventory of U.S. Greenhouse Gas Emissions
and Sinks: 1990 - 2007, April 2009, US EPA 430-R-09-004.
http://www.epa.gov/climatechange/emissions/usinventoryreport.html
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3) Estimate PTE-basedFacility Level GHG Emissions. It was necessary to convert
actual emissions to a PTE basis, because as noted earlier, that is the basis for determining
applicability under PSD and title V. PTE is generally defined as the amount of emissions that
can be emitted from a source operating at full equipment capacity, 24 hours per day, 365 days
per year. Capacity information and annual GHG emissions were available for some of the source
categories from analyses performed to support the GHG MRR. In some cases the supporting
analyses had already calculated GHG emissions on a full capacity basis, in which case EPA
directly used those estimates as PTE estimates. Alternatively, some data from the supporting
analysis estimated actual annual emissions using a baseline year. If capacity and baseline year
production information was provided in the supporting data, EPA adjusted the source actual
emissions estimate by the ratio of annual capacity to baseline production to estimate PTE. If
capacity information was not available, EPA used capacity factors from other data sources to
adjust actual emission estimates to PTE estimates. These capacity factors add varying
uncertainty to the PTE estimate. Detailed descriptions of the different PTE calculation
methodologies are included in the source descriptions in Attachment B.
4) Count Facilities that Exceed the Baseline GHG Thresholds. After compiling facility
level PTE-based emission under Step 3, these estimates were evaluated against the threshold
levels in order to determine whether or not a facility would be included in the baseline threshold
count. The number of facilities exceeding the baseline threshold based on a PTE basis were then
identified as 'major sources' for the purposes of GHG permitting under PSD and title V.
Our facility counts include both existing sources that would exceed the baseline GHG
thresholds and newly constructed sources. Newly constructed sources only represent a small
fraction (less than 2 percent for the baseline scenario) of the total population of GHG major
sources in a given year. Growth rates used to estimate new construction were based on a variety
of sources including Economic Census data, EIA energy survey data, and various EPA
regulatory impact analyses and information collection requests which require source population
estimates. In some cases there was sufficient information to distribute new sources to different
thresholds based on emission information specific to the new sources (electric generating,
municipal solid waste combustors, and commercial stationary fuel combustion).
5) Estimate total permitting actions for PSD and title V based on facility counts. The
next basic step was to estimate permitting actions that result from the baseline facility counts.
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For PSD, this required an estimate of modifications at existing facilities in addition to the
estimate of newly constructed facilities from step 4. Our estimate for modifications at existing
facilities is based on calculating how many of the facilities identified as major sources would
undergo a modification project that would exceed our baseline GHG thresholds. The
methodology for estimating modifications is described in detail in Attachment C. The basic
methodology for estimating modifications at existing, but newly classified GHG major sources,
under PSD was to apply a 4 percent modification rate to the population of facilities that exceed
the threshold. For title V, any facility, existing or newly constructed, that exceeded the baseline
thresholds for GHG permitting (i.e., 100 tpy CO2e) was considered to be required to get a title V
permit under the baseline scenario.
6) Calculate costs for permitting actions. The total permitting actions calculated under
step 5 above, were then combined with average permitting costs for each type of permitting
activity for PSD and title V to calculate overall permitting burden. See Attachment C for full
description on assumptions regarding permitting costs and how these were applied to different
permitting actions under PSD and title V.
7) Adjustments based on public comment on proposal. We made three main adjustments
to our basic methodology based on public comments received on our proposal. Two of these
affected the estimate of modifications under PSD. Many commenters indicated that they felt
EPA had underestimated the number of modification permitting actions associated with PSD.
Our proposed general modification rate (2 percent of the newly major facility population) used to
estimate modifications at existing, but newly newly major GHG sources did not appear to have
caught the extent to which facility level changes could result in projects that exceed the GHG
permitting threshold. In reassessing this modification rate, we determined that we had not fully
accounted for all possible PSD modifications relative to the major source population in
calculating this modification rate. Based on this reassessment we revised our general
modification rate to 4 percent (as noted above in step 5) that is used to estimate the annual
modification activity at existing, but newly major GHG sources.
Another adjustment to the PSD modifications methodology was based on public
comments on the proposal that we did not fully account for the number of major modification
projects at existing major sources because we did not capture the number of existing projects that
avoid major PSD review (by either taking limits—synthetic based modifications—or by netting
26
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out) for existing pollutants but that would not be able to avoid PSD for GHGs. Our
modifications methodology, as described in Attachment C, now specifically includes additional
modifications for these projects that would not be able to avoid PSD review because of their
GHG emissions.
Lastly, based on public on public comments we revised our estimate of capacity
utilization used for estimating PTE-based emissions for the general manufacturing source
category (referred to as 'unspecified stationary combustion' in the GHG threshold analysis in
Attachment B) and the oil and gas industry. In our proposal, the range for capacity utilization for
'unspecified stationary combustion' varied from 70 to 90 percent depending on manufacturing
category, and for the oil and gas industry we used 90 percent. Based on comments received
indicating that these utilization rates are higher than what is normally achieved in real-world
conditions, particularly for smaller manufacturing type facilities, we used a 50 percent capacity
utilization rate for both of these source categories. We believe that these assumptions better
reflect what can be deemed reasonable operation under normal conditions for facilities in these
source categories.
The baseline affected sources estimated using the preceding methodology are shown on
Table 2.1. As Table 2.1 shows, EPA estimates the total number of title V sources and the
annual estimate of new PSD sources that would be required to obtain permits absent this
tailoring rule in a world where EPA takes 'no action'. These affected source estimates provide a
baseline on which to estimate the regulatory relief allowed by EPA in this final rule and possible
at alternative regulatory thresholds. We compare these baseline affected source counts to the
sources counts at alternative regulatory relief thresholds to determine the number of sources
likely to obtain regulatory relief due to the tailoring rule.
All regulatory alternatives evaluated in this RIA, except the 'no action' alternative,
represent regulatory relief possibilities that establish title V permitting thresholds and PSD
permitting thresholds and significance levels above the statutory 100/250 tpy CC^e requirements.
In this RIA, EPA analyzes the benefits and costs of the tailoring rule for thresholds finalized in
this rule for Steps 1 and 2 of the phase-in period, as well as, the proposal thresholds of 25,000
tpy CO26 and a possible Step 3 minimum threshold level of 50,000 tpy CC^e. The annual levels
of regulatory relief associated with these regulatory alternatives are evaluated, as well as, two
27
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and one-half year estimates that cover the Steps 1 and 2 phase-in period and for the full phase-in
period of approximately 5 years.
For the initial phase-in Step 1, only title V and new PSD sources already applying for
permits due to air pollutants other than GHG emissions are required to obtain a permit. New
PSD sources required to obtain permits for GHG must also comply with BACT requirements for
GHG. However, under Step 1, only modification projects or sources with GHG emissions or
emission increases that equal or exceed 75,000 tpy CC^e PTE are required to comply with BACT
requirements for GHG emissions. During Step 2 of the phase-in, sources at or above 100,000
tpy CO26 PTE are required to a obtain title V permit. Likewise, new sources at or above the
100,000 tpy CO26 PTE and modifying sources with PTE at or above 75,000 tpy CC^e are
required to comply with the requirements of PSD. After the initial two steps of the phase-in,
EPA will determine whether a Step 3 that lowers thresholds below 100,000 tpy CO2e PTE
beginning July 2013 is feasible. However, in this final rule, the Agency is making an
enforceable commitment to conduct a regulatory-setting process to consider the experience
during the initial steps prior to lowering the threshold in a further Step 3. EPA also commits to
not lowering the threshold below 50,000 tpy CC^e PTE until 2016. EPA will also conduct a
study of permitting processes at existing levels in the next 5 years and determine whether
thresholds can be lowered below 50,000 tpy CC^e PTE after another regulatory process. At
proposal, EPA identified as the pollutants subject to PSD and title V the group of up to six GHG
emissions, each one weighted for its global warming potential (GWP), that are included in
regulations for their control under the CAA. EPA also proposed to conform its action on PSD
state implementation plans (SIPs) and title V programs to match the proposed Federal
applicability requirements. In its proposed rule, EPA provided temporary regulatory relief for
sources of GHG emissions below a level of 25,000 tpy CC^e PTE.
The rationale for finalizing the previously described thresholds in the tailoring rule is
based in part on our review of the costs and benefits associated with the different thresholds
evaluated and described in this RIA. However, the primary basis for choosing the threshold
enumerated in Table 2.0 is to ensure consistency with the legal doctrines set forth in the
preamble of the tailoring rule. To apply the statutory PSD and title V applicability thresholds to
sources of GHG emissions would create immediate and insuperable administrative burdens for
permitting authorities and perhaps absurd results. By establishing the applicability thresholds at
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the levels for the first and second steps of the phase-in period, we would avoid an
administratively impossible scenario where each year tens of thousands of new sources and
modifications would become subject to PSD review, and, in total, millions of sources would
require title V operating permits. We used the results of this RIA to support the threshold
decisions, which we believe would result in a variance from existing statutory permitting
thresholds that would—consistent with the supporting legal rationale—be as limited as possible
and with consideration given to costs and benefits as described in this RIA.
Table 2.2 describes qualitatively the benefits, costs, and economic impacts analyzed for
regulatory alternatives in this RIA. As shown in Table 2.1, leaving the CAA thresholds
unchanged for sources of GHG emissions is the baseline or 'no action' alternative that will
render this tailoring rule as having no impact on sources or permitting authorities beyond the
current CAA requirements. In this 'no action' case, we are simply comparing the baseline to
itself. Thus, this is a regulatory alternative with zero benefits and zero costs. Under this
alternative, small and large sources of GHG emissions will be required to obtain title V operating
and PSD permits as mandated by the Act. Although this alternative is considered for analytical
completeness, its impact is essentially the same as no GHG tailoring rule and no further
discussion of this alternative is considered in this document. In addition to the 'no action'
alternative, this RIA examines Step 1 and 2 thresholds of the phase-in final rule, as well as a less
Table 2.1. Baseline Sources Subject to Statutory Permit Requirements
Sector
Electricity
Industrial
Energy
Waste Treatment
Agriculture
Commercial
Residential
Totals
Baseline Number of Sources Requiring Permits
100/250 tov CO2e Thresholds
Title V New PSD
2,237
178,037
5,000
4,206
37,351
1,355,921
4,535,500
6,118,252
93
604
48
2
299
12,041
6,915
20,002
Notes: Title V sources are the total number of sources estimated to require an operating permit under statutory CAA
thresholds. PSD sources are new source estimates anticipated to require compliance with permitting annually.
Estimates for PSD sources are for newly constructed facilities and do not include modifications at existing facilities
that may also be subject to PSD requirements.
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than 50,000 tpy CC^e threshold (meaning sources below 50,000 tpy obtain regulatory relief and
this is the minimum level for potential Step 3) and a less than 25,000 tpy CC^e threshold
(meaning sources below 25,000 tpy obtain regulatory relief and this is the proposed rule
threshold level) regulatory alternatives.
The benefits of this rule (and the alternatives considered) are the permit burden costs
avoided due to increasing the threshold levels above current CAA requirements as reflected in
Table 2.1. Under this final rule, millions of title V sources in total and thousands of PSD sources
annually are afforded regulatory relief. For each of the regulatory alternatives increasing the
threshold above statutory levels, the benefits of this tailoring rule are primarily the avoided
permitting costs for affected small sources of GHG emissions. The permitting costs avoided by
small sources are quantified for the final rule Step 1 and 2 thresholds and each of the regulatory
alternatives in Section 3 of this document. The avoided costs associated with compliance with
BACT requirements for PSD new and modifying sources are addressed qualitatively in this RIA
because of lack of sufficient data to estimate quantitative BACT requirements for affected GHG
sources.
The industry categories for sources anticipated to experience regulatory relief at the
threshold levels finalized in this regulation are shown in Table 2.3. As Table 2.3 shows, this
action lifts permitting requirements for over 6 million potential title V sources in total and tens of
thousands of potential PSD new and modifying sources annually otherwise required by the CAA
to obtain permits. The estimates for title V sources represent the total number of sources afforded
regulatory relief by this rule and for regulatory alternatives. In contrast, the estimates shown for
PSD represent the annual estimate of new PSD sources expected to experience regulatory relief
from this rule. For additional industry details including applicable affected industry North
American Classification System (NAICS) codes see Attachment A "Source Categories Affected
by the Rule with Industry Detail."
EPA considered a number of factors involving administrative burden and necessity in
finalizing the thresholds for this rule, including comments received in response to the proposed
rule. After considering the comments regarding the number of affected sources at various
thresholds, EPA revised its estimates of sources potentially required to obtain permits
significantly increasing the number of affected sources at the alternative threshold/significance
levels as discussed in detail previously.
30
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Table 2.2. Qualitative Description of Benefits and Cost of the Tailoring Rule
Description
Benefits
(Regulatory
relief — avoided
permitting
requirements
and associated
costs)
Social Costs
(Foregone
emission
reductions due
to regulating
GHG sources)
Economic
Impacts
(Avoided costs
compared to
annual sales or
revenue data for
affected
sources)
No Action
Alternative
(Thresholds
Remain at
100/250 tpy)1
No avoided
permitting costs
(i.e., over 6
million title V
sources in total
and over 80
thousand PSD
small new and
modifying GHG
sources annually
(over 240
thousand PSD
sources during
Steps 1 and 2)
remain subject to
programs)
No foregone
emission
reductions
No avoided costs
Alternative
(Proposal)
25,000 tpy
GHG Emission
Threshold2
Avoid
permitting costs
for 6.098
million title V
sources in total
and for 72.3
thousand new
and modifying
PSD sources
annually
(or 216.9
thousand PSD
sources during
the Steps 1 and
2 time period)
Foregone GHG
emission
reductions for
affected sources
(addressed
qualitatively)
Impact of
avoided costs
(benefits)
compared to
annual sales
revenues of
affected sources
Alternative
50,000 tpy
GHG Emission
Threshold2
Avoid
permitting costs
for 6. 102
million sources
in total and for
79.7 thousand
new and
modifying PSD
sources annually
(or 239.1
thousand PSD
sources during
the Steps 1 and
2 time period)
Foregone GHG
emission
reductions for
affected sources
(addressed
qualitatively)
Impact of
avoided costs
(benefits)
compared to
annual sales
revenues of
affected sources
Step 2
100,000 tpy
GHG Emission
Threshold2
Avoid
permitting costs
for 6. 105
million sources
in total and for
80.7 thousand
new and
modifying PSD
sources annually
(or 242.1
thousand PSD
sources during
the Steps 1 and
2 time period)
Foregone GHG
emission
reductions for
affected sources
(addressed
qualitatively)
Impact of
avoided costs
(benefits)
compared to
annual sales
revenues of
affected sources
Stepl
Anyway
Threshold2
Avoid
permitting costs
for 6. 106
million sources
in total and for
81.6 thousand
new and
modifying PSD
sources annually
(or 244.8
thousand PSD
sources during
the Steps 1 and
2 time period)
Foregone GHG
emission
reductions for
affected sources
(addressed
qualitatively)
Impact of
avoided costs
(benefits)
compared to
annual sales
revenues of
affected sources
1 This table recognizes that triggering for GHG permitting has occurred with promulgation of the LDVR. Because
of this event, sources with the potential to emit 100 tpy CO2e are required to obtain a title V permit and new or
modifying sources with the potential to emit 250 tpy are required to obtain a PSD permit as mandated by the CAA.
If current threshold levels in the CAA remain unchanged for GHG emissions, the tailoring rule has no effect on
sources or permitting authorities and provides no regulatory relief to sources or permitting authorities.
2 Promulgated Steps 1 and 2 thresholds and alternative regulatory thresholds are shown. Threshold levels represent
PTE levels for affected sources. Sources affected, enumerated above, represent sources, permits, or actions.
Alternative 50,000 tpy CO2e is the minimum threshold level to be considered for a possible Step 3.
-------
Table 2.3. Estimated Number of Affected Sources Experiencing Regulatory Relief for
Final Rule and Regulatory Alternatives1'2'3
Sector
Electricity
Industrial
Energy
Waste Treatment
Agriculture
Commercial
Residential
Totals
% Emissions Covered4
Number of Sources Experiencing Regulatory Relief
Final Rule: Step 2 Final Rule: Step 1
25,000 COie tnv 50,000 COie tov 100,000 COie tnv Anvwav Threshold
Title V New PSD Title V New PSD Title V New PSD Title V New PSD
161
166,908
2,401
1,431
37,351
1,354,760
4,535,340
6,098,352
20
574
23
0
299
12,034
6,912
19,862
3%
285
168,976
2,513
2,448
37,351
1,355,321
4,535,480
6,102,374
29
586
38
1
299
12,038
6,915
19,906
8%
285
170,654
2,536
3,165
37,351
1,355,870
4,535,500
6,105,361
33
599
44
1
299
12,039
6,915
19,930
11%
285
170,910
2,588
3,358
37,351
1,355,921
4,535,500
6,105,913
93
604
48
2
299
12,041
6,915
20,002
13%
1 Number of sources is determined on a PTE basis. Estimates for PSD sources are for newly constructed facilities
and do not include modifications at existing facilities that may also be subject to PSD requirements. Source
estimates shown above represent the total number of title V sources potentially afforded regulatory relief during
Step 1 and 2 of the phase-in period. In contrast, for new PSD sources, the estimates shown are the annual estimates
of permits avoided for new small PSD GHG sources.
2 See Attachment B for more details of how thresholds and sources affected were developed.
3 The "no action" alternative is not included since the number of sources experiencing regulatory relief for this
regulatory alternative is by definition zero.
4 Percentage of emissions covered represents estimated actual emissions from sources expected to experience
regulatory relief as a percentage of total stationary source GHG emissions.
When comparing the regulatory alternatives for revised affected sources at alternative
thresholds as discussed above, there are differences between them. The reason the thresholds
and significance levels are chosen as shown in Table 2.0 for Steps 1 and 2 of the phase-in period
with an additional Step 3 to be considered only after a subsequent regulatory process is because
permitting authorities cannot immediately accommodate a huge increase in permitting. The
thresholds chosen for Steps 1 and 2 are chosen over the proposal level of 25,000 tpy CC^e,
because evidence suggests that permitting authorities can run programs for the levels of
permitting that would be required Steps 1 and 2, and EPA believes legal doctrine requires the
threshold to be as low as administratively feasible. The choice of a threshold is a balancing act
of administrative considerations between threshold levels that EPA feels are not administratively
feasible at this time (i.e., 25,000 tpy CC^e potential to emit threshold) compared to threshold
levels that are not impossible such as the Step 1 'anyway' threshold and the Step 2 100,000 tpy
CO26 threshold achieving a reasonable balance. For more information on the process used to
determine the appropriate thresholds/significance levels for Steps 1 and 2 of the phase-in period,
32
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see Attachment B. There are a number of uncertainties involved in the determination of the
baseline and regulatory alternative affected sources. These threshold analysis uncertainties are
discussed in Section 8 of the RIA.
33
-------
Section 3
Benefits (Regulatory Relief or Avoided Permit Burden Costs)
EPA estimated the regulatory relief or avoided title V and PSD permitting costs for small
sources of GHG that will be postponed as a result of this rulemaking. This analysis focuses on
the burdens that are being lifted for smaller sources as a result of this rule. In addition, an
accounting of the avoided costs to State, local, and tribal permitting authorities is provided.
These avoided costs relate specifically to information collection costs or burden costs for sources
of GHG emissions that would have been required to obtain an operating permit under title V or
required to modify an existing permit to address GHG if not for this rule. Avoided costs shown
also include information collection requirements for additional PSD permits required for new or
modifying sources of GHG, as well as the costs to State, local, and tribal permitting authorities
for extending their existing permitting programs to include sources of GHG. These avoided
costs do not include the cost of modifying and new source compliance with BACT because of
the lack of available data. Within this benefits section of the RIA we are providing an illustrative
monetary estimate of statutory permitting requirements to show the magnitude of the savings that
hypothetically result from this rulemaking. While we believe it is impossible to implement these
permit requirements by January 2, 2011 for the reasons laid out in the preamble, it is useful to
understand the scale of what the burden may have been. For sake of simplicity, we refer to this
illustrative monetary estimate as the monetized benefits of the regulatory relief presented by this
rulemaking or regulatory relief benefits for brevity.
Time and costs associated with permit activities are derived from existing Information
Collection Request (ICR) EPA documents for title V and PSD as described below. Significant
uncertainties exist in the following estimates because of the lack of historical record and
permitting experience on which to base resource needs to consider sources of GHG emissions in
permitting and are discussed more fully in Section 8 of this RIA.
3.1 Avoided Burden Costs for Title V
Under Step 1 of the phase-in, major sources of GHG that would otherwise be required to
obtain an operating permit due to emissions of non-GHG pollutants are required to include GHG
in permit requests. During this period, sources other than those obtaining permits for non-GHG
pollutants will experience regulatory relief. Under Step 2, sources below 100,000 tpy CC>2 e PTE
will experience regulatory relief, while sources above this threshold will be required to obtain
34
-------
operating permits. Table 3.0 shows the estimated annual permitting cost or burden cost avoided
for sources subject to title V experiencing regulatory relief during the period January 2, 2011,
through June 30, 2013, as well as for two other regulatory alternatives. The alternatives shown
are a threshold of 50,000 tpy CC>2 e PTE (the minimum threshold for a possible Step 3) and
25,000 tpy CC>2 e PTE (the proposal threshold level). Estimates shown are the annual portion of
regulatory relief expected to occur for small GHG sources and permitting authorities due to this
final rule and equate to regulatory relief for approximately 2 million title V sources.
As shown on Table 3.0, the cost for a new industrial source to obtain an operating permit
for GHG is $46,350 per permit. Over 71,000 industrial sources are likely to benefit from this
rule because of the postponement of permitting requirements under Steps 1 and 2 of the phase-in
period annually. Approximately 61,836 industrial sources annually will be allowed to postpone
permit revisions for GHG at an avoided cost of $1,677 per permit revision under the 'anyway'
threshold Step 1. The estimate of industrial sources avoiding permit revisions becomes 60,921
annually under Step 2, the less than 100,000 tpy CC^e threshold. The burden cost to obtain a
new commercial or multifamily residential operating permit is approximately $23,175 per permit
with about 2.0 million of these sources annually benefiting from this rule by avoiding these costs
for the phase-in period. The total regulatory relief or benefits for smaller sources of GHG
amount to approximately $49.5 billion per year under Steps 1 and 2 of the phase-in period.
Avoided costs for sources at regulatory alternative threshold levels of 50,000 tpy and 25,000 tpy
CO2e are also presented in Table 3.0. All benefits estimates shown in this report are in 2007$.
State, local, and tribal permitting authorities will also benefit from this rule by avoiding
the administrative burden of processing over 2 million title V operating permits for small
industrial, commercial, and residential sources of GHG annually. Avoided permitting cost
estimates for permitting authorities and sources are calculated based on information obtained
from the April 2007 Information Collection Request for State Operating Permit Regulations4
Annual values are derived from Tables 7 and 8 of this document. For consistency, the permitting
authority labor costs are updated to 2007 dollars using the 2007 General Schedule Salary Table
from the Office of Personnel Management. For the purposes of this analysis, we assume that
4 Information Collection Request for State Operating Permit Regulations (Renewal), EPA ICR Number 1587.07,
OMB Control Number 2060-0243, 2007.
35
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Table 3.0. Annual Title V Regulatory Relief (Avoided Cost) Estimates for Affected Sources of GHG and Permitting
Authorities at Alternative Thresholds1'2'3
Activity
Sources
New Industrial
New Commercial/Residential
Permit Revisions due to GHG
Source Total
Permitting Authority
New Industrial
New Commercial/Residential
Permit Revisions due to GHG
Permitting Authority Total
Total Title V Regulatory Relief
Percentage of Emissions Covered3
Cost per
Permit
(2007$)
$46,350
$23,175
$1,677
$19,688
$9,844
$1,840
Regulatory Alternative
25,000 CO2e tpy
Number
of
Permits
69,726
1,985,504
52,639
2,107,869
69,726
1,985,504
52,639
2,107,869
Avoided
Costs
(millions
2007$)
$3,231.8
$46,014.1
$88.3
$49,334.1
$1,372.8
$19,545.3
$96.9
$21,014.9
$70,349
3%
Regulatory Alternative
50,000 CO2e tpy
Number
of
Permits
70,848
1,985,740
59,930
2,116,518
70,848
1,985,740
59,930
2,116,518
Avoided
Costs
(millions
2007$)
$3,283.8
$46,019.5
$100.5
$49,403.8
$1,394.9
$19,547.6
$110.3
$21,052.8
$70,456.6
8%
Final Rule: Step 2
100,000 CO2e tpy
Number of
Permits
71,657
1,985,930
60,921
2,118,508
71,657
1,985,930
60,921
2,118,508
Avoided
Costs
(millions
2007$)
$3,321.3
$46,023.9
$102.2
$49,447.4
$1,410.8
$19,549.5
$112.1
$21,072.4
$70,519.8
11%
Final Rule: Step 1
Anyway Threshold
Number
of
Permits
71,829
1,985,948
61,836
2,119,613
71,829
1,985,948
61,836
2,119,613
Avoided
Costs
(millions
2007$)
$3,329.3
$46,024.3
$103.7
$49,457.3
$1,414.2
$19,549.7
$113.8
$21,077.6
$70,534.9
13%
Sums may not add due to rounding.
1 Avoided costs shown represent the annual estimates of the regulatory burden relief from this rule and for regulatory alternatives for over 2 million sources of
GHGs (about 1/3 of the total number of title V sources expected to obtain regulatory relief). See Appendix B and C for more details. Sources experiencing
regulatory relief are those with the potential to emit less than the threshold levels annually.
2 These estimates are explained in more detail in Attachment C " Summary of Methodology and Data Used to Estimate Burden Relief and Evaluate Resource
Requirements at Alternative Greenhouse Gas Permitting Thresholds."
3 Percentage of emissions covered represents estimated actual emissions from sources expected to experience regulatory relief as a percentage of total stationary
source GHG emissions.
-------
commercial/residential sources that exceed the major source threshold due to GHG emissions
will not likely have as substantial applicable permitting cost requirements as industrial
sources. We assumed that permits for such sources will require only one half the time to prepare
and issue as those for industrial sources, which have applicable requirements in addition to GHG.
Therefore, it is estimated that new commercial/residential permits require 50 percent of the time
needed for new industrial permits, or 214 hours compared to 428 hours for permitting authorities.
For significant revisions and permit renewals, it is assumed that incorporating GHG information
adds 40 hours, or an additional 10 percent to the current updating and processing time. For more
information on the methods used to calculate permit processing costs for permitting authorities
for title V permitting, see Attachment C, "Summary of Methodology and Data Used to Estimate
Burden Relief and Evaluate Resource Requirements at Alternative Greenhouse Gas Permitting
Thresholds."
The cost savings for permitting authorities relating to title V are summarized in Table 3.0
and are estimated to exceed $21 billion annually. Costs avoided annually for permitting
authorities at alternative threshold levels other than Steps 1 and 2 are also shown on Table 3.0.
This rule specifies a phased-in step approach to establish title V and PSD thresholds. For
this reason, it is appropriate to assess the regulatory relief during the various steps of the phase-in
period in addition to looking at regulatory relief on an annual basis as previously discussed.
Since thresholds for only Steps 1 and 2 are promulgated in this rulemaking with a potential Step
3 to be considered only after subsequent rulemaking, we calculate the regulatory relief possible
for a two and one-half year period, the approximate time period covered by Steps 1 and 2 of this
tailoring rule. Considering the regulatory relief for the 2.5 year period allows us to evaluate
alternative regulatory relief based not only on threshold levels, but also based upon the timing of
the steps of the phase-in period. Table 3-1 presents the Steps 1 and 2 regulatory relief for title V
based upon alternative regulatory thresholds and the timing of the phase-in steps. Alternatives of
25,000 tpy CO2e, 50,000 tpy CO2e, 100,000 tpy CO2e, and the 'anyway' thresholds are evaluated
as if they were implemented for the entire Step 1 and 2 period. The 25,000 tpy CO2e and the
'anyway' threshold regulatory relief shown represent the bounding estimates for regulatory relief
for these threshold alternatives as well as alternative timings of the steps. If the 25,000 tpy CO2e
threshold were imposed for Steps 1 and 2 of the phase-in, regulatory reliefer avoided title V
permitting costs for sources and permitting authorities would amount to approximately $175.9
37
-------
billion for a Steps 1 and 2 phase-in period. Alternatively if the 'anyway' based threshold were
imposed for a 2.5 year period, the regulatory relief would be $176.3 billion for sources and
permitting authorities during the first two steps of the phase-in period. The final tailoring rule
promulgated, establishes the 'anyway' threshold for Step 1 and 100,000 tpy CC^e threshold for
Step 2. The total regulatory relief for the final rule for the 2.5 year period for title V is estimated
to be $176.3 billion. Altering Step 2 to be 25,000 tpy CO2e and 50,000 tpy CO2e with Step 1 as
the 'anyway' threshold would result regulatory relief estimates for the three year period of $176
billion and $176.2 billion, respectively.
3.2 Avoided Information Collection Costs Associated with the PSD Program
This rulemaking limits the new sources requiring PSD permits for Step 1 to those that
would be required to comply with PSD for non-GHG emissions. For modifying sources, the
significance level requiring permits is 75,000 or greater tpy CC^e PTE. In Step 2 of the phase-in
period, the threshold becomes 100,000 tpy CC^e PTE or greater for new sources and the
significance level for modifying sources remains at 75,000 or greater tpy CC^e. Table 3.2
summarizes the estimated benefits to small GHG sources resulting from this final rule. Annual
regulatory relief for Steps 1 and 2 of the phase-in period, as well as additional alternative
regulatory thresholds, are depicted on Table 3.2. The estimated annual burden or permit-related
costs avoided by small GHG sources amount to around $5.5 billion annually during Step 1 and
$5.4 billion during Step 2 with the burden costs per permit expected to be $131 thousand for new
sources, $84.5 thousand for modified industrial sources, $82.3 thousand for new commercial or
residential sources, and $59.2 thousand for modifying commercial and residential sources. State,
local, and tribal permitting authorities are expected to avoid administrative costs of $1.5 billion
under Step 1 and $1,485 million under Step 2 annually.
Burden estimates for the PSD program permitting authorities are calculated based on
listed values obtained from Tables 6-1 and 6-2 on pages 18-19 in the Information Collection
Request for Prevention of Significant Deterioration and Nonattainment New Source Review
38
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Table 3-1. Steps 1 and 2 Title V Regulatory Relief (Avoided Cost) Estimates for Affected Sources of GHG and Permitting
Authorities at Alternative Thresholds1'2
Activity
Sources
New Industrial
New
Commercial/Residential
Permit revisions due to
GHG
Source Total
Permitting Authority
New Industrial
New
Commercial/Residential
Permit revisions due to
GHG
Permitting Authority
Total
Total Title V Regulatory
Relief
Regulatory Relief Estimates for Step 1 and 2 of the Phase-In Period (January 2, 2011 through July 1, 2013)
Regulatory Alternatives (Avoided Permittin
25,000 CO2e tpy
$8,079.5
$115,035.3
$220.8
$123,335.5
$3,431.9
$48,863.3
$242.1
$52,537.3
$175,872.8
50,000 CO2e tpy
$8,209.5
$115,048.8
$251.3
$123,509.5
$3,487.2
$48,869.1
$275.7
$52,632
$176,141.5
100,000 CO2e tpy
$8,303.3
$115,059.8
$255.5
$123,618.5
$3,527
$48,873.7.0
$280.2
$52,680.9
$176,299.4
Anyway
Threshold
$8,323.3
$115,060.8
$259.3
$123,643.3
$3,535.4
$48,874.2
$284.5
$52,694.1
$176,337.5
g Costs in million 2007$)
Anyway/ 50,000
$8,232.3
$115,051.2
$252.9
$123,536.3
$3,496.8
$48,870.1
$277.4
$52,644.3
$176,180.6
Anyway/25,000
$8,128.3
$115,040.4
$228.5
$123,397.1
$3,452.6
$48,865.4
$250.6
$52,568.6
$175,965.7
Final Rule
Anyway/100,000
$8,307.3
$115,060.0
$256.3
$123,623.5
$3,528.7
$48,873.8
$281.1
$52,683.6
$176,307.1
VO
Benefits represent regulatory relief or avoided costs for sources with the potential to emit below the thresholds shown.
1 Avoided costs shown represent the 21A year estimates of the regulatory burden relief from this rule and for regulatory alternatives for Steps 1 and 2 for
the period Jan. 2, 2011 through July 1, 2013. Alternatives 25,000 CO2e tpy, 50,000 CO2e tpy, 100,000 CO2e tpy, and non-GHG based assume these
thresholds remain in effect for entire 21A years. Alternatives Anyway/50,000 and Anyway/25,000 assume the Anyway threshold for Step 1 and 50,000
CO2e tpy and 25,000 CO2e tpy thresholds for Step 2, respectively. Finally the final rule estimates shown in the last column of the table assume the
Anyway threshold for Step 1 (one half year) and the 100,000 CO2e tpy threshold for Step 2 (two years).
Sums may not add due to rounding.
2 These estimates are explained in more detail in Attachment C "Summary of Methodology and Data Used to Estimate Burden Relief and Evaluate
Rprmirpmpnts at Alternative Greenhouse Gas Permitting Thresholds "
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Table 3.2. Annual PSD Regulatory Relief (Avoided Costs) for Sources of GHG and Permitting Authorities at Alternative
Thresholds
1,2
Activity
Sources
New Industrial
New Commercial/Residential
Source Total
Permitting Authority
New Industrial
New Commercial/Residential
Permitting Authority Total
Total PSD Regulatory Relief
Cost
per
Permit
(2007$)
$84,530
$59,152
$23,243
$16,216
Regulatory Alternative
25,000 CO2e tpy
Number
of
Permits
16,892
55,446
72,338
16,892
55,446
72,338
Avoided
Costs
(millions
2007$)
$1,427.9
$3,279.7
$4,707.6
$392.6
$899.1
$1,291.7
$5,999.4
Regulatory Alternative
50,000 CO2e tpy
Number
of
Permits
24,183
55,481
79,664
24,183
55,481
79,664
Avoided
Costs
(millions
2007$)
$2,044.2
$3,281.8
$5,326.0
$562.1
$899.7
$1,461.8
$6,787.8
Step 2
100,000 CO2e tpy
Threshold,
75,000 CO2e tpy
Significance Level
Number
of Permits
25,174
55,505
80,679
25,174
55,505
80,679
Avoided
Costs
(millions
2007$)
$2,128.0
$3,283.2
$5,411.2
$585.1
$900.1
$1,485.2
$6,896.4
Stepl
Anyway
75,000 CO2e tpy
Significance Level
Number
of
Permits
26,089
55,509
81,598
26,089
55,509
81,598
Avoided
Costs
(millions
2007$)
$2,205.3
$3,283.5
$5,488.8
$606.4
$900.1
$1,506.5
$6,995.3
1 Avoided costs shown represent annual estimates of the regulatory burden relief for this rule and for regulatory alternatives for sources with the potential to emit
below the threshold. Sums may not add due to rounding.
2 Attachment C: "Summary of Methodology and Data Used to Estimate Burden Relief and Evaluate Resource Requirements at Alternative Greenhouse Gas
Permitting Thresholds
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August 2008.5 As shown in Table 3.2, State, local, and tribal permitting authorities are
estimated to expend $23,243 per permit to process a new GHG industrial PSD
permit and $16,216 per permit for a new commercial or residential PSD permit. It is assumed
that permit preparation and issuance for commercial/residential permits require less time to
prepare and issue than industrial source permits since commercial/residential sources would
likely be somewhat less complex in terms of numbers and types of emission sources and control
requirements. Estimates obtained are additional burden and costs to those currently experienced
by permitting authorities and sources. For more information on the estimates of burden costs for
PSD permits, see Attachment C. Avoided costs estimates for regulatory alternatives of 25,000
tpy (proposal level) and 50,000tpy CC^e PTE are also shown in Table 3.2. The PSD estimated
costs on Table 3.2 represent annual estimates of costs avoided for sources and permitting
authorities.
Regulatory relief alternatives for Steps 1 and 2 for PSD are shown on Table 3.3.
Evaluating regulatory alternatives for the approximate 2.5 year time period covered by Steps 1
and 2 provides comparisons of the threshold levels and the impacts of timing choices for the
steps. As shown on Table 3.3, regulatory alternatives of 25,000 tpy CC^e, 50,000 tpy CC^e,
100,000 tpy CO26, and the 'anyway' thresholds are evaluated as if they were implemented for
the entire two step phase-in period. The 25,000 tpy CC^e and the 'anyway' thresholds represent
the bounding alternatives over the period with the 25,000 tpy CC^e alternative providing the
least regulatory relief and the 'anyway' threshold the greatest. If the 25,000 tpy CO2e were
implemented for Steps 1 and 2, the regulatory relief for PSD sources would amount to
approximately $14,998.3 million during the Steps 1 and 2 phase-in period. This regulatory relief
would be $17,488.3 million over the same period with the 'anyway' threshold. All other
alternatives shown and combinations of regulatory alternatives within the 2.5 year time frame lie
within the 25,000 tpy CC^e threshold and the 'anyway' threshold. The final rule 'anyway'
threshold for Step 1 and 100,000 tpy CO2e threshold for Step 2 results in PSD regulatory relief of
$17,290.5 million for the 2.5 year phase-in period.
This rule also alleviates the regulatory burden associated with complying with PSD
BACT requirements for small new and modifying sources. The BACT costs foregone are not
' Prevention of Significant Deterioration and Non-Attainment Area New Source Review (Renewal), EPA ICR Number 123.23,
OMB Control Number 2060-0003, 2008.
41
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estimated or shown in Tables 3.2 or 3.3 because of the significant uncertainties involved in these
requirements for affected sources and lack of sufficient information to estimate these costs
currently. Likewise, the foregone emission reductions associated with these BACT requirements
for small sources are not estimated. This issue is discussed further in Section 4 of this RIA. The
benefits estimates for this rule are subject to limitations and uncertainties that are discussed in
Sections of this RIA.
Table 3.4 presents the title V and PSD regulatory relief for the full phase-in period of
approximately five years. The final rule benefits are shown for two alternatives for Step 3, one
in which Step 3 remains at the Step 2 level and one in which Step 3 becomes the minimum
threshold of at least 50,000 tpy CC^e previously discussed. These alternatives for Step 3 bound
the net benefit estimates for the entire phase in period. If Step 3 remains at the Step 2 level, net
benefits for the five year period are $387,153.4 +B million. This benefit estimate becomes
$386,724.1 +B million if Step 3 becomes the minimum level of 50,000 tpy for the five year
phase-in period. The letter B represents the benefits we are not able to quantify in this analysis
and are discussed in section 8 of this report. Given the short time frame of the impact of this final
rule, we did not consider the time value of money or discount the benefit and cost estimates
provided in this report, rather we assume these benefit and cost estimates are occurring currently.
All benefit dollar estimates shown are based upon 2007$.
42
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Table 3.3 Step 1 and 2 PSD Regulatory Relief (Avoided Costs) for Sources of GHG and Permitting Authorities at Alternative
Thresholds
1,2
Activity
Sources
New Industrial
New Commercial/Residential
Source Total
Permitting Authority
New Industrial
New Commercial/Residential
Permitting Authority Total
Total PSD Regulatory Relief
Regulatory Relief for Step 1 and 2 Phase-in Period ( January 2, 2011 through July 1, 2013)
Regulatory Alternatives (Avoided Permitting Costs in millions 2007$)
25,000 CO2e tpy
$3,569.8
$8,199.3
$11,769.0
$981.5
$2,247.8
$3,229.3
$14,998.3
50,000 CO2e tpy
$5,110.5
$8,204.5
$13,315.0
$1,405.3
$2,249.3
$3,654.5
$16,969.5
100,000 CO2e tpy
$5,320.0
$8,208.0
$13,528.0
$1,462.8
$2,250.3
$3,713.0
$17,241.0
Anyway
Threshold
$5,513.3
$8,208.8
$13,722.0
$1,516.0
$2,250.3
$3,766.3
$17,488.3
Anyway/50,000
$5,191.1
$8,205.4
$13,396.4
$1,427.4
$2,249.5
$3,676.9
$17,073.3
Anyway/25,000
$3,958.5
$8,201.2
$12,159.6
$1,088.4
$2,248.3
$3,336.7
$15,496.3
Final Rule
Anyway/100,000
$5,358.7
$8,208.2
$13,566.8
$1,473.4
$2,250.3
$3,723.7
$17,290.5
Benefits are regulatory relief or avoided costs for sources with the potential to emit below the thresholds shown.
1 Avoided costs shown represent the 1l/i year estimates of the regulatory burden relief from this rule and for regulatory alternatives for Steps 1 and 2 of the phase-
in period January 2, 2011 through July 1, 2013. Alternatives 25,000 CO2e tpy, 50,000 CO2e tpy, 100,000 CO2e tpy, and 'anyway' assume these thresholds
remain in effect for 1l/i years. Alternatives Anyway/50,000 and Anyway/25,000 assume the Anyway threshold for Step 1 and 50,000 CO2e tpy and 25,000
CO2e tpy thresholds for Step 2, respectively. Finally the final rule estimates shown in the last column of the table show the Anyway threshold for Step 1 (one
half year), and the 100,000 CO2e tpy threshold for Step 2 (two years). Sums may not add due to rounding.
2 Attachment C: "Summary of Methodology and Data Used to Estimate Burden Relief and Evaluate Resource Requirements at Alternative Greenhouse Gas
Permitting Thresholds."
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Table 3.4 Benefits of the Final Rule and Step 3 Regulatory Alternatives
Benefits for the Five Year Period Beginning
January 2, 2011
Benefits - Regulatory Relief
Sources
Title V1
PSD2
Total Source Regulatory Relief
Permitting Authority
Title V1
PSD2
Total Permitting Authority
Total Regulatory Relief
Regulatory Alternative (millions 2007$)
Final Rule + Possible Step 3 of
100, 000 tpy CO2e3
$247,253.6
$27,094.7
$274,348.3
$105,368.5
$7,436.61
$112,805.1
$387,153.4+5
50, 000 tpy CO2e4
$247,145.3
$26,881.8
$274,027.1
$105,318.8
$7,378.1
$112,696.8
$386,724.1+5
Benefits are regulatory relief for sources with the potential to emit below the thresholds shown.
B - unqualified benefits of the rule include regulatory relief from B ACT requirements for PSD sources
IReflects estimates of regulatory relief or avoided permit burden costs for title V GHG sources and
permitting authorities.
2 Shows estimates of regulatory relief or avoided permit burden costs for GHG PSD sources and
permitting authorities.
3 Includes 1/2 year of Step 1 (anyway threshold), 41/2 years of Step 2 (100,000 threshold),
4 Includes 1/2 year of Step 1 (anyway threshold), 2 years of Step 2 (100,000 threshold), and 21/2 years of
Step 3 alternative of 50,000.
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Section 4
Social Costs
EPA examined the social costs of this final rule. For this rule, the social costs represent
the foregone environmental benefits that would occur if regulatory relief was not offered to small
sources of GHG emissions. This action is one of regulatory relief since it increases the emissions
thresholds for the title V and PSD programs, as they apply to sources of GHG, to levels above
those in the CAA. Previous sections have discussed the avoided cost of such relief, but there is
also a social cost imposed by such relief because this rule may forego some of the possible
benefits associated with title V and PSD programs for sources of GHG emissions below Step 1
and 2 phase-in thresholds but above the statutory 100/250 tpy levels. These benefits are those
attributed to title V and PSD permitting programs in general. These benefits are based on the
relevance of these programs to policymaking, transparency issues, and market efficiency and,
therefore, are very difficult to quantify and monetize. For title V, they include the benefits of
improved compliance with CAA requirements that stem from (1) improved clarity regarding
applicability of requirements; (2) discovery and required correction of noncompliance prior to
receiving a permit; (3) improving monitoring, recordkeeping, and reporting concerning
compliance status; (4) self-certification of compliance with applicable requirements initially and
annually, and prompt reporting of deviations from permit requirements; (5) enhanced
opportunity for the public to understand and monitor sources' compliance obligations; and (6)
improved ability of EPA, permitting authorities, and the public to enforce CAA requirements.
However, it is important to remember that a title V permit does not add new requirements
for pollution control itself but rather collects all of a facility's applicable requirements under the
CAA in one permit. Therefore, the compliance benefits above are less when title V permits
contain few or no CAA applicable requirements. During the first two steps of this phase-in
period, we expect that the vast majority of sources excluded from title V would be sources that
have no CAA applicable requirements for GHG emissions and few or no requirements for other
pollutants because their emissions of those pollutants are so small. For this reason, although it is
extremely difficult to measure the degree of improved compliance, if any, that would be
foregone or to quantify the social costs that would be imposed, we expect that they would be
negligible.
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For PSD, the primary social cost imposed by the tailoring rule stems from the foregone
benefit of applying BACT to the tens of thousands of small new sources and modifications that
will be below our thresholds during the first phase. This social cost potentially weighs against
the cost savings described above that stem (in part) from avoiding the administrative and control
costs of applying BACT to these sources. The BACT requirement ensures that when new and
modified sources increase their emissions they are using state-of-the-art emission controls and
afford the public an opportunity to comment on the control decision. It does not prohibit
increases, but it ensures that such controls are applied. Delaying the BACT requirement for
numerous small sources during the first phase of this rule could allow increases from these
smaller sources that are greater than they would be if BACT were applied. A detailed analysis of
this difference is beyond the scope of this rule because we do not have detailed information on
the universe of these tens of thousands of small PSD actions, the candidate BACT technologies
for each of them, how permitting authorities would make the BACT decisions, and how the
BACT limit would compare to what would otherwise be installed absent BACT. Below we
present an illustrative example of how BACT impacts might be determined for sources that
would be excluded from review under the tailoring rule. This example illustrates the difficulty in
quantifying the social costs of avoided BACT but helps explain the nature of such costs.
To assess the effect of avoided BACT, we would identify the universe of source types
that are affected by the tailoring rule. More specifically, we would have to project the number of
various source types (within those affected by the tailoring rule) that would actually be
constructing or modifying. We have generally characterized these sources as part of the tailoring
rule threshold evaluation and have determined a large proportion of these to consist of small
commercial and residential sources. This determination was based on rough energy usage data,
but to assess BACT, we would require more specific information about the proposed equipment
that will actually be emitting GHG (e.g., water heaters, furnaces, cooking equipment, dryers),
and more specific characterization would be subject to a very high degree of uncertainty.
Following characterization of new and modified sources, we would need to determine,
for each category of source, what GHG control technologies are available for such equipment.
For commercial sources, we may have to determine commercial availability of a range of lower
emitting processes, more efficient technologies, and other techniques for improving energy
efficiency. Next, we would assess affected sources' capital and operating costs of control
46
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options and determine energy and environmental impacts. Finally, we would need to apply
judgment (as the permitting authority would do in each case) to select the technology that
represented the maximum degree of control taking the costs, energy, and environmental impacts
into account.
The social cost component of the impact of foregoing BACT for sources that construct or
modify during the first phase would be represented by the difference between the increased
emissions that would result from such sources absent BACT and the increase that would be
allowed under the BACT requirement. However, although we can point to the existence of such
differences, we cannot quantify them (though as explained below we expect that overall they will
be very limited in scope and magnitude). Since there has been no regulatory experience with
controlling GHG emissions from these sources, and limited permitting experience of any kind
with mandatory control requirements on smaller commercial and residential sources, we are not
in a position at this point to identify the specific control technologies and quantify this difference
to estimate the greater increases that might occur in the absence of applying the BACT process to
these sources across the country. In addition, since the PSD BACT review and selection process
is implemented on a case-by-case basis, there is additional uncertainty in predicting program-
wide reductions because even for similar sources, permitting authorities may ultimately weigh
the BACT factors differently and adopt different control measures.
For all these reasons, it is not possible at this time to quantify the social costs of avoided
BACT. However, we note that the universe of possible emissions that would be regulated by
sources excluded under the tailoring rule is small compared to those that would remain subject to
PSD. The sources excluded in the first steps of this phased-in rule comprise only 11 percent of
total stationary source GHG emissions, while 68 percent remain subject to regulation. The
remaining fraction of stationary GHG source emissions come from sources below statutory CAA
thresholds of 100/250 tons per year. Furthermore, we expect the emissions differences due to
BACT controls for sources excluded by the tailoring rule to be relatively small because of the
lack of available cost-effective capture and control technologies for GHG at such sources that are
akin to those that exist for conventional pollutants and large sources, as well as the likelihood
that even in the absence of BACT such sources would already be installing relatively efficient
GHG technologies to save on fuel costs. Thus, although potential benefits would be foregone by
excluding smaller sources from the permitting programs, these benefits are likely to be small.
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Under the tailoring rule, we will work during the 6-year period to greatly improve our
understanding of both the administrative costs of regulating and the social costs of not regulating
smaller sources under PSD and title V, and we will rely on that information to support our future
threshold analyses called for under the rule.
Since EPA is unable to quantify these GHG emission reductions foregone at this time
because of these uncertainties involved in this estimation, it is also not possible to provide a
monetized estimate of the foregone benefits or social costs of this rule. If such emission
reductions foregone were quantified, EPA could use the social cost of carbon benefit estimates
such as those used in the "Rulemaking to Establish Light Duty Vehicle Greenhouse Gas
Emission Standards and Corporate Average Fuel Economy Standards"6 recently published to
compute the dollar value associated with the social costs of this rule. Nonetheless, we expect
that the value would be small because, as discussed above, the emissions differences from which
this value would be computed are small.
In reaching the decisions for this GHG tailoring rule, EPA recognizes the GHG emissions
can remain in the atmosphere for decades to centuries, meaning that their concentrations become
well mixed throughout the global atmosphere regardless of emission origin, and their effects on
climate are long lasting and significant. A detailed explanation of climate change and its impact
on health, society, and the environment is included in EPA's technical support document for the
endangerment finding (Docket ID No. EPA-HQ-OAR-2009-0171). EPA recognizes the
importance of reducing climate change emissions for all sources of GHG emissions, including
those sources afforded regulatory relief in this rule, and plans to address potential emission
reductions from these small sources using voluntary and energy efficiency approaches.
Elsewhere, we have discussed EPA's interest in continuing to use regulatory and/or
nonregulatory tools for reducing emissions from smaller GHG sources because we believe that
these tools will likely result in more efficient and cost-effective regulation than would case-by-
case permitting.
6 U.S. EPA 2010. Rulemaking to Establish Light Duty Vehicle Greenhouse Gas Emission Standards and Corporate
Average Fuel Economy Standards. EPA-HQ-OAR-2009-0472.
http://www.epa.gov/otaq/climate/regulations/ghg-preamble-regs.pdf.
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Section 5
Net Benefits
The net benefits of this GHG tailoring rule represent the difference between the benefits
and costs of this rule to society. This section presents the net benefits of the final rule and other
regulatory alternatives. As discussed in Section 3, this rule is one of regulatory relief and the
benefits to society are estimates the regulatory relief (avoided permit burden costs) to sources
and permitting authorities for Steps 1 and 2 of the phase-in period. Within this RIA we are
providing an illustrative monetary estimate of statutory permitting requirements to show the
magnitude of the savings that hypothetically result from this rulemaking. While we believe it is
impossible to implement these permit requirements by January 2, 2011 for the reasons laid out in
the preamble, it is useful to understand the scale of what the burden may have been. For sake of
simplicity, we refer to this illustrative monetary estimate as the monetized benefits of the
regulatory relief presented by this rulemaking or regulatory relief benefits for brevity. The social
costs of the rule are the foregone environmental benefits in the form of potential GHG emission
reductions that could occur during the phase-in period and are discussed in Section 4.
This rulemaking provides regulatory relief for a phase-in period of approximately 5 years
to smaller sources of GHG by phasing in the statutory permitting threshold at levels above
statutory requirements. This final rule establishes thresholds and PSD significance levels for
Steps 1 and 2 of the phase-in period (the 2.5 year period between January 2, 2011 and July 1,
2013), commits to considering a further Step 3, and indicates floor title V and PSD threshold
levels from July 1, 2013 through April 30, 2016. While the EPA commits to undertake a
rulemaking for a further Step 3, the ultimate outcome for sources of GHG from this additional
rulemaking is unknown at this time.
Annual estimates for the final rule Steps 1 and 2 and regulatory alternatives are presented
in Table 5.1. As Table 5.1 indicates, the annual net benefits associated with the final rule Step 1
are $77,530.2 million +B-C and for Step 2 are $77,416.2 +B-C million annually, where B
denotes the unquantified benefits and C the quantified costs of this final rule. These unquantified
benefits and costs are discussed in more detail in the limitations and uncertainties Section 8 of
this report. Table 5.2 shows the final rule Steps 1 and 2 with regulatory alternatives for the two
and one-half year phase-in period January 2, 2011 through July 1, 2013. The net benefits of the
final rule for Steps 1 and 2 are $193,597.5+5-C million for the two and one-half year period.
49
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Finally, Table 5.3 presents the final rule net benefits with two alternatives for Step 3, one in
which Step 3 remains at the Step 2 level of 100, 000 tpy CC^e and one in which Step 3 becomes
the minimum threshold of at least 50,000 tpy CO2e previously discussed. These alternatives for
Step 3 bound the net benefit estimates for the entire phase in period. If Step 3 remains at the
Step 2 level, net benefits for the five year period are $387,153.4 +B-C million. This net benefit
estimate becomes $386,724.1 +B-C million if Step 3 becomes the minimum level of 50,000 tpy
CO26 threshold for the five year phase-in period. Given the short time frame of the impact of this
final rule, we did not consider the time value of money or discount the benefit and cost estimates
provided in this report, rather we assume these benefit and cost estimates are occurring currently.
All dollar estimates shown are based upon 2007$.
Table 5.1 Annual Net Benefits for GHG Tailoring Rule Regulatory Alternatives
Benefits - Regulatory Relief
Sources
Title V1
PSD2
Total Source Regulatory Relief
Permitting Authority
Title V1
PSD2
Total Permitting Authority
Total Regulatory Relief
Costs - Foregone GHG Emission Reductions
Title V & PSD
Net Benefits3
Annual Benefits and Costs for Regulatory Alternatives (millions of 2007S)3
Final Rule Step 1
Anyway
$49,457.3
$5,488.8
$54,946.1
$21,077.6
$1,506.5
$22,584.1
$77,530.2+B
C
$77,530.2+B-C
Final Rule Step 2
100,000 tpy CO2e
$49,447.4
$5,411.2
$54,858.6
$21,072.4
$1,485.2
$22,557.6
$77,416.2+B
C
$77,416.2+B-C
50,000 tpy CO2e
$49,403.8
$5,326.0
$54,729.8
$21,052.8
$1,461.8
$22,514.6
$77,244.4+B
C
$77,244.4+B-C
25,000 tpy CO2e
$49,334.2
$4,707.6
$54,041.8
$21,014.9
$1,291.7
$22,306.6
$76,348.4+B
C
$76,348.4+B-C
Benefits are regulatory relief or avoided permit costs for sources with the annual potential to emit less than the threshold shown.
B - unqualified benefits of the rule include regulatory relief from B ACT requirements for PSD sources
C - unqualified social costs of tailoring rule represents economic value of foregone environmental benefits
(possible GHG emission reductions) during Step 1 and 2 of the phase in period. Potential foregone GHG emission reductions during the
phase-in period are not known at this time. See Section 4 of the RIA for a qualitative discussion of the social costs of the rule.
IReflects estimates of regulatory relief or avoided permit burden costs for title V GHG sources and permitting authorities.
2 Shows estimates of regulatory relief or avoided permit burden costs for GHG PSD sources and permitting authorities.
3 Totals may not sum due to rounding.
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Table 5.2. Net Benefits of the Final GHG Tailoring Rule and Regulatory Alternatives
Benefits - Regulatory Relief
Sources
Title V1
PSD2
Total Source Regulatory Relief
Permitting Authority
Title V1
PSD2
Total Permitting Authority
Total Regulatory Relief
Costs - Foregone GHG Emission
Reductions
Title V & PSD
Net Benefits
Step 1 and 2 Phase-In Period (January 2, 2011- July 1, 2013)
Regulatory Alternatives (millions of 2007$)
Anyway3
$123,643.3
$13,722.0
$137,365.3
$52,694.1
$3,766.3
$56,460.4
$193,825.6+5
C
$193,825.6+B-C
100,000 tpy
C02e3
$123,618.5
$13,528.0
$137,146.5
$52,681
$3,713.0
$56,393.9
$193,540.4+5
C
$193,540.4+B-C
50,000 tpy
C02e3
$123,509.5
$13,315.0
$136,824.5
$52,631.9
$3,654.5
$56,286.3
$193,110.9+5
C
$193,110.9+B-C
25,000 tpy
C02e3
$123,335.5
$11,769.0
$135,104.5
$52,537.3
$3,229.3
$55,766.7
$190,871.1+5
C
$190,871.1+B-C
Anyway/50,0004
$123,536.3
$13,396.4
$136,932.8
$52,644.3
$3,676.8
$56,321.1
$193,253.9+5
C
$193,253.9+B-C
Anyway/25,0005
$123,397.1
$12,159.6
$135,556.6
$52,568.7
$3,336.7
$55,905.4
$191,462.0+5
C
$191,462.0+B-C
Final Rule6
$123,623.5
$13,566.8
$137,190.3
$52,683.6
$3,723.6
$56,407.2
$193,597.5+5
C
$193,597.5+B-C
Benefits represent regulatory relief for those sources with the annual potential to emit less than the threshold shown.
B - unqualified benefits of the rule include regulatory relief from BACT requirements for PSD sources
C - unqualified social costs of tailoring rule represents economic value of foregone environmental benefits (potential GHG emission reductions) during Step 1 and 2 of the phase in
period. Foregone GHG emission reductions are not known at this time. See Section 4 of the RIA for a qualitative discussion of the social costs of the rule.
IReflects estimates of regulatory relief or avoided permit burden costs for title V GHG sources and permitting authorities.
2 Shows estimates of regulatory relief or avoided permit burden costs for GHG PSD sources and permitting authorities.
3 Shows alternative as single step for the 21/2.year phase-in period for 'anyway', 100,000 tpy CO2e, 50,000 tpy CO2e, and 25,000 tpy CO2 e thresholds respectively.
4 Includes Step 1 for one-half year and 50,000 tpy CO2e threshold for two years.
5 Includes Step 1 for one-half year and 25,000 tpy CO2e threshold for two years.
6 Phase-in period for final rule includes 1/2 year of Step 1 'anyway' threshold and 2 years of Step 2 100,000 tpy CO2e threshold.
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Table 5.3 Net Benefits of the Final Rule and Step 3 Regulatory Alternatives
Benefits - Regulatory Relief
Sources
Title V1
PSD2
Total Source Regulatory Relief
Permitting Authority
Title V1
PSD2
Total Permitting Authority
Total Regulatory Relief
Costs - Foregone GHG Emission
Reductions
Title V & PSD
Net Benefits
Regulatory Alternatives (millions 2007$)
Final Rule + Possible Step 3 (five year period)
100, 000 tpy CO2e3
$247,253.6
$27,094.7
$274,348.3
$105,368.5
$7,436.61
$112,805.1
$387,153.4+5
C
$387,153.4+B-C
50, 000 tpy CO2e4
$247,144.1
$26,881.8
$274,025.9
$105,320.2
$7,378.1
$112,698.2
$386,724.1+5
C
$386,724. 1+B-C
Benefits are regulatory relief for sources with the annual potential to emit less than the thresholds shown.
B - unqualified benefits of the rule include regulatory relief from B ACT requirements for PSD sources
C - unqualified social costs of tailoring rule represents economic value of foregone environmental benefits
(potential GHG emission reductions) during Step 1, 2,and 3 of the phase in period.
Foregone GHG emission reductions are not known at this time.
See Section 4 of the RIA for a qualitative discussion of the social costs of the rule.
IReflects estimates of regulatory relief or avoided permit burden costs for title V GHG sources and permitting
authorities.
2 Shows estimates of regulatory relief or avoided permit burden costs for GHG PSD sources and permitting
authorities.
3 Includes 1A year of Step 1 (anyway threshold), 2 years of Step 2 (100,000 threshold), and 2!/2 years of Step 3
(alternative of 100,000 threshold). Covers five year period beginning January 2, 2011.
4 Includes 1A year of Step 1 (anyway threshold), 2 years of Step 2 (100,000 threshold),
and 21/2 years of Step 3 (alternative of 50,000 threshold). Covers five year period beginning January 2, 2011.
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Section 6
Impacts of Regulatory Relief
This final rulemaking does not impose economic impacts on any sources or permitting
authorities but should instead be viewed as regulatory relief for smaller GHG emission sources.
This RIA illustrates the burden impacts avoided as a result of this rule. The avoided impacts of
extending these programs for State, local, and tribal permitting authorities are also reported. To
estimate the avoided economic impacts, which include small business impacts, EPA estimated
cost-to-sales ratios by comparing the estimated total annualized compliance cost per permit per
source avoided to industry average revenues per establishment. EPA also evaluated cost-to-sales
ratios by comparing avoided burden costs to revenues of firms at different firm size categories,
recognizing that the sources required to comply with these CAA permit provisions during the
phase-in period are larger emissions sources and more likely to be large business entities.
6.1 Method for Analyzing Avoided Economic and Small Entity Impacts
EPA used cost-to-sales comparisons to evaluate the potential impacts to sources affected
by this rule. Since this regulatory action provides regulatory relief, these cost-to-sales ratios
represent the economic impacts that are avoided or postponed for small GHG sources as a result
of this rule. For all regulatory actions, EPA must determine whether a rule will have a
significant impact on a substantial number of small entities (SISNOSE). This rule provides
regulatory relief to small sources and thus does not have a significant impact on a substantial
number of small entities. The approach for estimating the postponed or avoided economic
impacts and the small entity analysis are the same for this analysis. The steps followed include
gathering data to characterize the affected entities by size, selecting and describing the measures
and economic impact thresholds used in the analysis, and determining cost-to-sales ratios for the
affected industrial, commercial, and residential categories.
6.1.1 Identifying Affected Sectors and Entities
The industrial, commercial, and residential sectors covered by the rule were identified
during the development of the cost analysis for the rule. For the industrial sector, these sources
are summarized with applicable NAICS codes in Tables 6.0 through 6.3. For commercial and
residential sources, the sources are listed in Tables 6.4 through 6.7.
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6.1.2 Data Used to Characterize Affected Entities by Size
The Census Bureau's Statistics of U.S. Businesses (SUSB) data provide national
information on the distribution of economic variables by industry and size.7 Specifically, the
tables report data for each industry on the number of firms (Table 6.0), number of establishments
(Table 6.1), employment (Table 6.2), and receipts (Table 6.3) by enterprise size category in
affected sectors. Similar results are shown for commercial and residential sources in Tables 6.4
through 6.7. The census definitions in these data elements are as follows:
• establishment: An establishment is a single physical location where business is
conducted or where services or industrial operations are performed.
• employment: Paid employment consists of full- and part-time employees, including
salaried officers and executives of corporations, who were on the payroll in the pay
period including March 12. Included are employees on sick leave, holidays, and
vacations; not included are proprietors and partners of unincorporated businesses.
• receipts: Receipts (net of taxes) are defined as the revenue for goods produced,
distributed, or services provided, including revenue earned from premiums,
commissions and fees, rents, interest, dividends, and royalties. Receipts exclude all
revenue collected for local, state, and federal taxes.
• enterprise: An enterprise is a business organization consisting of one or more
domestic establishments that were specified under common ownership or control. The
enterprise and the establishment are the same for single-establishment firms. Each
multiestablishment company forms one enterprise—the enterprise employment and
annual payroll are summed from the associated establishments. Enterprise size
designations are determined by the summed employment of all associated
establishments.8
The SBA small business size standard(s) is provided for each industry group in order to facilitate
comparisons and different thresholds.
The receipt data are reported in 2002 dollars. Therefore, to adjust to 2007 dollars for
comparison to costs, EPA used the U.S. Bureau of Labor Statistics' consumer price index (CPI).
Using the annual U.S. city average price index for all consumer goods, EPA adjusted revenues to
2007 dollars.
7 These data were developed in cooperation with, and partially funded by, the Office of Advocacy of the Small
Business Administration (SBA).
8 Because the SBA's business size definitions (SBA, 2008c) apply to an establishment's "ultimate parent company,"
we assume in this analysis that the "enterprise" definition above is consistent with the concept of ultimate parent
company that is typically used for Small Business Regulatory Enforcement Fairness Act (SBREFA) screening
analyses and the terms are used interchangeably.
54
-------
Table 6.0. Number of Firms by Industry and Enterprise Size: 2002
Sector
Electricity
Generating
Units
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Energy
Energy
Source Category
Electricity Generating Units
Adipic Acid Production
Aluminum Production
Ammonia Manufacturing
Cement Production
Electronics Manufacturing
Ferroalloy Production
Glass Production
HCFC-22 Production
Hydrogen Production
Iron and Steel Production
Lead Production
Lime Manufacturing
Magnesium Production
Nitric Acid Production
Petrochemical Production
Petroleum Refineries
Phosphoric Acid Production
Pulp and Paper Manufacturing
Silicon Carbide Production
Soda Ash Manufacturing
Titanium Dioxide Production
Zinc Production
Ethanol Production
Food Processing
Underground Coal Mines
Oil and Natural Gas Systems
NAICS
22
325199
331312
325311
327310
334
331112
327
325120
325120
331111
3314
327410
3314
325311
3251
324110
325312
3221
327910
325181
325188
3314
325193
311
21211
211
SBA Size
Standard
i
1,000
1,000
1,000
750
2
750
500-1,000
1,000
1,000
1,000
750-1,000
500
750-1,000
1,000
500-1,000
3
500
750
500
1,000
1,000
750-1,000
1,000
500-1,000
500
500
Total
Firms
7,603
443
43
130
136
13,833
14
11,395
87
87
1,135
760
41
760
130
1,145
202
35
338
299
25
367
760
60
21,384
802
6,317
<20
Employees
5,636
157
28
78
67
7,698
3
7,108
45
45
687
384
16
384
78
475
84
12
96
161
10
139
384
19
13,645
387
5,184
20 to 99
Employees
901
95
2
18
21
3,291
NA
2,553
12
12
166
161
10
161
18
111
24
5
55
94
5
92
161
16
3,935
246
354
100 to 499
Employees
288
59
3
6
12
1,149
5
590
8
8
53
74
4
74
6
131
23
6
72
25
2
43
74
3
1,247
67
89
500 to 749
Employees
26
16
1
2
6
150
NA
57
NA
NA
9
14
1
14
2
29
6
1
7
2
NA
11
14
1
147
6
13
750 to 999
Employees
18
3
1
1
3
80
1
51
3
3
12
8
2
8
1
14
3
NA
12
NA
1
6
8
NA
63
6
11
1,000 to
1,499
Employees
19
10
NA
7
4
86
1
32
2
2
11
5
1
5
7
20
3
2
12
NA
1
3
5
3
96
3
5
(continued)
-------
Table 6.0. Number of Firms by Industry and Enterprise Size: 2002 (continued)
Sector
Energy
Waste
Treatment
Waste
Treatment
Source Category
Oil and Natural Gas Systems
Landfills
MWCs
NAICS
486
562
562
SBA Size
Standard
4
$12.5
million
$12.5
million
Total
Firms
244
14,184
14,184
<20
Employees
110
10,726
10,726
20 to 99
Employees
22
1,616
1,616
100 to 499
Employees
16
258
258
500 to 749
Employees
8
22
22
750 to 999
Employees
3
11
11
1,000 to
1,499
Employees
2
15
15
The Census Bureau defines an enterprise as a business organization consisting of one or more domestic establishments that were specified under common
ownership or control. The enterprise and the establishment are the same for single-establishment firms. Each multiestablishment company forms one enterprise—
the enterprise employment and annual payroll are summed from the associated establishments. Enterprise size designations are determined by the summed
employment of all associated establishments.
Since the SBA's business size definitions (http://www.sba.gov/size) apply to an establishment's ultimate parent company, we assume in this analysis that the
enterprise definition above is consistent with the concept of ultimate parent company that is typically used for SBREFA screening analyses. SBA size standards
as of 8/11/08.
1 NAICS codes 221111, 221112, 221113, 221119, 221121, 221122: A firm is small if, including its affiliates, it is primarily engaged in the generation,
transmission, and/or distribution of electric energy for sale and its total electric output for the preceding fiscal year did not exceed 4 million megawatt hours.
2NAICS Subsectors 333, 334, 335 and 336: For rebuilding machinery or equipment on a factory basis, or equivalent, use the NAICS code for a newly
manufactured product. Concerns performing major rebuilding or overhaul activities do not necessarily have to meet the criteria for being a "manufacturer"
although the activities may be classified under a manufacturing NAICS code. Ordinary repair services or preservation are not considered rebuilding.
3 500 to 1,500. For NAICS code 324110: For purposes of Government procurement, the petroleum refiner must be a concern that has 1,500 employees or fewer
or has 125,000 barrels per calendar day or less total Operable Atmospheric Crude Oil Distillation capacity. Capacity includes owned or leased facilities as well as
facilities under a processing agreement or an arrangement such as an exchange agreement or a throughput. The total product to be delivered under the contract
must be at least 90 percent refined by the successful bidder from either crude oil or bona fide feedstocks.
4 Subsector 486: Pipeline Transportation (486110 Pipeline Transportation of Crude Oil 1,500, 486210 Pipeline Transportation of Natural Gas $7.0 million,
486910 Pipeline Transportation of Refined Petroleum Products 1,500, 486990 All Other Pipeline Transportation $34.5 million).
-------
Table 6.1. Number of Establishments by Affected Industry and Enterprise Size: 2002
Sector
Electricity
Generating
Units
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Energy
Source Category
Electricity Generating Units
Adipic Acid Production
Aluminum Production
Ammonia Manufacturing
Cement Production
Electronics Manufacturing
Ferroalloy Production
Glass Production
HCFC-22 Production
Hydrogen Production
Iron and Steel Production
Lead Production
Lime Manufacturing
Magnesium Production
Nitric Acid Production
Petrochemical Production
Petroleum Refineries
Phosphoric Acid Production
Pulp and Paper Manufacturing
Silicon Carbide Production
Soda Ash Manufacturing
Titanium Dioxide Production
Zinc Production
Ethanol Production
Food Processing
Underground Coal Mines
NAICS
22
325199
331312
325311
327310
334
331112
327
325120
325120
331111
3314
327410
3314
325311
3251
324110
325312
3221
327910
325181
325188
3314
325193
311
21211
SBA Size
Standard
i
1,000
1,000
1,000
750
2
750
500-1,000
1,000
1,000
1,000
750-1,000
500
750-1,000
1,000
500-1,000
3
500
750
500
1,000
1,000
750-1,000
1,000
500-1,000
500
Total
Establish-
ments
18,432
640
50
157
253
15,883
17
16,674
551
551
1,242
958
77
958
157
2,287
349
50
628
347
38
611
958
66
25,698
1,194
<20
Employees
5,715
157
28
78
67
7,709
3
7,161
45
45
690
386
18
386
78
478
85
12
97
161
10
141
386
20
13,719
390
20 to 99
Employees
1,423
99
2
18
29
3,435
NA
3,302
20
20
169
174
13
174
18
316
29
5
55
100
5
111
174
16
4,254
279
100 to 499
Employees
1,126
78
4
15
22
1,497
7
1,788
20
20
62
108
6
108
15
231
28
6
88
42
4
69
108
5
1,951
138
500 to 749
Employees
282
24
1
5
11
282
NA
306
NA
NA
9
24
7
24
5
68
10
2
13
2
NA
38
24
1
370
23
750 to 999
Employees
144
4
1
1
9
130
1
438
30
30
19
14
19
14
1
63
7
NA
34
NA
1
25
14
NA
211
20
1,000 to
1,499
Employees
209
17
NA
12
20
174
1
337
55
55
18
11
4
11
12
97
3
2
21
NA
1
6
11
4
319
24
(continued)
-------
Table 6.1. Number of Establishments by Affected Industry and Enterprise Size: 2002 (continued)
Sector
Energy
Energy
Waste
Treatment
Waste
Treatment
Source Category
Oil and Natural Gas Systems
Oil and Natural Gas Systems
Landfills
MWCs
NAICS
211
486
562
562
SBA Size
Standard
500
4
$12.5
million
$12.5
million
Total
Establish-
ments
7,629
2,701
17,698
17,698
<20
Employees
5,239
110
10,775
10,775
20 to 99
Employees
456
59
1,839
1,839
100 to 499
Employees
292
79
612
612
500 to 749
Employees
60
115
86
86
750 to 999
Employees
64
5
63
63
1,000 to
1,499
Employees
31
42
58
58
The Census Bureau defines an enterprise as a business organization consisting of one or more domestic establishments that were specified under common
ownership or control. The enterprise and the establishment are the same for single-establishment firms. Each multiestablishment company forms one
enterprise—the enterprise employment and annual payroll are summed from the associated establishments. Enterprise size designations are determined by the
summed employment of all associated establishments.
Since the SBA's business size definitions (http://www.sba.gov/size) apply to an establishment's ultimate parent company, we assume in this analysis that the
enterprise definition above is consistent with the concept of ultimate parent company that is typically used for SBREFA screening analyses. SBA Small Entity
standards as of 8/11/08.
^ l NAICS codes 221111, 221112, 221113, 221119, 221121, 221122: A firm is small if, including its affiliates, it is primarily engaged in the generation,
oo transmission, and/or distribution of electric energy for sale and its total electric output for the preceding fiscal year did not exceed 4 million megawatt hours.
2 NAICS Subsectors 333, 334, 335 and 336: For rebuilding machinery or equipment on a factory basis, or equivalent, use the NAICS code for a newly
manufactured product. Concerns performing major rebuilding or overhaul activities do not necessarily have to meet the criteria for being a "manufacturer"
although the activities may be classified under a manufacturing NAICS code. Ordinary repair services or preservation are not considered rebuilding.
3 500 to 1,500. For NAICS code 324110: For purposes of Government procurement, the petroleum refiner must be a concern that has 1,500 employees or fewer
and has 125,000 barrels or less per calendar day total Operable Atmospheric Crude Oil Distillation capacity. Capacity includes owned or leased facilities as
well as facilities under a processing agreement or an arrangement such as an exchange agreement or a throughput. The total product to be delivered under the
contract must be at least 90 percent refined by the successful bidder from either crude oil or bona fide feedstocks.
4 Subsector486: Pipeline Transportation (486110 Pipeline Transportation of Crude Oil 1,500, 486210 Pipeline Transportation of Natural Gas $7.0 million,
486910 Pipeline Transportation of Refined Petroleum Products 1,500, 486990 All Other Pipeline Transportation $34.5 million).
-------
Table 6.2. Number of Employees by Affected Industry and Enterprise Size: 2002
Sector
Electricity
Generating
Units
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Energy
Source Category
Electricity Generating Units
Adipic Acid Production
Aluminum Production
Ammonia Manufacturing
Cement Production
Electronics Manufacturing
Ferroalloy Production
Glass Production
HCFC-22 Production
Hydrogen Production
Iron and Steel Production
Lead Production
Lime Manufacturing
Magnesium Production
Nitric Acid Production
Petrochemical Production
Petroleum Refineries
Phosphoric Acid
Pulp and Paper
Silicon Carbide Production
Soda Ash Manufacturing
Titanium Dioxide Production
Zinc Production
Ethanol Production
Food Processing
Underground Coal Mines
NAICS
22
325199
331312
325311
327310
334
331112
327
325120
325120
331111
3314
327410
3314
325311
3251
324110
325312
3221
327910
325181
325188
3314
325193
311
21211
SBA Size
Standard
i
1,000
1,000
1,000
750
2
750
500-1,000
1,000
1,000
1,000
750-1,000
500
750-1,000
1,000
500-1,000
3
500
750
500
1,000
1,000
750-1,000
1,000
500-1,000
500
Total
Establish-
ments
648,254
73,342
10,158
4,949
16,905
1,300,411
2,266
475,476
9,557
9,557
124,703
64,203
4,393
64,203
4,949
172,964
62,132
6,288
162,988
16,079
4,483
49,845
64,203
64,203
1,735
1,443,766
<20
Employees
24,257
1,023
38
363
493
50,279
NA
47,315
88
88
1,434
2,421
33
2,421
363
3,171
454
27
537
1,237
56
566
2,421
2,421
NA
85,850
20 to 99
Employees
39,391
2,412
NA
210
418
139,966
NA
98,637
294
294
6,235
6,680
227
6,680
210
10,392
942
NA
2,279
3,637
NA
881
6,680
6,680
NA
156,158
100 to 499
Employees
46,942
3,232
NA
NA
1,157
186,772
NA
85,569
510
510
3,227
10,407
NA
10,407
NA
16,525
2,870
NA
12,554
3,536
NA
1,839
10,407
10,407
NA
218,041
500 to 749
Employees
12,042
NA
NA
NA
NA
53,138
NA
17,516
NA
NA
1,456
NA
NA
NA
NA
5,548
2,903
NA
2,782
NA
NA
NA
NA
NA
NA
67,104
750 to 999
Employees
6,519
754
NA
NA
NA
33,589
NA
17,946
NA
NA
NA
NA
NA
NA
NA
3,354
NA
NA
7,707
NA
NA
NA
NA
NA
NA
30,099
1,000 to
1,499
Employees
14,653
NA
NA
NA
2,051
43,361
NA
17,512
NA
NA
NA
1,337
NA
1,337
NA
5,001
NA
NA
7,121
NA
NA
NA
1,337
1,337
NA
72,262
(continued)
-------
Table 6.2. Number of Employees by Affected Industry and Enterprise Size: 2002 (continued)
Sector
Energy
Energy
Waste
Treatment
Waste
Treatment
Source Category
Oil and Natural Gas Systems
Oil and Natural Gas Systems
Landfills
MWCs
NAICS
211
486
562
562
SBA Size
Standard
500
4
$12.5
million
$12.5
million
Total
Establish-
ments
74,915
88,280
300,580
300,580
<20
Employees
2,801
19,336
56,529
56,529
20 to 99
Employees
10,205
12,113
59,245
59,245
100 to 499
Employees
11,576
11,656
37,530
37,530
500 to 749
Employees
NA
2,421
5,122
5,122
750 to 999
Employees
1,773
3,551
3,401
3,401
1,000 to
1,499
Employees
NA
1,061
3,645
3,645
The Census Bureau defines an enterprise as a business organization consisting of one or more domestic establishments that were specified under common
ownership or control. The enterprise and the establishment are the same for single-establishment firms. Each multi-establishment company forms one
enterprise—the enterprise employment and annual payroll are summed from the associated establishments. Enterprise size designations are determined by the
summed employment of all associated establishments.
Since the SBA's business size definitions (http://www.sba.gov/size) apply to an establishment's ultimate parent company, we assume in this analysis that the
enterprise definition above is consistent with the concept of ultimate parent company that is typically used for SBREFA screening analyses. SBA small entity
definitions as of 8/11/08.
1 NAICS codes 221111, 221112, 221113, 221119, 221121, 221122: A firm is small if, including its affiliates, it is primarily engaged in the generation,
transmission, and/or distribution of electric energy for sale and its total electric output for the preceding fiscal year did not exceed 4 million megawatt hours.
2 NAICS Subsectors 333, 334, 335 and 336: For rebuilding machinery or equipment on a factory basis, or equivalent, use the NAICS code for a newly
manufactured product. Concerns performing major rebuilding or overhaul activities do not necessarily have to meet the criteria for being a "manufacturer"
although the activities may be classified under a manufacturing NAICS code. Ordinary repair services or preservation are not considered rebuilding.
3 500 to 1,500. For NAICS code 324110: For purposes of Government procurement, the petroleum refiner must be a concern that has 1,500 employees or
fewer or 125,000 barrels or less per calendar day total Operable Atmospheric Crude Oil Distillation capacity. Capacity includes owned or leased facilities as
well as facilities under a processing agreement or an arrangement such as an exchange agreement or a throughput. The total product to be delivered under the
contract must be at least 90 percent refined by the successful bidder from either crude oil or bona fide feedstocks.
4 Subsector486: Pipeline Transportation (486110 Pipeline Transportation of Crude Oil 1,500, 486210 Pipeline Transportation of Natural Gas $7.0 million,
486910 Pipeline Transportation of Refined Petroleum Products 1,500, 486990 All Other Pipeline Transportation $34.5 million).
-------
Table 6.3. Receipts by Industry and Enterprise Size: 2002 (in millions of 2007$)
Sector
Electricity
Generating
Units
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Source Category
Electricity Generating Units
Adipic Acid Production
Aluminum Production
Ammonia Manufacturing
Cement Production
Electronics Manufacturing
Ferroalloy Production
Glass Production
HCFC-22 Production
Hydrogen Production
Iron and Steel Production
Lead Production
Lime Manufacturing
Magnesium Production
Nitric Acid Production
Petrochemical Production
Petroleum Refineries
Phosphoric Acid Production
Pulp and Paper Manufacturing
Silicon Carbide Production
Soda Ash Manufacturing
Titanium Dioxide Production
Zinc Production
Ethanol Production
Food Processing
NAICS
22
325199
331312
325311
327310
334
331112
327
325120
325120
331111
3314
327410
3314
325311
3251
324110
325312
3221
327910
325181
325188
3314
325193
311
SBA Size
Standard
i
1,000
1,000
1,000
750
2
750
500-1,000
1,000
1,000
1,000
750-1,000
500
750-1,000
1,000
500-1,000
3
500
750
500
1,000
1,000
750-1000
1,000
500-1000
Total
Receipts
($)
456,494
54,024
4,165
3,844
8,358
437,886
1,008
110,002
6,662
6,662
54,363
24,584
1,173
24,584
3,844
123,343
225,612
4,607
81,766
3,861
2,386
18,803
24,584
2,416
527,312
<20
Employees
10,324
437
7
152
207
9,887
NA
7,430
25
25
275
582
7
582
152
1,603
538
7
146
206
12
199
582
NA
14,597
20 to 99
Employees
28,259
880
NA
60
120
26,268
NA
17,700
337
337
1,237
2,391
64
2,391
60
4,722
2,903
NA
719
561
NA
267
2,391
NA
37,198
100 to 499
Employees
29,111
2,117
NA
NA
526
41,653
NA
16,967
82
82
1,192
3,007
NA
3,007
NA
7,974
5,186
NA
5,269
715
NA
685
3,007
NA
65,304
500 to 749
Employees
8,522
NA
NA
NA
NA
14,340
NA
4,154
NA
NA
639
NA
NA
NA
NA
3,990
10,094
NA
805
NA
NA
NA
NA
NA
26,627
750 to 999
Employees
5,211
984
NA
NA
NA
8,589
NA
4,000
NA
NA
NA
NA
NA
NA
NA
2,048
NA
NA
3,294
NA
NA
NA
NA
NA
11,533
1,000 to
1,499
Employees
11,027
NA
NA
NA
992
12,994
NA
4,366
NA
NA
NA
364
NA
364
NA
3,819
NA
NA
2,833
NA
NA
NA
364
NA
25,216
(continued)
-------
Table 6.3. Receipts by Industry and Enterprise Size: 2002 (in Millions of 2007$) (continued)
Sector
Energy
Energy
Energy
Waste
Treatment
Waste
Treatment
Source Category
Underground Coal Mines
Oil and Natural Gas Systems
Oil and Natural Gas Systems
Landfills
MWCs
NAICS
21211
211
486
562
562
SBA Size
Standard
500
500
4
$12.5
million
$12.5
million
Total
Receipts
($)
22,873
185,420
51,926
55,557
55,557
<20
Employees
501
8,465
1,163
7,451
7,451
20 to 99
Employees
2,415
7,826
158
8,366
8,366
100 to 499
Employees
3,328
11,075
258
5,940
5,940
500 to 749
Employees
NA
5,312
NA
965
965
750 to 999
Employees
506
4,600
NA
858
858
1,000 to
1,499
Employees
NA
3,233
NA
586
586
to
The Census Bureau defines an enterprise as a business organization consisting of one or more domestic establishments that were specified under common
ownership or control. The enterprise and the establishment are the same for single-establishment firms. Each multi-establishment company forms one
enterprise—the enterprise employment and annual payroll are summed from the associated establishments. Enterprise size designations are determined by the
summed employment of all associated establishments.
Since the SBA's business size definitions (http://www.sba.gov/size) apply to an establishment's ultimate parent company, we assume in this analysis that the
enterprise definition above is consistent with the concept of ultimate parent company that is typically used for SBREFA screening analyses. SBA Small
Business categorization as of 8/11/08.
1 NAICS codes 221111, 221112, 221113, 221119, 221121, 221122: A firm is small if, including its affiliates, it is primarily engaged in the generation,
transmission, and/or distribution of electric energy for sale and its total electric output for the preceding fiscal year did not exceed 4 million megawatt hours.
2 NAICS Subsectors 333, 334, 335 and 336: For rebuilding machinery or equipment on a factory basis, or equivalent, use the NAICS code for a newly
manufactured product. Concerns performing major rebuilding or overhaul activities do not necessarily have to meet the criteria for being a "manufacturer"
although the activities may be classified under a manufacturing NAICS code. Ordinary repair services or preservation are not considered rebuilding.
3 500 to 1,500. For NAICS code 324110: For purposes of Government procurement, the petroleum refiner must be a concern that has 1,500 employees or fewer
and 125,000 barrels or less per calendar day total Operable Atmospheric Crude Oil Distillation capacity. Capacity includes owned or leased facilities as well as
facilities under a processing agreement or an arrangement such as an exchange agreement or a throughput. The total product to be delivered under the contract
must be at least 90 percent refined by the successful bidder from either crude oil or bona fide feedstocks.
4 Subsector486: Pipeline Transportation (486110 Pipeline Transportation of Crude Oil 1,500, 486210 Pipeline Transportation of Natural Gas $7.0 million,
486910 Pipeline Transportation of Refined Petroleum Products 1,500, 486990 All Other Pipeline Transportation $34.5 million)
-------
Table 6.4. Number of Firms by Affected Industry and Enterprise Size in Commercial Sectors: 2002
SBA Size
Standard 1,000 to
in Millions Total <20 20 to 99 100 to 499 500 to 749 750 to 999 1,499
Sector Source Category NAICS of Dollars Firms Employees Employees Employees Employees Employees Employees
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Residential
Education
Enclosed Mall
Food Sales
Food Service
Inpatient Health C are
Laboratory
Laboratory
Lodging
Nonrefrigerated Warehouse
Nursing
Office
Other
Outpatient Health Care
Public Assembly
Public Order and Safety
Refrigerated Warehouse
Religious Worship
Retail Other than Mall
Service
Strip Shopping Mall
Residential
61
531120
722
622
541380
5417
721
49311
623
531120
81
621
71
49312
813110
44-45
81
531120
531110
$7.035.0
7.0
7.020.5
34.5
12.0
7.0
7.0
25.5
7.013.5
7.0
7.025.0
7.034.5
7.0
25.5
7.0
7.029.0
7.025.0
7.0
7.0
65,933
28,241
NA
376,637
4,548
4,708
11,418
51,168
3,152
32,720
28,241
675,218
424,694
103,043
NA
608
172,311
736,130
675,218
28,241
52,190
40,824
22,509
NA
248,494
427
3,335
7,365
33,326
2,005
14,632
22,509
568,285
351,540
64,915
NA
358
147,505
579,905
568,285
22,509
44,477
12,379
1,077
NA
67,549
487
680
1,478
7,968
514
8,486
1,077
41,363
27,991
12,227
NA
138
15,942
59,639
41,363
1,077
1,799
3,071
329
NA
6,629
1,590
148
532
1,428
199
5,836
329
4,449
4,699
2,292
NA
34
1,213
8,723
4,449
329
441
289
43
NA
447
384
22
72
135
15
418
43
290
428
153
NA
3
39
577
290
43
55
174
32
NA
191
237
6
29
70
10
179
32
164
216
82
NA
2
21
289
164
32
29
187
30
NA
223
333
12
39
77
19
174
30
165
238
95
NA
4
19
338
165
30
30
The Census Bureau defines an enterprise as a business organization consisting of one or more domestic establishments that were specified under common
ownership or control. The enterprise and the establishment are the same for single-establishment firms. Each multi-establishment company forms one
enterprise—the enterprise employment and annual payroll are summed from the associated establishments. Enterprise size designations are determined by the
summed employment of all associated establishments.
Since the SBA's business size definitions (http://www.sba.gov/size) apply to an establishment's ultimate parent company, we assume in this analysis that the
enterprise definition above is consistent with the concept of ultimate parent company that is typically used for SBREFA screening analyses. SBA size categories
as of 8/11/08.
-------
Table 6.5. Number of Establishments by Affected Industry and Enterprise Size: 2002
Sector
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Source Category
Education
Enclosed Mall
Food Sales
Food Service
Inpatient Health Care
Laboratory
Laboratory
Lodging
Nonrefrigerated
Warehouse
Nursing
Office
Other
Outpatient Health
Care
Public Assembly
Public Order and
Safety
Refrigerated
Warehouse
Religious Worship
Retail Other than Mall
Service
Strip Shopping Mall
NAICS
61
531120
722
622
541380
5417
721
49311
623
531120
81
621
71
49312
813110
44-45
81
531120
SBA Size
Standard
7.0-35.0
7.0
7.0-20.5
34.5
12.0
7.0
7.0
25.5
7.0-13.5
7.0
7.0-25.0
7.0-34.5
7.0
25.5
7.0
7.0-29.0
7.0-25.0
7.0
Total Firms
73,701
30,777
NA
503,354
7,569
5,962
13,944
61,795
4,893
67,900
30,777
740,118
487,747
110,375
NA
970
172,562
1,125,693
740,118
30,777
<20
Employees
41,136
22,706
NA
249,889
441
3,371
7,462
33,613
2,057
14,824
22,706
573,318
357,221
65,195
NA
367
147,510
594,655
573,318
22,706
20 to 99
Employees
13,925
1,313
NA
79,906
513
972
1,836
9,057
805
11,701
1,313
54,021
41,650
13,408
NA
204
16,009
98,116
54,021
1,313
100 to 499
Employees
5,604
597
NA
31,769
1,725
488
996
2,962
529
18,516
597
16,431
19,182
3,715
NA
96
1,272
51,814
16,431
597
500 to 749
Employees
864
123
NA
7,297
442
67
228
761
311
3,717
123
2,960
3,021
566
NA
20
115
12,028
2,960
123
750 to 999
Employees
398
180
NA
4,524
294
41
112
249
97
1,898
180
1,850
2,087
591
NA
13
25
8,897
1,850
180
1,000 to 1,499
Employees
501
141
NA
6,819
420
195
150
663
87
2,043
141
2,317
1,933
394
NA
36
27
13,004
2,317
141
(continued)
-------
Table 6.5. Number of Establishments by Affected Industry and Enterprise Size: 2002 (continued)
Sector
Residential
Source Category
Residential
NAICS
531110
SBA Size
Standard
7.0
Total Firms
57,748
<20
Employees
45,104
20 to 99
Employees
2,992
100 to 499
Employees
2,491
500 to 749
Employees
479
750 to 999
Employees
132
1,000 to 1,499
Employees
205
The Census Bureau defines an enterprise as a business organization consisting of one or more domestic establishments that were specified under common
ownership or control. The enterprise and the establishment are the same for single-establishment firms. Each multi-establishment company forms one
enterprise—the enterprise employment and annual payroll are summed from the associated establishments. Enterprise size designations are determined by the
summed employment of all associated establishments.
Since the SBA's business size definitions (http://www.sba.gov/size) apply to an establishment's ultimate parent company, we assume in this analysis that the
enterprise definition above is consistent with the concept of ultimate parent company that is typically used for SBREFA screening analyses. SBA small business
categories as of 8/11//08.
-------
Table 6.6. Number of Employees by Affected Industry and Commercial Enterprise Size: 2002
Sector
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Residential
Source Category
Education
Enclosed Mall
Food Sales
Food Service
Inpatient Health Care
Laboratory
Laboratory
Lodging
Nonrefrigerated
Warehouse
Nursing
Office
Other
Outpatient Health Care
Public Assembly
Public Order and Safety
Refrigerated
Warehouse
Religious Worship
Retail Other than Mall
Service
Strip Shopping Mall
Residential
NAICS
61
531120
722
622
541380
5417
721
49311
623
531120
81
621
71
49312
813110
44^5
81
531120
531110
SBA Size
Standard
7.0-35.0
7.0
7.0-20.5
34.5
12.0
7.0
7.0
25.5
7.0-13.5
7.0
7.0-25.0
7.0-34.5
7.0
25.5
7.0
7.0-29.0
7.0-25.0
7.0
7.0
Total
Establish-
ments
2,701,675
163,501
NA
8,352,174
5,121,584
100,797
399,213
1,696,701
94,316
2,770,665
163,501
5,420,087
4,917,156
1,800,991
NA
28,100
1,638,915
14,819,904
5,420,087
163,501
281,250
<20
Employees
223,695
73,311
NA
1,622,740
2,374
18,415
35,669
202,509
11,294
92,274
73,311
2,547,460
1,829,546
315,475
NA
2,238
722,630
2,889,481
2,547,460
73,311
152,350
20 to 99
Employees
516,135
32,364
NA
2,551,714
30,243
25,714
60,951
292,528
18,392
409,004
32,364
1,482,350
1,029,355
496,962
NA
5,427
607,209
2,204,104
1,482,350
32,364
59,796
100 to 499
Employees
535,272
22,319
NA
1,184,119
389,501
19,918
84,936
232,976
21,859
965,200
22,319
640,068
751,711
380,688
NA
5,010
197,037
1,267,733
640,068
22,319
42,104
500 to 749
Employees
148,370
5,066
NA
232,483
220,984
3,920
22,983
56,837
3,802
172,278
5,066
84,297
134,712
65,678
NA
NA
20,211
213,518
84,297
5,066
7,627
750 to 999
Employees
121,656
3,583
NA
134,402
192,908
2,677
9,641
37,156
2,144
91,599
3,583
61,553
89,264
NA
NA
NA
13,453
138,205
61,553
3,583
NA
1,000 to
1,499
Employees
190,930
4,095
NA
216,606
385,312
4,786
15,808
53,296
2,654
132,119
4,095
74,082
107,577
72,282
NA
1,545
14,081
200,867
74,082
4,095
NA
Oi
Oi
The Census Bureau defines an enterprise as a business organization consisting of one or more domestic establishments that were specified under common
ownership or control. The enterprise and the establishment are the same for single-establishment firms. Each multi-establishment company forms one
enterprise—the enterprise employment and annual payroll are summed from the associated establishments. Enterprise size designations are determined by the
summed employment of all associated establishments.
Since the SBA's business size definitions (http://www.sba.gov/size) apply to an establishment's ultimate parent company, we assume in this analysis that the
enterprise definition above is consistent with the concept of ultimate parent company that is typically used for SBREFA screening analyses. SBA small business
sizes as of 8/11/08.
-------
Table 6.7. Receipts by Affected Industry and Enterprise Size: 2002 (Millions of 2007 $)
Sector
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Residential
Source Category
Education
Enclosed Mall
Food Sales
Food Service
Inpatient Health Care
Laboratory
Laboratory
Lodging
Nonrefrigerated
Warehouse
Nursing
Office
Other
Outpatient Health Care
Public Assembly
Public Order and Safety
Refrigerated Warehouse
Religious Worship
Retail Other than Mall
Service
Strip Shopping Mall
Residential
NAICS
61
531120
722
622
541380
5417
721
49311
623
531120
81
621
71
NA
49312
813110
44^5
81
531120
531110
SBA Size
Standard
in Millions
of Dollars
7.0-35.0
7.0
7.0-20.5
34.5
12.0
7.0
7.0
25.5
7.0-13.5
7.0
7.0-25.0
7.0-34.5
7.0
NA
25.5
7.0
7.0-29.0
7.0-25.0
7.0
7.0
Total
Receipts
207,779
52,796
NA
373,666
575,286
11,854
72,013
141,193
10,705
145,529
52,796
491,097
582,829
170,062
NA
4,889
95,558
3,612,583
491,097
52,796
57,365
<20
Employees
15,586
21,467
NA
79,827
845
2,018
6,419
15,159
1,546
4,624
21,467
215,897
229,611
35,446
NA
325
37,076
577,700
215,897
21,467
32,327
20 to 99
Employees
30,849
8,090
NA
98,916
2,892
2,763
10,785
18,413
2,199
18,714
8,090
120,283
118,216
31,146
NA
765
34,178
662,037
120,283
8,090
9,943
100 to 499
Employees
38,207
6,609
NA
49,500
33,554
2,091
15,439
15,047
2,281
49,332
6,609
67,821
73,667
35,130
NA
586
13,933
441,243
67,821
6,609
6,854
500 to 749
Employees
10,456
2,148
NA
9,774
20,075
478
4,422
4,287
508
9,058
2,148
10,225
12,923
6,972
NA
NA
1,681
65,923
10,225
2,148
1,366
750 to 999
Employees
7,620
2,145
NA
5,742
18,448
319
1,942
2,869
286
4,989
2,145
5,946
8,277
NA
NA
NA
1,165
34,570
5,946
2,145
NA
1,000 to
1,499
Employees
11,997
3,281
NA
9,036
41,167
574
2,802
4,431
301
7,319
3,281
5,999
10,556
7,610
NA
233
1,025
49,386
5,999
3,281
NA
The Census Bureau defines an enterprise as a business organization consisting of one or more domestic establishments that were specified under common
ownership or control. The enterprise and the establishment are the same for single-establishment firms. Each multi-establishment company forms one
enterprise—the enterprise employment and annual payroll are summed from the associated establishments. Enterprise size designations are determined by the
summed employment of all associated establishments.
Since the SBA's business size definitions (http://www.sba.gov/size) apply to an establishment's ultimate parent company, we assume in this analysis that the
enterprise definition above is consistent with the concept of ultimate parent company that is typically used for SBREFA screening analyses. SBA small business
sizes as of 8/11.08.
-------
Because the SBA's business size definitions (SBA, 2008c) apply to an establishment's
"ultimate parent company," we assume in this analysis that the "enterprise" definition above is
consistent with the concept of ultimate parent company that is typically used for SBREFA
screening analyses, and the terms are used interchangeably. We also report the SBA size
standard(s) for each industry group to facilitate comparisons and different thresholds.
6.2 Developing Economic and Small Entity Regulatory Relief Impact Measures
We measured the postponed impacts of the rule on small entities in each sector using
methods presented in EPA's Final SBREFA Guidance (EPA, 2006). Because the rule covers a
large number of sectors and primarily covers businesses, the analysis generated a set of sales tests
(represented as cost-to-receipt ratios)9 for NAICS codes associated with the affected sectors.
Although the appropriate SBA size definition should be applied at the parent company
(enterprise) level, data limitations allowed us only to compute and compare ratios for a model
establishment for six enterprise size ranges (i.e., all categories, enterprises with 1 to 20
employees, 20 to 99 employees, 100 to 499 employees, 500 to 999 employees, and 1,000 to 1,499
employees). This approach allowed us to account for differences in establishment receipts
between large and small enterprises and differences in small business definitions across affected
industries. It is also a conservative approach, because an establishment's parent company (the
"enterprise") may have other economic resources that could be used to cover the costs of the
reporting program.
6.3 Implementing the Sales Test to Measure Impacts on Industrial, Commercial, and
Multifamily Residential Sources
To implement the recommended sales test, EPA computed cost-to-sales ratios for affected
sectors at the establishment (or facility) level.10 The ratios examine the ratio of the average
9 The following metrics for other small entity economic impact measures (if applicable) would potentially include
• Small governments (if applicable): "Revenue" test—annualized compliance cost as a percentage of annual
government revenues
• Small nonprofits (if applicable): "Expenditure" test—annualized compliance cost as a percentage of annual
operating expenses
10 Typically, SBREFA impact assessments are conducted at the ultimate parent company level. As noted above, we
assume that Census definition of enterprise is equivalent to ultimate parent company. Theoretically, the
comparison of compliance costs to sales should be conducted at the enterprise level. Because Census only
provides data for typical establishments within various enterprise size categories, EPA chose to compute the
cost-to-sales ratio at the establishment (or facility level). The same ratio could be computed at the enterprise level
by multiplying both the numerator and the denominator by the typical number of establishments per enterprise in
68
-------
establishment's total annualized mandatory reporting costs to the average establishment receipts
for enterprises within several employment categories.11 The average entity costs used to compute
the sales test are the same across all of these enterprise size categories. As a result, the sales test
will overstate the cost-to-receipt ratio for establishments owned by small businesses, because the
reporting costs are likely lower than average entity estimates provided by the engineering cost
analysis.
Cost-to-sales ratios for industrial categories are reported in Tables 6.9 through 6.12.
Table 6.8 shows impacts avoided for small sources of GHG for title V. In Tables 6.9 and 6.10,
impacts avoided for new and modifying PSD sources, respectively, are presented. Table 6.11
shows the avoided costs compared to sales for title V permitting. These ratios are calculated
using data on the average avoided cost of compliance per facility and data on the average sales
per establishment obtained from the Census Bureau. Cost-to-sales or revenue ratios for
commercial and residential categories are reported in Tables 6.12 through 6.14. Table 6.12 shows
impacts avoided for small commercial and residential sources of GHG for title V. Tables 6.13
and 6.14 show impacts avoided for modifying and new PSD commercial and residential sources,
respectively.
The burden avoided per-entity costs of the rule are shown in Table 3.0 for title V. The
avoided burden cost associated with obtaining an operating permit is $46.4 thousand per source
for industrial sources of GHG emissions and approximately $23 thousand for commercial and
residential sources. An avoided cost of $1,677 is estimated for sources requiring title V
permitting revision. For modifying PSD sources, the avoided burden costs with obtaining a
permit is $84.5 thousand per source for industrial sources of GHG emissions and approximately
$59 thousand per source for commercial and residential sources. Finally, for new PSD sources,
the avoided burden costs are the sum of the avoided title V and modifying PSD costs. Thus, the
avoided burden costs are approximately $130.8 thousand per source for new industrial sources of
GHG emissions and approximately $82 thousand per source for new commercial and residential
sources.
the appropriate enterprise size categories. Using the SUSB data on typical establishments means that the cost-to-
sales ratios are identical, whether computed at the establishment level or at the enterprise level.
11 For the one to 20 employee category, we excluded SUSB data for enterprises with zero employees. These
enterprises did not operate the entire year.
69
-------
The cost-to-sales estimates show that the avoided costs for industrial sources typically are
zero up to 1.5 percent of their sales, but they can be as high as 19 percent for certain sources
(e.g., aluminum plants with less than 20 employees). For PSD, the avoided ICR cost-to-sales
ratios range from zero to 2.7 percent for modifying and from zero to 4.2 percent of sales for new
industrial sources. These avoided cost-to-sales ratio for PSD do not consider avoided BACT
costs due to lack of sufficient data currently.
For commercial sources, the average avoided cost to sales ratios range from 0.5 to 4.2
percent for title V. These average avoided cost-to-sales ranges increase for PSD to
approximately from 1.2 to 10.7 percent of their sales or revenues for modifying commercial and
multifamily residential sources and 1.6 to 14.9 for new commercial and residential PSD sources.
6.4 Economic Relief to Permitting Authorities
In this final rule, the thresholds for requiring title V and PSD permits are increased above
statutory CAA levels resulting in millions of potential title V sources and tens of thousands of
new and modifying PSD sources being able to postpone obtaining a permit for a phase-in period
of about 5 years. This action will provide significant regulatory relief to States, local
government, and tribal permitting authorities. The magnitude of permits that would need to be
addressed and the dollar estimate of the additional costs in labor and administrative costs
permitting authorities would otherwise incur if GHG are a regulated pollutant absent this
rulemaking are shown in Tables 3.0 and 3.2 in Section 3.
For title V permits, permitting authorities will experience avoided costs of approximately
$21 billion relating to approximately 2 million new operating permits annually that otherwise
would need to be processed. Although this administrative burden represents a huge burden to
these agencies, Part 70 of the CAA does provide for a mechanism for the affected permitting
authorities to recoup the costs of operation associated with administering this expanded permit
program. EPA recognizes in this tailoring rule that the sheer magnitude and burden of these
additional small GHG sources cannot feasibly be met by these permitting authorities on
administrative burden grounds for a period of at least 5 years regardless of the ability to include
these increased costs in fees charged to sources. However, the economic consequences to
permitting authorities of this permitting program are offset in the fee structure these authorities
are allowed to charge sources obtaining title V permits.
70
-------
For PSD permitting authorities, no such mitigating fee structure currently exists. Thus,
the funding for administering a PSD permitting program to include tens of thousands of
additional new and modifying PSD sources annually would need to be met by these permitting
authorities from current revenue sources. At present, there are approximately 58 State, local, and
tribal PSD permitting programs operating in the United States and approximately 49 additional
State, local, or tribal government authorities that are administering federal programs under
delegation from EPA. It is difficult to estimate the economic consequences of the regulatory
relief afforded to the individual permitting authorities, because the number of PSD permits
processed each year varies by permitting authority over time depending on the number of new
and modifying sources occurring in a given location. However, the National Association of
Clean Air Agencies (NACAA) has, through a member survey, broadly assessed the additional
resource and burden considerations of EPA treating GHG as a regulated pollutant. NACAA
provided this information to EPA to help improve our understanding of agencies' burdens.12
Under the current PSD program requirements, these permitting authorities process an average of
8 PSD permits for new and modifying sources each year (range of 0 to 56 for individual
respondents). These surveyed permitting authorities indicate they would need an average of 12
new full-time employees (range of 1 to 63) costing an average of $1.1 million annually (range
$60 thousand to $6.3 million) with a 10-fold increase in permits occurring as a result of
including GHG as a regulated pollutant. Some of these permitting authorities indicated that
hiring new employees is not possible at this time because of budget constraints and hiring
freezes. All respondents indicated that new training would be needed to address GHG
permitting. Rather than the 10-fold increase in permits postulated in NACAA's survey, EPA
estimates the increase would more likely be 100-fold making these estimates a significant
understatement of the potential impacts on permitting authorities. For more information about
the sources affected by alternative thresholds and currently covered by title V and PSD, see
Attachments B and C.
12 Memorandum from Mary Stewart Douglas NACAA, to Juan E. Santiago, Group Leader, Operating Permits
Group, U.S. EPA OAQPS. September 3, 2009.
71
-------
Table 6.8. Avoided Title V Costs to Sales for Small Industrial Sources of GHG Emissions
Sector
Electricity
Generating
Units
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Source Category
Electricity Generating
Units
Adipic Acid
Production
Aluminum
Production
Ammonia
Manufacturing
Cement Production
Electronics
Manufacturing
Ferroalloy
Production
Glass Production
HCFC-22 Production
Hydrogen Production
Iron and Steel
Production
Lead Production
Lime Manufacturing
Magnesium
Production
Nitric Acid
Production
Petrochemical
Production
Petroleum Refineries
Phosphoric Acid
Production
Pulp and Paper
Manufacturing
NAICS
22
325199
331312
325311
327310
334
331112
327
325120
325120
331111
3314
327410
3314
325311
3251
324110
325312
3221
SBA Size
Standard
i
1,000
1,000
1,000
750
750
500-1,000
1,000
1,000
1,000
750-1,000
500
750-1,000
1,000
500-1,000
3
500
750
Average
Cost Per
Entity
(2007$)
$46,350
$46,350
$46,350
$46,350
$46,350
$46,350
$46,350
$46,350
$46,350
$46,350
$46350
$46,350
$46,350
$46,350
$46,350
$46,350
$46,350
$46,350
$46,350
Cost per entity
for All
Establishments
(%)
0.2%
0.1%
0.1%
0.2%
0.1%
0.2%
0.1%
0.7%
0.4%
0.4%
0.1%
0.2%
0.3%
0.2%
0.2%
0.1%
0.0%
0.1%
0.0%
Cost per
Entity for
<20
Employees
(%)
2.6%
1.7%
19.0%
2.4%
1.5%
3.6%
NA
4.5%
8.3%
8.3%
11.6%
3.1%
12.8%
3.1%
2.4%
1.4%
0.7%
7.8%
3.1%
Cost per
Entity for
20 to 99
Employees
(%)
0.2%
0.5%
NA
1.4%
1.1%
0.6%
NA
0.9%
0.3%
0.3%
0.6%
0.3%
0.9%
0.3%
1.4%
0.3%
0.0%
NA
0.4%
Cost per
Entity 100
to 499
Employees
(%)
0.2%
0.2%
NA
NA
0.2%
0.2%
NA
0.5%
1.1%
1.1%
0.2%
0.2%
NA
0.2%
NA
0.1%
0.0%
NA
0.1%
Cost per
Entity for
500 to 749
Employees
(%)
0.2%
NA
NA
NA
NA
0.1%
NA
0.3%
NA
NA
0.1%
NA
NA
NA
NA
0.1%
0.0%
NA
0.1%
Cost per
Entity for
750 to 999
Employees
(%)
0.1%
0.0%
NA
NA
NA
0.1%
NA
0.5%
NA
NA
NA
NA
NA
NA
NA
0.1%
NA
NA
0.0%
Cost per
Entity for
1,000 to
1,499
Employees
(%)
0.1%
NA
NA
NA
0.1%
0.1%
NA
0.4%
NA
NA
NA
0.1%
NA
0.1%
NA
0.1%
NA
NA
0.0%
to
(continued)
-------
Table 6.8. Avoided Title V Costs to Sales for Small Industrial Sources of GHG Emissions (continued)
Sector
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Energy
Energy
Energy
Waste
Treatment
Waste
Treatment
Source Category
Silicon Carbide
Production
Soda Ash
Manufacturing
Titanium Dioxide
Production
Zinc Production
Ethanol Production
Food Processing
Underground Coal
Mines
Oil and Natural Gas
Systems
Oil and Natural Gas
Systems
Landfills
MWCs
NAICS
327910
325181
325188
3314
325193
311
21211
211
486
562
562
SBA Size
Standard
500
1,000
1,000
750-1,000
1,000
500-1,000
500
500
4
$12.5
million
$12.5
million
Average
Cost Per
Entity
(2007$)
$46,350
$46,350
$46,350
$46,350
$46,350
$46,350
$46,350
$46,350
$46,350
$46,350
$46,350
Cost per entity
for All
Establishments
(%)
0.4%
0.1%
0.2%
0.2%
0.1%
0.2%
0.2%
0.2%
0.2%
1.5%
1.5%
Cost per
Entity for
<20
Employees
(%)
3.6%
3.8%
3.3%
3.1%
NA
4.4%
3.6%
2.9%
0.4%
6.7%
6.7%
Cost per
Entity for
20 to 99
Employees
(%)
0.8%
NA
1.9%
0.3%
NA
0.5%
0.5%
0.3%
1.7%
1.0%
1.0%
Cost per
Entity 100
to 499
Employees
(%)
0.3%
NA
0.5%
0.2%
NA
0.1%
0.2%
0.1%
1.4%
0.5%
0.5%
Cost per
Entity for
500 to 749
Employees
(%)
NA
NA
NA
NA
NA
0.1%
NA
0.1%
NA
0.4%
0.4%
Cost per
Entity for
750 to 999
Employees
(%)
NA
NA
NA
NA
NA
0.1%
0.2%
0.1%
NA
0.3%
0.3%
Cost per
Entity for
1,000 to
1,499
Employees
(%)
NA
NA
NA
0.1%
NA
0.1%
NA
0.0%
NA
0.5%
0.5%
Since the SBA's business size definitions (http://www.sba.gov/size) apply to an establishment's ultimate parent company, we assume in this analysis that the
enterprise definition above is consistent with the concept of ultimate parent company that is typically used for Small Business Regulatory Enforcement Fairness
Act (SBREFA) screening analyses.
1 NAICS codes 221111, 221112, 221113, 221119, 221121, 221122 - A firm is small if, including its affiliates, it is primarily engaged in the generation,
transmission, and/or distribution of electric energy for sale and its total electric output for the preceding fiscal year did not exceed 4 million megawatt hours.
2 500 to 1,500. For NAICS code 324110: For purposes of Government procurement, the petroleum refiner must be a concern that has no more than 1,500
employees nor production greater than 125,000 barrels per calendar day total Operable Atmospheric Crude Oil Distillation capacity. Capacity includes owned or
leased facilities as well as facilities under a processing agreement or an arrangement such as an exchange agreement or a throughput. The total product to be
delivered under the contract must be at least 90 percent refined by the successful bidder from either crude oil or bona fide feedstocks.
3 NAICS Subsectors 333, 334, 335 and 336: For rebuilding machinery or equipment on a factory basis, or equivalent, use the NAICS code for a newly
manufactured product. Concerns performing major rebuilding or overhaul activities do not necessarily have to meet the criteria for being a "manufacturer"
although the activities may be classified under a manufacturing NAICS code. Ordinary repair services or preservation are not considered rebuilding.
4 Subsector 486: Pipeline Transportation (486110 Pipeline Transportation of Crude Oil 1,500, 486210 Pipeline Transportation of Natural Gas $7.0 million, 486910
Pipeline Transportation of Refined Petroleum Products 1,500, 486990 All Other Pipeline Transportation $34.5 million)
-------
Table 6.9. Avoided Costs to Sales for Small Modifying Industrial GHG PSD Emission Sources
Sector
Electricity
Generating
Units
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Source Category
Electricity Generating
Units
Adipic Acid
Production
Aluminum Production
Ammonia
Manufacturing
Cement Production
Electronics
Manufacturing
Ferroalloy Production
Glass Production
HCFC-22 Production
Hydrogen Production
Iron and Steel
Production
Lead Production
Lime Manufacturing
Magnesium
Production
Nitric Acid Production
Petrochemical
Production
Petroleum Refineries
Phosphoric Acid
Production
Pulp and Paper
Manufacturing
Silicon Carbide
Production
Soda Ash
Manufacturing
NAICS
22
325199
331312
325311
327310
334
331112
327
325120
325120
331111
3314
327410
3314
325311
3251
324110
325312
3221
327910
325181
SBA Size
Standard
(effective
August 11,
2008)
i
1,000
1,000
1,000
750
2
750
500-1,000
1,000
1,000
1,000
750-1,000
500
750-1,000
1,000
500-1,000
3
500
750
500
1,000
Average
Cost Per
Entity
(2007$)
$84,530
$84,530
$84,530
$84,530
$84,530
$84,530
$84,530
$84,530
$84,530
$84,530
$84,530
$84,530
$84,530
$84,530
$84,530
$84,530
$84,530
$84,530
$84,530
$84,530
$84,530
Cost per
Entity for
All
Establish-
ments (%)
0.3%
0.1%
0.1%
0.3%
0.3%
0.3%
0.1%
1.3%
0.7%
0.7%
0.2%
0.3%
0.6%
0.3%
0.3%
0.2%
0.0%
0.1%
0.1%
0.8%
0.1%
Cost per
Entity for
<20
Employees
(%)
4.7%
3.0%
34.6%
4.3%
2.7%
6.6%
NA
8.1%
15.1%
15.1%
21.2%
5.6%
23.3%
5.6%
4.3%
2.5%
1.3%
14.2%
5.6%
6.6%
6.9%
Cost per
Entity for
20 to 99
Employees
(%)
0.4%
1.0%
NA
2.5%
2.0%
1.1%
NA
1.6%
0.5%
0.5%
1.2%
0.6%
1.7%
0.6%
2.5%
0.6%
0.1%
NA
0.6%
1.5%
NA
Cost per
Entity 100
to 499
Employees
(%)
0.3%
0.3%
NA
NA
0.4%
0.3%
NA
0.9%
2.1%
2.1%
0.4%
0.3%
NA
0.3%
NA
0.2%
0.0%
NA
0.1%
0.5%
NA
Cost per
Entity for
500 to 749
Employees
(%)
0.3%
NA
NA
NA
NA
0.2%
NA
0.6%
NA
NA
0.1%
NA
NA
NA
NA
0.1%
0.0%
NA
0.1%
NA
NA
Cost per
Entity for
750 to 999
Employees
(%)
0.2%
0.0%
NA
NA
NA
0.1%
NA
0.9%
NA
NA
NA
NA
NA
NA
NA
0.3%
NA
NA
0.1%
NA
NA
Cost per
Entity for
1,000 to
1,499
Employees
(%)
0.2%
NA
NA
NA
0.2%
0.1%
NA
0.7%
NA
NA
NA
NA
0.3%
NA
0.3%
NA
NA
NA
0.1%
NA
NA
(continued)
-------
Table 6.9. Avoided Costs to Sales for Small Modifying Industrial GHG PSD Emission Sources (continued)
Sector
Industrial
Industrial
Industrial
Industrial
Energy
Energy
Energy
Waste
Treatment
Waste
Treatment
Source Category
Titanium Dioxide
Production
Zinc Production
Ethanol Production
Food Processing
Underground Coal
Mines
Oil and Natural Gas
Systems
Oil and Natural Gas
Systems
Landfills
MWCs
NAICS
325188
3314
325193
311
21211
211
486
562
562
SBA Size
Standard
(effective
August 11,
2008)
1,000
750-1,000
1,000
500-1,000
500
500
4
$12.5
million
$12.5
million
Average
Cost Per
Entity
(2007$)
$84,530
$84,530
$84,530
$84,530
$84,530
$84,530
$84,530
$84,530
$84,530
Cost per
Entity for
All
Establish-
ments (%)
0.3%
0.3%
0.2%
0.4%
0.4%
0.3%
0.4%
2.7%
2.7%
Cost per
Entity for
<20
Employees
(%)
6.0%
5.6%
NA
7.9%
6.6%
5.2%
0.8%
12.2%
12.2%
Cost per
Entity for
20 to 99
Employees
(%)
3.5%
0.6%
NA
1.0%
1.0%
0.5%
3.2%
1.9%
1.9%
Cost per
Entity 100
to 499
Employees
(%)
0.9%
0.3%
NA
0.3%
0.4%
0.2%
2.6%
0.9%
0.9%
Cost per
Entity for
500 to 749
Employees
(%)
NA
NA
NA
0.1%
NA
0.1%
NA
0.8%
0.8%
Cost per
Entity for
750 to 999
Employees
(%)
NA
NA
NA
0.2%
0.3%
0.1%
NA
0.6%
0.6%
Cost per
Entity for
1,000 to
1,499
Employees
(%)
NA
0.3%
NA
0.1%
NA
0.1%
NA
0.8%
0.8%
Since the SBA's business size definitions (http://www.sba.gov/size) apply to an establishment's ultimate parent company, we assume in this analysis that the
enterprise definition above is consistent with the concept of ultimate parent company that is typically used for Small Business Regulatory Enforcement Fairness
Act (SBREFA) screening analyses.
1 NAICS codes 221111, 221112, 221113, 221119, 221121, 221122 - A firm is small if, including its affiliates, it is primarily engaged in the generation,
transmission, and/or distribution of electric energy for sale and its total electric output for the preceding fiscal year did not exceed 4 million megawatt hours.
2 500 to 1,500. For NAICS code 324110: For purposes of Government procurement, the petroleum refiner must be a concern that has no more than 1,500
employees nor production greater than 125,000 barrels per calendar day total Operable Atmospheric Crude Oil Distillation capacity. Capacity includes owned or
leased facilities as well as facilities under a processing agreement or an arrangement such as an exchange agreement or a throughput. The total product to be
delivered under the contract must be at least 90 percent refined by the successful bidder from either crude oil or bona fide feedstocks.
3 NAICS Subsectors 333, 334, 335 and 336: For rebuilding machinery or equipment on a factory basis, or equivalent, use the NAICS code for a newly
manufactured product. Concerns performing major rebuilding or overhaul activities do not necessarily have to meet the criteria for being a "manufacturer"
although the activities may be classified under a manufacturing NAICS code. Ordinary repair services or preservation are not considered rebuilding.
4 Subsector 486: Pipeline Transportation (486110 Pipeline Transportation of Crude Oil 1,500, 486210 Pipeline Transportation of Natural Gas $7.0 million, 486910
Pipeline Transportation of Refined Petroleum Products 1,500, 486990 All Other Pipeline Transportation $34.5 million)
-------
Table 6.10. Avoided Costs to Sales for Small New PSD Industrial GHG Sources
Sector
Electricity
Generating
Units
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Source Category
Electricity Generating
Units
Adipic Acid Production
Aluminum Production
Ammonia
Manufacturing
Cement Production
Electronics
Manufacturing
Ferroalloy Production
Glass Production
HCFC-22 Production
Hydrogen Production
Iron and Steel
Production
Lead Production
Lime Manufacturing
Magnesium Production
Nitric Acid Production
Petrochemical
Production
Petroleum Refineries
Phosphoric Acid
Production
Pulp and Paper
Manufacturing
Silicon Carbide
Production
Soda Ash
Manufacturing
Titanium Dioxide
Production
Zinc Production
NAICS
22
325199
331312
325311
327310
334
331112
327
325120
325120
331111
3314
327410
3314
325311
3251
324110
325312
3221
327910
325181
325188
3314
SBA Size
Standard
(effective
August 11,
2008)
i
1,000
1,000
1,000
750
750
500-1,000
1,000
1,000
1,000
750-1,000
500
750-1,000
1,000
500-1,000
3
500
750
500
1,000
1,000
750-1,000
Average
Cost per
Entity
(2007$)
$130,880
$130,880
$130,880
$130,880
$130,880
$130,880
$130,880
$130,880
$130,880
$130,880
$130,880
$130,880
$130,880
$130,880
$130,880
$130,880
$130,880
$130,880
$130,880
$130,880
$130,880
$130,880
$130,880
Cost per
Entity for
All
Enterprises
0.5%
0.2%
0.2%
0.5%
0.4%
0.5%
0.2%
2.0%
1.1%
1.1%
0.3%
0.5%
0.9%
0.5%
0.5%
0.2%
0.0%
0.1%
0.1%
1.2%
0.2%
0.4%
0.5%
Cost per
Entity for
<20
Employees
7.2%
4.7%
53.6%
6.7%
4.2%
10.2%
NA
12.6%
23.3%
23.3%
32.9%
8.7%
36.1%
8.7%
6.7%
3.9%
2.1%
22.0%
8.7%
10.2%
10.7%
9.3%
8.7%
Cost per
Entity for
20 to 99
Employees
0.7%
1.5%
NA
3.9%
3.2%
1.7%
NA
2.4%
0.8%
0.8%
1.8%
1.0%
2.7%
1.0%
3.9%
0.9%
0.1%
NA
1.0%
2.3%
NA
5.4%
1.0%
Cost per
Entity 100
to 499
Employees
0.5%
0.5%
NA
NA
0.5%
0.5%
NA
1.4%
3.2%
3.2%
0.7%
0.5%
NA
0.5%
NA
0.4%
0.1%
NA
0.2%
0.8%
NA
1.3%
0.5%
Cost per
Entity for
500 to 749
Employees
0.4%
NA
NA
NA
NA
0.3%
NA
1.0%
NA
NA
0.2%
NA
NA
NA
NA
0.2%
0.0%
NA
0.2%
NA
NA
NA
NA
Cost per
Entity for
750 to 999
Employees
0.4%
0.1%
NA
NA
NA
0.2%
NA
1.4%
NA
NA
NA
NA
NA
NA
NA
0.4%
NA
NA
0.1%
NA
NA
NA
NA
Cost per
Entity for
1,000 to
1,499
Employees
0.2%
NA
NA
NA
0.3%
0.2%
NA
1.0%
NA
NA
NA
0.4%
NA
0.4%
NA
0.3%
NA
NA
0.1%
NA
NA
NA
0.4%
(continued)
-------
Table 6.10. Avoided Costs to Sales for Small New PSD Industrial GHG Sources (continued)
Sector
Industrial
Industrial
Energy
Energy
Energy
Waste
Treatment
Waste
Treatment
Source Category
Ethanol Production
Food Processing
Underground Coal
Mines
Oil and Natural Gas
Systems
Oil and Natural Gas
Systems
Landfills
MWCs
NAICS
325193
311
21211
211
486
562
562
SBA Size
Standard
(effective
August 11,
2008)
1,000
500-1,000
500
500
4
$12.5
million
$12.5
million
Average
Cost per
Entity
(2007$)
$130,880
$130,880
$130,880
$130,880
$130,880
$130,880
$130,880
Cost per
Entity for
All
Enterprises
0.4%
0.6%
0.7%
0.5%
0.7%
4.2%
4.2%
Cost per
Entity for
<20
Employees
NA
12.3%
10.2%
8.1%
1.2%
18.9%
18.9%
Cost per
Entity for
20 to 99
Employees
NA
1.5%
1.5%
0.8%
4.9%
2.9%
2.9%
Cost per
Entity 100
to 499
Employees
NA
0.4%
0.5%
0.3%
4.0%
1.3%
1.3%
Cost per
Entity for
500 to 749
Employees
NA
0.2%
NA
0.1%
NA
1.2%
1.2%
Cost per
Entity for
750 to 999
Employees
NA
0.2%
0.5%
0.2%
NA
1.0%
1.0%
Cost per
Entity for
1,000 to
1,499
Employees
NA
0.2%
NA
0.1%
NA
1.3%
1.3%
Since the SBA's business size definitions (http://www.sba.gov/size) apply to an establishment's ultimate parent company, we assume in this analysis that the
enterprise definition above is consistent with the concept of ultimate parent company that is typically used for Small Business Regulatory Enforcement Fairness
Act (SBREFA) screening analyses.
1 NAICS codes 221111, 221112, 221113, 221119, 221121, 221122 - A firm is small if, including its affiliates, it is primarily engaged in the generation,
transmission, and/or distribution of electric energy for sale and its total electric output for the preceding fiscal year did not exceed 4 million megawatt hours.
2 500 to 1,500. For NAICS code 324110: For purposes of Government procurement, the petroleum refiner must be a concern that has no more than 1,500
employees nor production greater than 125,000 barrels per calendar day total Operable Atmospheric Crude Oil Distillation capacity. Capacity includes owned or
leased facilities as well as facilities under a processing agreement or an arrangement such as an exchange agreement or a throughput. The total product to be
delivered under the contract must be at least 90 percent refined by the successful bidder from either crude oil or bona fide feedstocks.
3 NAICS Subsectors 333, 334, 335 and 336: For rebuilding machinery or equipment on a factory basis, or equivalent, use the NAICS code for a newly
manufactured product. Concerns performing major rebuilding or overhaul activities do not necessarily have to meet the criteria for being a "manufacturer"
although the activities may be classified under a manufacturing NAICS code. Ordinary repair services or preservation are not considered rebuilding.
4 Subsector 486: Pipeline Transportation (486110 Pipeline Transportation of Crude Oil 1,500, 486210 Pipeline Transportation of Natural Gas $7.0 million, 486910
Pipeline Transportation of Refined Petroleum Products 1,500, 486990 All Other Pipeline Transportation $34.5 million)
-------
Table 6-11. Avoided Title V Permitting Costs to Sales for Permit Revisions Due to GHG
Sector
Electricity
Generating
Unites
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Source Category
Electricity Generating
Units
Adipic Acid
Production
Aluminum Production
Ammonia
Manufacturing
Cement Production
Electronics
Manufacturing
Ferroalloy Production
Glass Production
HCFC-22 Production
Hydrogen Production
Iron and Steel
Production
Lead Production
Lime Manufacturing
Magnesium
Production
Nitric Acid Production
Petrochemical
Production
Petroleum Refineries
NAICS
22
325199
331312
325311
327310
334
331112
327
325120
325120
331111
3314
327410
3314
325311
3251
324110
SBA Size
Standard
(effective
August 11,
2008)
i
1,000
1,000
1,000
750
2
750
500-1,000
1,000
1,000
1,000
750-1,000
500
750-1,000
1,000
500-1,000
3
Average Cost
Per Entity
(2007S/entity)
$1,677
$1,677
$1,677
$1,677
$1,677
$1,677
$1,677
$1,677
$1,677
$1,677
$1,677
$1,677
$1,677
$1,677
$1,677
$1,677
$1,677
Cost per
Entity for
All
Enterprises
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
Cost per
Entity for
Size
<20
Employees
0.1%
0.1%
0.7%
0.1%
0.1%
0.1%
NA
0.2%
0.3%
0.3%
0.4%
0.1%
0.5%
0.1%
0.1%
0.0%
0.0%
Cost per
Entity for
Size
20 to 99
Employees
0.0%
0.0%
NA
0.1%
0.0%
0.0%
NA
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.1%
0.0%
0.0%
Cost per
Entity for
Size
100 to 499
Employees
0.0%
0.0%
NA
NA
0.0%
0.0%
NA
0.0%
0.0%
0.0%
0.0%
0.0%
NA
0.0%
NA
0.0%
0.0%
Cost per
Entity for
Size
500 to 749
Employees
0.0%
NA
NA
NA
NA
0.0%
NA
0.0%
NA
NA
0.0%
NA
NA
NA
NA
0.0%
0.0%
Cost per
Entity for
Size
750 to 999
Employees
0.0%
0.0%
NA
NA
NA
0.0%
NA
0.0%
NA
NA
NA
NA
NA
NA
NA
0.0%
NA
Cost per
Entity For
Size
1,000 to 1,499
Employees
0.0%
NA
NA
NA
0.0%
0.0%
NA
0.0%
NA
NA
NA
0.0%
NA
0.0%
NA
0.0%
NA
oo
(continued)
-------
Table 6.11. Avoided Title V Permitting Costs to Sales for Permit Revisions Due to GHG (continued)
Sector
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Industrial
Energy
Energy
Energy
Waste
Treatment
Source Category
Phosphoric Acid
Production
Pulp and Paper
Manufacturing
Silicon Carbide
Production
Soda Ash
Manufacturing
Titanium Dioxide
Production
Zinc Production
Ethanol Production
Food Processing
Underground Coal
Mines
Oil and Natural Gas
Systems
Oil and Natural Gas
Systems
Landfills
NAICS
325312
3221
327910
325181
325188
3314
325193
311
21211
211
486
562
SBA Size
Standard
(effective
August 11,
2008)
500
750
500
1,000
1,000
750-1,000
1,000
500-1,000
500
500
4
$12.5
million
Average Cost
Per Entity
(2007S/entity)
$1,677
$1,667
$1,677
$1,677
$1,677
$1,677
$1,677
$1,677
$1,677
$1,677
$1,677
$1,677
Cost per
Entity for
All
Enterprises
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.1%
Cost per
Entity for
Size
<20
Employees
0.3%
0.1%
0.1%
0.1%
0.1%
0.1%
NA
0.2%
0.1%
0.1%
0.0%
0.2%
Cost per
Entity for
Size
20 to 99
Employees
NA
0.0%
0.0%
NA
0.1%
0.0%
NA
0.0%
0.0%
0.0%
0.1%
0.0%
Cost per
Entity for
Size
100 to 499
Employees
NA
0.0%
0.0%
NA
0.0%
0.0%
NA
0.0%
0.0%
0.0%
0.1%
0.0%
Cost per
Entity for
Size
500 to 749
Employees
NA
0.0%
NA
NA
NA
NA
NA
0.0%
NA
0.0%
NA
0.0%
Cost per
Entity for
Size
750 to 999
Employees
NA
0.0%
NA
NA
NA
NA
NA
0.0%
0.0%
0.0%
NA
0.0%
Cost per
Entity For
Size
1,000 to 1,499
Employees
NA
0.0%
NA
NA
NA
0.0%
NA
0.0%
NA
0.0%
NA
0.0%
VO
(continued)
-------
Table 6.11. Avoided Title V Permitting Costs to Sales for Permit Revisions Due to GHG (continued)
Sector
Waste
Treatment
Source Category
MWCs
NAICS
562
SBA Size
Standard
(effective
August 11,
2008)
$12.5
million
Average Cost
Per Entity
(2007S/entity)
$1,677
Cost per
Entity for
All
Enterprises
0.1%
Cost per
Entity for
Size
<20
Employees
0.2%
Cost per
Entity for
Size
20 to 99
Employees
0.0%
Cost per
Entity for
Size
100 to 499
Employees
0.0%
Cost per
Entity for
Size
500 to 749
Employees
0.0%
Cost per
Entity for
Size
750 to 999
Employees
0.0%
Cost per
Entity For
Size
1,000 to 1,499
Employees
0.0%
oo
o
Since the SBA's business size definitions (http://www.sba.gov/size) apply to an establishment's ultimate parent company, we assume in this analysis that the
enterprise definition above is consistent with the concept of ultimate parent company that is typically used for Small Business Regulatory Enforcement Fairness
Act (SBREFA) screening analyses.
1 NAICS codes 221111, 221112, 221113, 221119, 221121, 221122 - A firm is small if, including its affiliates, it is primarily engaged in the generation,
transmission, and/or distribution of electric energy for sale and its total electric output for the preceding fiscal year did not exceed 4 million megawatt hours.
2 500 to 1,500. For NAICS code 324110: For purposes of Government procurement, the petroleum refiner must be a concern that has no more than 1,500
employees nor production greater than 125,000 barrels per calendar day total Operable Atmospheric Crude Oil Distillation capacity. Capacity includes owned or
leased facilities as well as facilities under a processing agreement or an arrangement such as an exchange agreement or a throughput. The total product to be
delivered under the contract must be at least 90 percent refined by the successful bidder from either crude oil or bona fide feedstocks.
3 NAICS Subsectors 333, 334, 335 and 336: For rebuilding machinery or equipment on a factory basis, or equivalent, use the NAICS code for a newly
manufactured product. Concerns performing major rebuilding or overhaul activities do not necessarily have to meet the criteria for being a "manufacturer"
although the activities may be classified under a manufacturing NAICS code. Ordinary repair services or preservation are not considered rebuilding.
4 Subsector 486: Pipeline Transportation (486110 Pipeline Transportation of Crude Oil 1,500, 486210 Pipeline Transportation of Natural Gas $7.0 million, 486910
Pipeline Transportation of Refined Petroleum Products 1,500, 486990 All Other Pipeline Transportation $34.5 million)
-------
Table 6.12. Title V Avoided Costs for Small New Commercial Sources of GHG Emissions Compared to Annual Sales Revenue
Sector
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Source Category
Education
Enclosed Mall
Food Sales
Food Service
Inpatient Health Care
Laboratory
Laboratory
Lodging
Nonrefrigerated
Warehouse
Nursing
Office
Other
Outpatient Health Care
Public Assembly
Public Order and
Safety
Refrigerated
Warehouse
Religious Worship
Retail Other than Mall
Service
Strip Shopping Mall
NAICS
61
531120
722
622
541380
5417
721
49311
623
531120
81
621
71
49312
813110
44^5
81
531120
SBA Size
Standard
(effective
August 11,
2008)
7.0-35.0
7
7.0-20.5
34.5
12
7
7
25.5
7.0-13.5
7
7.0-25.0
7.0-34.5
7
25.5
7
7.0-29.0
7.0-25.0
7
Average Cost
Per Entity
(Sl,000/entity)
$23,175
$23,175
$23,175
$23,175
$23,175
$23,175
$23,175
$23,175
$23,175
$23,175
$23,175
$23,175
$23,175
$23,175
$23,175
$23,175
$23,175
$23,175
$23,175
$23,175
Avoided
Cost to
Average
Sales
Revenues
for All
Enterprises
0.82%
1.35%
NA
3.12%
0.03%
1.17%
0.45%
1.01%
1.06%
1.08%
1.35%
3.49%
1.94%
1.50%
NA
0.46%
4.19%
0.72%
3.49%
1.35%
Avoided
Cost to
Sales
Revenues
Size <20
Employees
6.12%
2.45%
NA
7.25%
1.21%
3.87%
2.69%
5.14%
3.08%
7.43%
2.45%
6.15%
3.61%
4.26%
NA
2.62%
9.22%
2.39%
6.15%
2.45%
Avoided
Cost to
Sales
Revenues
Size
20 to 99
Employees
1.05%
0.38%
NA
1.87%
0.41%
0.82%
0.39%
1.14%
0.85%
1.45%
0.38%
1.04%
0.82%
1.00%
NA
0.62%
1.09%
0.34%
1.04%
0.38%
Avoided
Cost to
Sales
Revenues
Size
100 to 499
Employees
0.34%
0.21%
NA
1.49%
0.12%
0.54%
0.15%
0.46%
0.54%
0.87%
0.21%
0.56%
0.60%
0.25%
NA
0.38%
0.21%
0.27%
0.56%
0.21%
Avoided
Cost to
Sales
Revenues
Size
500 to 749
Employees
0.19%
0.13%
NA
1.73%
0.05%
0.32%
0.12%
0.41%
1.42%
0.95%
0.13%
0.67%
0.54%
0.19%
NA
NA
0.16%
0.42%
0.67%
0.13%
Avoided
Cost to
Sales
Revenues
Size
750 to 999
Employees
0.12%
0.19%
NA
1.83%
0.04%
0.30%
0.13%
0.20%
0.79%
0.88%
0.19%
0.72%
0.58%
NA
NA
NA
0.05%
0.60%
0.72%
0.19%
Avoided Cost
to Sales
Revenues
Size
1,000 to 1,499
Employees
0.10%
0.10%
NA
1.75%
0.02%
0.79%
0.12%
0.35%
0.67%
0.65%
0.10%
0.90%
0.42%
0.12%
NA
0.36%
0.06%
0.61%
0.90%
0.10%
oo
(continued)
-------
Table 6.12. Title V Avoided Costs for Small New Commercial Sources of GHG Emissions Compared to Annual Sales Revenue
(continued)
Sector
Residential
Source Category
Residential
NAICS
531110
SBA Size
Standard
(effective
August 11,
2008)
7
Average Cost
Per Entity
(Sl,000/entity)
$23,175
Avoided
Cost to
Average
Sales
Revenues
for All
Enterprises
2.33%
Avoided
Cost to
Sales
Revenues
Size <20
Employees
3.23%
Avoided
Cost to
Sales
Revenues
Size
20 to 99
Employees
0.70%
Avoided
Cost to
Sales
Revenues
Size
100 to 499
Employees
0.84%
Avoided
Cost to
Sales
Revenues
Size
500 to 749
Employees
0.81%
Avoided
Cost to
Sales
Revenues
Size
750 to 999
Employees
NA
Avoided Cost
to Sales
Revenues
Size
1,000 to 1,499
Employees
NA
oo
to
The Census Bureau defines an enterprise as a business organization consisting of one or more domestic establishments that were specified under common ownership or control.
The enterprise and the establishment are the same for single-establishment firms. Each multi-establishment company forms one enterprise—the enterprise employment and annual
payroll is summed from the associated establishments. Enterprise size designations are determined by the summed employment of all associated establishments.
Since the SBA's business size definitions (http://www.sba.gov/size) apply to an establishment's ultimate parent company, we assume in this analysis that the enterprise definition
above is consistent with the concept of ultimate parent company that is typically used for SBREFA screening analyses.
NAICS code 611519: Job Corps Centers. For classifying a Federal procurement, the purpose of the solicitation must be for the management and operation of a U.S. Department of
Labor Job Corps Center. The activities involved include admissions activities, life skills training, educational activities, comprehensive career preparation activities, career
development activities, career transition activities, as well as the management and support functions and services needed to operate and maintain the facility. For SBA assistance as
small business concern, other than for Federal Government procurements, a concern must be primarily engaged in providing the services to operate and maintain Federal Job Corps
Centers.
NAICS code 541711 and 541712: For research and development contracts requiring the delivery of a manufactured product, the appropriate size standard is that of the
manufacturing industry.
-------
Table 6.13. Avoided Costs for Small Modifying Commercial PSD GHG Emission Sources Compared to Annual Sales Revenue
Sector
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Source Category
Education
Enclosed Mall
Food Sales
Food Service
Inpatient Health Care
Laboratory
Laboratory
Lodging
Nonrefrigerated
Warehouse
Nursing
Office
Other
Outpatient Health Care
Public Assembly
Public Order and Safety
Refrigerated Warehouse
Religious Worship
Retail Other than Mall
Service
Strip Shopping Mall
NAICS
61
531120
722
622
541380
5417
721
49311
623
531120
81
621
71
49312
813110
44-45
81
531120
SBA Size
Standard
(effective
August 11,
2008)
7.0-35.0
7
7.0-20.5
34.5
12
7
7
25.5
7.0-13.5
7
7.0-25.0
7.0-34.5
7
25.5
7
7.0-29.0
7.0-25.0
7
Average Cost
Per Entity
(Sl,000/entity)
$59,152
$59,152
$59,152
$59,152
$59,152
$59,152
$59,152
$59,152
$59,152
$59,152
$59,152
$59,152
$59,152
$59,152
$59,152
$59,152
$59,152
$59,152
$59,152
$59,152
Avoided
Cost to
Average
Sales
Revenues
for All
Enterprises
2.10%
3.45%
NA
7.97%
0.08%
2.98%
1.15%
2.59%
2.70%
2.76%
3.45%
8.91%
4.95%
3.84%
NA
1.17%
10.68%
1.84%
8.91%
3.45%
Avoided
Cost to
Sales
Revenues
Size <20
Employees
15.61%
6.26%
NA
18.52%
3.09%
9.88%
6.88%
13.12%
7.87%
18.96%
6.26%
15.71%
9.20%
10.88%
NA
6.69%
23.53%
6.09%
15.71%
6.26%
Avoided
Cost to
Sales
Revenues
Size 20 to
99
Employees
2.67%
0.96%
NA
4.78%
1.05%
2.08%
1.01%
2.91%
2.17%
3.70%
0.96%
2.66%
2.08%
2.55%
NA
1.58%
2.77%
0.88%
2.66%
0.96%
Avoided
Cost to
Sales
Revenues
Size 100 to
499
Employees
0.87%
0.53%
NA
3.80%
0.30%
1.38%
0.38%
1.16%
1.37%
2.22%
0.53%
1.43%
1.54%
0.63%
NA
0.97%
0.54%
0.69%
1.43%
0.53%
Avoided
Cost to
Sales
Revenues
Size
500 to 749
Employees
0.49%
0.34%
NA
4.42%
0.13%
0.83%
0.31%
1.05%
3.62%
2.43%
0.34%
1.71%
1.38%
0.48%
NA
NA
0.40%
1.08%
1.71%
0.34%
Avoided
Cost to
Sales
Revenues
Size
750 to 999
Employees
0.31%
0.50%
NA
4.66%
0.09%
0.76%
0.34%
0.51%
2.01%
2.25%
0.50%
1.84%
1.49%
NA
NA
NA
0.13%
1.52%
1.84%
0.50%
Avoided Cost
to Sales
Revenues
Size
1,000 to 1,499
Employees
0.25%
0.25%
NA
4.46%
0.06%
2.01%
0.32%
0.89%
1.71%
1.65%
0.25%
2.28%
1.08%
0.31%
NA
0.92%
0.16%
1.56%
2.28%
0.25%
oo
(continued)
-------
Table 6.13. Avoided Costs for Small Modifying Commercial PSD GHG Emission Sources Compared to Annual Sales Revenue
(continued)
Sector
Residential
Source Category
Residential
NAICS
531110
SBA Size
Standard
(effective
August 11,
2008)
7
Average Cost
Per Entity
(Sl,000/entity)
$59,152
Avoided
Cost to
Average
Sales
Revenues
for All
Enterprises
5.95%
Avoided
Cost to
Sales
Revenues
Size <20
Employees
8.25%
Avoided
Cost to
Sales
Revenues
Size 20 to
99
Employees
1.78%
Avoided
Cost to
Sales
Revenues
Size 100 to
499
Employees
2.15%
Avoided
Cost to
Sales
Revenues
Size
500 to 749
Employees
2.07%
Avoided
Cost to
Sales
Revenues
Size
750 to 999
Employees
NA
Avoided Cost
to Sales
Revenues
Size
1,000 to 1,499
Employees
NA
oo
The Census Bureau defines an enterprise as a business organization consisting of one or more domestic establishments that were specified under common ownership or control.
The enterprise and the establishment are the same for single-establishment firms. Each multi-establishment company forms one enterprise—the enterprise employment and annual
payroll is summed from the associated establishments. Enterprise size designations are determined by the summed employment of all associated establishments.
Since the SBA's business size definitions (http://www.sba.gov/size) apply to an establishment's ultimate parent company, we assume in this analysis that the enterprise definition
above is consistent with the concept of ultimate parent company that is typically used for SBREFA screening analyses.
NAICS code 611519: Job Corps Centers. For classifying a Federal procurement, the purpose of the solicitation must be for the management and operation of a U.S. Department of
Labor Job Corps Center. The activities involved include admissions activities, life skills training, educational activities, comprehensive career preparation activities, career
development activities, career transition activities, as well as the management and support functions and services needed to operate and maintain the facility. For SBA assistance as
small business concern, other than for Federal Government procurements, a concern must be primarily engaged in providing the services to operate and maintain Federal Job Corps
Centers.
NAICS code 541711 and 541712: For research and development contracts requiring the delivery of a manufactured product, the appropriate size standard is that of the
manufacturing industry.
-------
Table 6.14. Avoided Costs to Small PSD New Commercial GHG Emission Sources
Sector
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Commercial
Source Category
Education
Enclosed Mall
Food Sales
Food Service
Inpatient Health Care
Laboratory
Laboratory
Lodging
Nonrefrigerated
Warehouse
Nursing
Office
Other
Outpatient Health Care
Public Assembly
NAICS
61
531120
722
622
541380
5417
721
49311
623
531120
81
621
71
Public Order and Safety
Refrigerated Warehouse
Religious Worship
Retail Other than Mall
Service
Strip Shopping Mall
49312
813110
44-45
81
531120
SBA Size
Standard
(effective
August 11,
2008)
7.0-35.0
7
7.0-20.5
34.5
12
7
7
25.5
7.0-13.5
7
7.0-25.0
7.0-34.5
7
25.5
7
7.0-29.0
7.0-25.0
7
Average Cost
Per Entity
(SlOOO/entity)
$82,327
$82,327
$82,327
$82,327
$82,327
$82,327
$82,327
$82,327
$82,327
$82,327
$82,327
$82,327
$82,327
$82,327
$82,327
$82,327
$82,327
$82,327
$82,327
$82,327
Avoided
Cost to
Average
Sales
Revenues
for All
Enterprises
2.92%
4.80%
NA
11.09%
0.11%
4.14%
1.59%
3.60%
3.76%
3.84%
4.80%
12.41%
6.89%
5.35%
NA
1.63%
14.87%
2.57%
12.41%
4.80%
Avoided
Cost to
Sales
Revenues
Size <20
employees
21.74%
8.71%
NA
25.78%
4.30%
13.76%
9.57%
18.26%
10.96%
26.40%
8.71%
21.87%
12.81%
15.15%
NA
9.31%
32.77%
8.48%
21.87%
8.71%
Avoided
Cost to
Sales
Revenues
Size
20 to 99
employees
3.72%
1.34%
NA
6.65%
1.46%
2.90%
1.40%
4.05%
3.02%
5.15%
1.34%
3.70%
2.90%
3.55%
NA
2.20%
3.86%
1.22%
3.70%
1.34%
Avoided
Cost to
Sales
Revenues
Size
100 to 499
employees
1.21%
0.74%
NA
5.29%
0.42%
1.92%
0.53%
1.62%
1.91%
3.09%
0.74%
2.00%
2.14%
0.87%
NA
1.35%
0.75%
0.97%
2.00%
0.74%
Avoided
Cost to
Sales
Revenues
Size
500 to 749
employees
0.68%
0.47%
NA
6.15%
0.18%
1.15%
0.42%
1.46%
5.04%
3.38%
0.47%
2.38%
1.93%
0.67%
NA
NA
0.56%
1.50%
2.38%
0.47%
Avoided
Cost to
Sales
Revenues
Size
750 to 999
employees
0.43%
0.69%
NA
6.49%
0.13%
1.06%
0.48%
0.71%
2.79%
3.13%
0.69%
2.56%
2.08%
NA
NA
NA
0.18%
2.12%
2.56%
0.69%
Avoided Cost
to Sales
Revenues
Size
1,000 to 1,499
employees
0.34%
0.35%
NA
6.21%
0.08%
2.80%
0.44%
1.23%
2.38%
2.30%
0.35%
3.18%
1.51%
0.43%
NA
1.28%
0.22%
2.17%
3.18%
0.35%
oo
(continued)
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Table 6.14. Avoided Costs to Small PSD New Commercial GHG Emission Sources (continued)
Sector
Residential
Source Category
Residential
NAICS
531110
SBA Size
Standard
(effective
August 11,
2008)
7
Average Cost
Per Entity
(SlOOO/entity)
$82,327
Avoided
Cost to
Average
Sales
Revenues
for All
Enterprises
8.29%
Avoided
Cost to
Sales
Revenues
Size <20
employees
11.49%
Avoided
Cost to
Sales
Revenues
Size
20 to 99
employees
2.48%
Avoided
Cost to
Sales
Revenues
Size
100 to 499
employees
2.99%
Avoided
Cost to
Sales
Revenues
Size
500 to 749
employees
2.89%
Avoided
Cost to
Sales
Revenues
Size
750 to 999
employees
NA
Avoided Cost
to Sales
Revenues
Size
1,000 to 1,499
employees
NA
The Census Bureau defines an enterprise as a business organization consisting of one or more domestic establishments that were specified under common ownership or control. The
enterprise and the establishment are the same for single-establishment firms. Each multi-establishment company forms one enterprise—the enterprise employment and annual payroll is
summed from the associated establishments. Enterprise size designations are determined by the summed employment of all associated establishments.
Since the SBA's business size definitions (http://www.sba.gov/size) apply to an establishment's ultimate parent company, we assume in this analysis that the enterprise definition above
is consistent with the concept of ultimate parent company that is typically used for SBREFA screening analyses.
NAICS code 611519: Job Corps Centers. For classifying a Federal procurement, the purpose of the solicitation must be for the management and operation of a U.S. Department of
Labor Job Corps Center. The activities involved include admissions activities, life skills training, educational activities, comprehensive career preparation activities, career development
activities, career transition activities, as well as the management and support functions and services needed to operate and maintain the facility. For SBA assistance as small business
concern, other than for Federal Government procurements, a concern must be primarily engaged in providing the services to operate and maintain Federal Job Corps Centers.
NAICS code 541711 and 541712: For research and development contracts requiring the delivery of a manufactured product, the appropriate size standard is that of the manufacturing
industry.
oo
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Section 7
Statutory and Executive Order Reviews
7.1 Executive Order 12866 - Regulatory Planning and Review
Under section 3(f)(l) of Executive Order (EO) 12866 (58 FR 51735, October 4, 1993),
this action is an "economically significant regulatory action" because it is likely to have an
annual effect on the economy of $100 million or more. Accordingly, EPA submitted this action
to the Office of Management and Budget (OMB) for review under EO 12866 and any changes
made in response to OMB recommendations have been documented in the docket for this action.
In addition, EPA prepared an analysis of the potential costs and benefits associated with
this action. This analysis is contained in the RIA for this final rule. A copy of the analysis is
available in the docket for this action and the analysis is briefly summarized in section VII of this
preamble.
This rule uses a phased-in approach for requiring larger sources of GHG emissions to
comply with title V operating permit and PSD statutory requirements, essentially lifting this
burden for a period of at least 6 years for a large number of sources of GHG. Thus, this rule
provides regulatory relief rather than regulatory requirements for these GHG sources. For
sources of GHG that will be required to obtain title V permits and/or comply with PSD
requirements, there are no direct economic burdens or costs as a result of this final rule, because
these requirements are not imposed as a result of this rulemaking. Statutory requirements to
obtain a title V operating permit or to adhere to PSD requirements are already mandated by the
CAA and by existing rules, not by this rule. As a result, this Tailoring rule annual effect on the
economy will be positive because it will result in billions of dollars of regulatory relief during
the phase-in period.
7.2 Paperwork Reduction Act
This action does not impose any new information collection burden. Instead, this action
will significantly reduce costs incurred by sources and permitting authorities relative to the costs
that would be incurred if EPA did not revise the rule. Based on our revised GHG threshold data
analysis, we estimate that over 80,000 new and modified facilities per year would be subject to
PSD review based on applying a GHG emissions threshold of 100/250 tpy using a CO26 metric.
This is compared to 280 PSD permits currently issued per year, which is an increase of more
than 280-fold. Similarly, for title V, we estimate that over six million new sources would be
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affected at the 100-tpy threshold for GHGs using the CC^e metric. By increasing the volume of
permits by over 400 times, the administrative burden would be unmanageable without this rule.
However, OMB has previously approved the information collection requirements
contained in the existing regulations for PSD (see, e.g.. 40 CFR 52.21) and title V (see 40 CFR
parts 70 and 71) under the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501 et seq.
and has assigned OMB control number 2060-0003 and OMB control number 2060-0336. The
OMB control numbers for EPA's regulations in 40 CFR are listed in 40 CFR part 9.
7.3 Regulatory Flexibility Act
The Regulatory Flexibility Act (RFA) generally requires an agency to prepare a
regulatory flexibility analysis of any rule subject to notice and comment rulemaking
requirements under the APA or any other statute unless the agency certifies that the rule will not
have a significant economic impact on a substantial number of small entities. Small entities
include small businesses, small organizations, and small governmental jurisdictions.
For purposes of assessing the impacts of this final action on small entities, small entity is
defined as: (1) a small business that is a small industrial entity as defined in the U.S. SB A size
standards (see 13 CFR 121.201); (2) a small governmental jurisdiction that is a government of a
city, county, town, school district, or special district with a population of less than 50,000; or (3)
a small organization that is any not-for-profit enterprise that is independently owned and
operated and is not dominant in its field.
After considering the economic impacts of this final rule on small entities, the
Administrator certified that this final action will not have a significant economic impact on a
substantial number of small entities. In determining whether a rule has a significant economic
impact on a substantial number of small entities, the impact of concern is any significant adverse
economic impact on small entities, since the primary purpose of the regulatory flexibility
analyses is to identify and address regulatory alternatives "which minimize any significant
economic impact of the rule on small entities." 5 USC 603 and 604. Thus, an agency may
certify that a rule will not have a significant economic impact on a substantial number of small
entities if the rule relieves regulatory burden, or otherwise has a positive economic effect on all
of the small entities subject to the rule.
We have therefore concluded that this final rule will relieve the regulatory burden for
most affected small entities associated with the major PSD and title V operating permits
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programs for new or modified major sources that emit GHGs, including small businesses. This
is because this rule raises the major source applicability thresholds for these programs for the
sources that emit GHGs. As a result, the program changes provided in this rule are not expected
to result in a significant economic impact on a substantial number of small entities.
7.4 Unfunded Mandates Reform Act
This rule does not contain a federal mandate that may result in expenditures of $100
million or more for state, local, and tribal governments, in the aggregate, or the private sector in
any 1 year. Only those few states whose permitting authorities do not implement the federal
PSD and title V rules by reference in their SIPs will have a small increase in burden. These
states will have to amend their corresponding SIPs to incorporate the new applicability
thresholds, since the burden reducing thresholds that we are finalizing with this rule will not
otherwise apply to the PSD and title V programs. Thus, this rule is not subject to the
requirements of sections 202 or 205 of UMRA.
This rule is also not subject to the requirements of section 203 of UMRA because it
contains no regulatory requirements that might significantly or uniquely affect small
governments. As discussed earlier, this rule is expected to result in cost savings and an
administrative burden reduction for all permitting authorities and permittees, including small
governments.
7.5 Executive Order 13132 - Federalism
This action does not have federalism implications. It will not have substantial direct
effects on the states, on the relationship between the national government and the states, or on
the distribution of power and responsibilities among the various levels of government, as
specified in Executive Order 13132. These final amendments will ultimately simplify and
reduce the burden on state and local agencies associated with implementing the PSD and title V
operating permits programs, by providing that a source whose GHG emissions are below the
proposed levels will not have to obtain a PSD permit or title V permit. Thus, Executive Order
13132 does not apply to this action.
In the spirit of Executive Order 13132, and consistent with EPA policy to promote
communications between EPA and state and local governments, EPA specifically solicited
comment on the proposed rule from state and local officials.
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7.6 Executive Order 13175 - Consultation and Coordination with Indian Tribal
Governments
Subject to the Executive Order 13175 (65 FR 67249, November 9, 2000) EPA may not
issue a regulation that has tribal implications, that imposes substantial direct compliance costs,
and that is not required by statute, unless the federal government provides the funds necessary to
pay the direct compliance costs incurred by tribal governments, or EPA consults with tribal
officials early in the process of developing the proposed regulation and develops a tribal
summary impact statement.
EPA has concluded that this action may have tribal implications. However, it will neither
impose substantial direct compliance costs on tribal governments, nor preempt Tribal law. There
are no tribal authorities currently issuing major NSR permits; therefore, it will not currently
impose direct compliance costs on tribal governments.
EPA consulted with tribal officials early in the process of developing this regulation to
allow them to have meaningful and timely input into its development by publishing an ANPR
that included PSD GHG tailoring options for regulating GHGs under the CAA. (73 FR 44354,
July 30, 2008) As a result of the ANPR, EPA received several comments from tribal officials on
differing PSD GHG tailoring options presented in the ANPR which were considered in the
proposal and this final rule. Additionally, we also specifically solicited comment from tribal
officials on the proposed rule (74 FR 55292, October 27, 2009).
As required by section 7(a) of Executive Order 13175, EPA's Tribal Consultation
Official has certified that the requirements of the Executive Order have been met in a meaningful
and timely manner. A copy of the certification is included in the docket for this action.
7.7 Executive Order 13045 - Protection of Children from Environmental Health and
Safety Risks
EPA interprets EO 13045 (62 FR 19885, April 23, 1997) as applying only to those
regulatory actions that concern health or safety risks, such that the analysis required
under section 5-501 of the EO has the potential to influence the regulation. This action is
not subject to EO 13045 because it does not establish an environmental standard intended
to mitigate health or safety risks.
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7.8 Executive Order 13211 - Actions That Significantly Affect Energy Supply,
Distribution, or Use
This action is not a "significant energy action" as defined in Executive Order 13211(66
FR 28355 (May 22, 2001)), because it is not likely to have a significant adverse effect on the
supply, distribution, or use of energy. Further, we have concluded that this rule is not likely to
have any adverse energy effects because this action would not create any new requirements for
sources in the energy supply, distribution, or use sectors.
7.9 National Technology Transfer and Advancement Act
Section 12(d) of the National Technology Transfer and Advancement Act of 1995
("NTTAA"), Public Law No. 104-113, 12(d) (15 U.S.C. 272 note) directs EPA to use voluntary
consensus standards in its regulatory activities unless to do so would be inconsistent with
applicable law or otherwise impractical. Voluntary consensus standards are technical standards
(e.g., materials specifications, test methods, sampling procedures, and business practices) that are
developed or adopted by voluntary consensus standards bodies. The NTTAA directs EPA to
provide Congress, through OMB, explanations when the Agency decides not to use available and
applicable voluntary consensus standards.
This action does not involve technical standards. Therefore, EPA did not consider the
use of any voluntary consensus standards.
7.10 Executive Order 12898 - Federal Actions to Address Environmental Justice in
Minority Populations and Low-Income Populations
Executive Order (EO) 12898 (59 FR 7629 (Feb. 16, 1994)) establishes federal executive
policy on environmental justice. Its main provision directs federal agencies, to the greatest
extent practicable and permitted by law, to make environmental justice part of their mission by
identifying and addressing, as appropriate, disproportionately high and adverse human health or
environmental effects of their programs, policies, and activities on minority populations and low-
income populations in the United States.
EPA has concluded that it is not practicable to determine whether there would be
disproportionately high and adverse human health or environmental effects on minority and/or
low income populations from this rule. This rule is necessary in order to allow for the continued
implementation of permitting requirements established in the statute. Specifically, without this
rule, the CAA permitting programs (PSD and Title V) would become overwhelmed and
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unmanageable by the millions of GHG sources that would become newly subject to them. This
would result in severe impairment of the functioning of these programs with potentially adverse
human health and environmental effects nationwide. Under this rule and the legal doctrines of
absurd results, administrative necessity, and one-step-at-a-time, EPA is ensuring that the CAA
permitting programs continue to operate by limiting their applicability to the maximum number
of sources the programs can possibly handle. This approach is consistent with congressional
intent as it allows PSD applicability to at least the largest sources initially, at least to as many
more sources as possible, and as promptly as possible over time. By doing so, this rule allows
for the maximum degree of environmental protection possible while providing regulatory relief
for the unmanageable burden that would otherwise exist. Therefore, we believe it is not
practicable to identify and address disproportionately high and adverse human health or
environmental effects on minority populations and low income populations in the United States
under this final rule.
7.11 Congressional Review Act
The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the Small Business
Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take
effect, the agency promulgating the rule must submit a rule report, which includes a copy of the
rule, to each House of the Congress and to the Comptroller General of the United States. EPA
will submit a report containing this rule and other required information to the U.S. Senate, the
U.S. House of Representatives, and the Comptroller General of the United States prior to
publication of the rule in the Federal Register. A Major rule cannot take effect until 60 days after
it is published in the Federal Register. This action is a "major rule" as defined by 5 U.S.C.
804(2).
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Section 8
Limitations and Uncertainties
The benefits, costs and economic impacts estimated in this RIA are subject to limitations
and uncertainties. The benefits of this rule are the regulatory relief provided to small sources of
GHG and permitting authorities. Regulatory relief estimates are provided for the final rule Steps
1, 2 and 3 on an annual basis as well as for the full phase-in period. The benefits or avoided
permitting are based upon the best data available currently regarding sources affected and burden
cost estimates but are subject to uncertainties.
Benefit Estimate Limitations and Uncertainties
Uncertainties exist in the affected source counts at different thresholds used to estimate
regulatory relief due to the absence of a comprehensive data set of facility-level GHG emissions
across all sectors on which to base the number of facilities subject to title V and PSD permitting
at alternative regulatory thresholds. These affected source counts are multiplied by the permit
burden cost estimates to derive the benefits (regulatory relief) estimates for the rule. Specific
uncertainties in the estimates of affected sources, burden estimates and other limitations of the
benefits analysis are discussed below.
a. Uncertainties in Estimates of Affected Sources
In order to estimate the number of facilities that exceed a given GHG threshold (such as a
100 or 250 tpy CO2e emission threshold for baseline analysis), it is necessary to have emissions
inventory data at the facility or building level, including, and particularly for lower threshold
scenarios, numerous small sources in the residential and commercial sectors (e.g., apartment
buildings and office buildings). Historically, however, EPA has not collected sector-wide,
facility-level information for GHG emissions under the CAA (with the exception of information
from electric generating units required to report CO2 emissions under the Acid Rain Program
reporting requirements). To date, national EPA inventories of GHG sources have primarily
focused on 'top-down' estimates of GHG emissions from sectors and sources, and not facility-
level estimates. As a result, many of the uncertainties described here result from the absence of a
comprehensive data set of facility-level GHG emissions across all sectors.
For residential, commercial, and smaller manufacturing operations, our current analysis
relies on sample facility datasets and 'top-down' sector data (e.g., national fuel consumption
statistics and/or building characteristics). There are inherent uncertainties in developing source
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counts from the allocation of these nationally aggregated statistics. The allocation factors we
used, based on U.S. Energy Information Administration statistical sampling procedures and
energy consumption statistics, are likely the best available to estimate the population of
residential, commercial, and small manufacturing sources exceeding different GHG thresholds.
However, uncertainties may result in either overestimating or underestimating GHG emissions
for a given individual facility. It is worth noting that our estimates for the largest GHG emitting
sources, such as electric utilities and refineries, are derived from bottom-up calculations of
individual facility/building emissions so that there is increased certainty in evaluating and
comparing the facility counts at the higher GHG threshold scenarios where residential and
commercial sources are not highly affected. Although there are different levels of uncertainty in
our facility level estimates across sectors, we do believe that the data are sufficiently robust to
use in the aggregate to assess national permitting level impacts.
EPA's estimate of affected sources is based on their potential to emit emissions, as
opposed to actual emission levels. PTE is defined as the maximum capacity of a stationary
source to emit a pollutant under its physical and operational design, including certain legal
limitations, for example, on emissions or hours of operation. PSD and Title V programs both use
PTE for defining and identifying major sources. Although we have attempted to identify
reasonable adjustments to account for PTE in our methodology, there are significant
uncertainties in our PTE-based estimates, particularly for the commercial, residential and small
manufacturing sectors that have not traditionally been subject to any form of air permitting. In
practice, for example, for the residential sector and for many of the facilities in the commercial
sector, where CO2 emissions are primarily due to space heating/appliance usage, the combustion
units are not likely to be used constantly at their maximum rated capacity because heating is not
needed year-round and heating systems have thermostats. However, for our analysis we do
assume full PTE-based estimates for the residential and commercial sectors, using PTE
adjustment factors of 10 and 6.6, respectively to adjust actual emissions to PTE level. Absent
industry specific data, for small manufacturing source categories we assume a PTE adjustment
factor of 2; individual manufacturing facilities may operate their combustion equipment at levels
above and below this capacity utilization rate, but we believe this PTE adjustment reflects a
reasonable average rate across the variety of small manufacturing facilities included in the
threshold analysis. Ultimately, the number of sources brought into either the PSD or Title V
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programs due solely to their PTE would depend on how EPA interprets PTE for various types of
emitting equipment (e.g., space-heating furnaces in residential and commercial buildings), and
the extent to which streamlined mechanisms are made available for sources to obtain legal limits
on their PTE so that the programs are not applicable. No such decisions or interpretations have
been made at this point and, as mentioned in the preamble, they will require significant time to
develop. As a result, our threshold analysis uniformly assumes that no PTE limits are in place
for any of the affected sectors, which may likely be the case in the immediate stages of GHG
permitting for affected sources.
There is significant uncertainty in both our modification rate for newly major GHG
sources and in our estimate of modification activity at existing major sources that will become
subject to PSD review for GHG emission increases. The general uncertainty results from
predicting not only how many major sources will undergo physical or operational changes in any
given year, but also which of those changes would result in GHG emissions increases that would
exceed a proposed GHG significance level. First, information is not available across sectors and
source categories on the types and numbers of specific physical and operational changes that
would result in GHG emissions increases in amounts that can be estimated and that therefore can
be compared to various GHG emissions significance levels. Second, there is uncertainty in how
many project modifications will occur within any given year because decisions on these projects
are driven by facility- and sector-based growth patterns and business planning decisions. Lastly,
some source categories and units that emit GHGs have not previously been subject to any type of
permitting or reporting requirements; as a result, for these sources, there is very little historical
record for use in estimating the number and types of projects that would occur at these sources
and, in turn, establish an appropriate significance level for GHGs.
b. Uncertainties in Permitting Costs
The permit burden cost estimates that are multiplied by the source counts to derive the
benefits of the rule are also subject to uncertainty. As noted Attachment C to the RIA, the
primary reference sources for our estimate of burden hours and costs for permitting GHGs are
the most recent ICRs for the PSD and title V programs. There a number of uncertainties
introduced in using these references for costing GHG permitting activities. First, we are
assuming that the average, conventional pollutant per-permit costs will be similar for GHGs. We
do recognize the likelihood that residential and commercial permits would be simpler and have a
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lower per-permit burden than traditional industrial sources, and have made adjustments for this:
however, for industrial sources we assume per-permit costs on par with what are estimated in the
latest ICRs for PSD and title V programs. There is uncertainty in applying these average ICR-
based costs to GHG permitting, even for industrial sources, because there is no historical track
record for permitting these GHG sources and thus any cost efficiencies that have been realized
over the years for conventional pollutant permitting, and thus reflected in the current ICRs, may
not be initially realized for GHG permitting. For example, we assume the same public hearing
estimate as included in the ICR for current PSD permits (i.e., that 1 in 50 major PSD permits
require a hearing)—for GHG sources this number may be higher initially if there ends up being
significantly more public interest in these permits. We do believe overall, however, that larger
facilities, especially those affected at higher threshold levels, will have had sufficient permitting
experience such that out ICR-based costs should reasonably reflect the added burden of
including GHGs.
As mentioned above, in our burden scenario analyses we do discount the ICR-based per-
permit costs for residential and commercial sources to reflect what we believe will generally be
simpler permits, involving primarily uniform combustion type equipment. For PSD we discount
the per-permit cost by 30%, and for title V we discount the per-permit cost by 50%. There is
significant uncertainty in these estimated discounts since we have no track record for permitting
these smaller commercial and residential sources. However, we do believe that, based solely on
the type and uniformity of the GHG emission units that would be subject to permitting at these
facilities under lower GHG threshold scenarios, that average per-permit costs would be less than
those currently experienced by more complex industrial facilities, with numerous emission units,
for currently regulated pollutants.
c. Additional uncertainties and limitations of the benefits analysis
Current avoided permitting cost or regulatory relief estimates also do not include the
avoided costs to comply with PSD BACT requirements due to lack of available data. This
omission will tend to reduce the amount of regulatory relief that smaller sources of GHG
reported in this RIA will experience during the phase-in period. In addition to the avoided
BACT costs we are unable to quantify, there are likely general economic costs associated with
requiring permitting for these smaller sources of GHG. Numerous public comments on the
proposed rule spoke to the economic burden permitting would place on sources above the actual
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costs to obtain a permit. These costs might include delays or impediments to entering a new
market or to expand existing facilities to accommodate economic growth. These avoided costs
might be viewed as additional costs of doing business or barriers to entry for these smaller
sources of GHG. The avoided economic costs of these possible additional costs or barriers to
doing business have not been considered in the regulatory relief estimates provided for this final
rule due to lack of available information on the nature and value of such avoided impacts. If
such avoided cost estimates were available, these estimates would tend to increase the regulatory
relief burden reported for the final rule.
For the multiple year regulatory relief estimates, we assume that the annual estimates can
be extrapolated to multiple years without adjustment. This presumes that permitting activity
would be constant over time. It is quite possible that permit activity for these smaller sources
may grow over time with economic growth and will likely vary from year to year due to
differences in business activity. However, we do not have sufficient information about these
year-to-year variations nor expected growth in permitting to develop more precise estimates.
Given the uncertainty in the annual relief estimates and the short time frame analyzed (five
years), we feel it reasonable to not consider these potential yearly fluctuations for the phase-in
period. Consideration of growth in permits over time would tend to increase the regulatory relief
estimates reported for the final rule.
In a similar manner, we do not discount the phase-in regulatory relief to the present in
this final report. Since the analytical time period evaluated varies from annual up to five years,
we feel this is a reasonable approach. Discounting the regulatory relief estimates to present
values would tend to lower the present value total amount of regulatory relief reported.
Social Cost Limitations and Uncertainties
The social costs of this rule are the foregone environmental benefits that might occur
during the phase-in period absent this rulemaking. This subject is discussed in Section 4 of the
RIA. We are unable to estimate the PSD BACT requirements that would likely occur for the
smaller sources of GHG at this time. Because BACT is a case-by-case decision and evolves over
time, because we do not at this time have historical experience with the available controls for
small-source GHG emissions, and because of the inherent uncertainty in describing the types of
sources that would have triggered BACT absent this rule, we cannot quantify the emission
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reductions that might be feasible or the associated pollution control costs. For this reason, the
social costs of this rule are discussed qualitatively in this RIA.
Economic Impact Limitations and Uncertainties
As previously discussed there is uncertainty in the estimates of sources affected by this
final rule and the permitting burden costs used to estimate the benefits (regulatory relief) of this
rule. These uncertainties also affect the economic impact analysis conducted. In the economic
impact analysis, we compare the avoided permit burden cost estimates to average industry
revenues in order to gauge the magnitude of regulatory relief for affected sources. We used
average industry revenue, and average firm revenue estimates by firm size to estimate avoided-
cost-to-sales ratios due to lack of data specific to the sources actually obtaining regulatory relief.
The actual benefits to individual firms affected by this rule may differ from industry averages.
98
-------
Section 9
References
U.S. Census Bureau. Statistics of U.S. Businesses: 2002.
U.S. Department of Labor, Bureau of Labor Statistics. Consumer Price Index 2002-2007.
http://www.bls.gov/cpi/.
U.S. Environmental Protection Agency. April 2010. Summary of Methodology and Data Use to
Estimate Burden Relief and Evaluate Resource Requirements at Alternative Greenhouse
Gas Permitting Thresholds. (Appendix C)
U.S. Environmental Protection Agency. April 2010. Technical Support Document for
Greenhouse Gas Emissions Threshold Evaluation. (Appendix B)
U.S. Environmental Protection Agency. November 2006. Final Guidance for EPA Rulewriters:
Regulatory Flexibility Act as Amended by the Small Business Regulatory Enforcement
Fairness Act. http://www.epa.gov/sbrefa/documents/rfaguidancel l-00-06.pdf
U.S. Small Business Administration. Table of Small Business Size Standards. Accessed 8/11/08.
http://www.sba.gov/idc/groups/public/documents/sba_homepage/serv_sstd_tablepdfpdf.
99
-------
Attachment A
Source Categories Affected by the Rule with Industry Detail
Table A-l. Title V Sources Expected to Experience Regulatory Relief at Alternative
Threshold Levels by Industry Category1
Title V
Source
Category
Electricity Generating Units
Adipic Acid Production
Aluminum Production
Ammonia Manufacturing
Cement Production
Electronics Manufacturing
Ferroalloy Production
Glass Production
HCFC-22 Production
Hydrogen Production
Iron and Steel Production
Lead Production
Lime Manufacturing
Magnesium Production
Nitric Acid Production
Petrochemical Production
Petroleum Refineries
Phosphoric Acid Production
Pulp and Paper Manufacturing
Silicon Carbide Production
Soda Ash Manufacturing
Titanium Dioxide Production
Zinc Production
Ethanol Production
Food Processing
Unspecified Industrial Stationary
Combustion (Other Manufacturing
and Industrial Facilities)
Underground Coal Mines
Oil and Natural Gas Systems
Landfills
MWCs
Sources Experiencing Regulatory Relief at Alternative Thresholds
25,000 tpy
161
0
0
0
0
134
0
247
0
33
0
4
3
0
1
0
o
J
0
0
0
0
0
o
5
54
3,438
163,054
135
2,266
1,430
1
50,000 tpy
285
0
0
0
0
145
0
247
0
37
0
4
23
0
2
0
3
0
3
0
0
0
3
54
3,438
165,083
160
2,353
2,447
1
Final Rule
Step 2
100,000 tpy
285
0
0
0
0
177
0
247
0
43
0
4
29
0
3
0
3
0
15
0
0
0
3
97
3,438
166,661
183
2,353
3,164
1
Final Rule
Stepl
Anyway
285
0
0
0
0
190
0
247
3
61
0
4
37
0
18
0
3
0
160
0
0
0
3
119
3,438
166,693
235
2,353
3,357
1
(continued)
100
-------
Table A-l. Title V Sources Expected to Experience Regulatory Relief at Alternative
Threshold Levels by Industry Category (continued)
Title V
Source
Category
Stationary Combustion Equipment
(Generators)
All Commercial — Stationary Fuel
Combustion
Multi-Family Fuel Combustion
Single-Family Fuel Combustion
Total
Sources Experiencing Regulatory Relief at Alternative Thresholds
25,000 tpy
37,351
1,354,760
610,340
3,925,000
6,098,352
50,000 tpy
37,351
1,355,321
610,480
3,925,000
6,102,374
Final Rule
Step 2 100,000
tpy
37,351
1,355,870
610,500
3,925,000
6,105,361
Final Rule
Stepl
Anyway
37,351
1,355,921
610,500
3,925,000
6,105,913
thresholds are shown as tpy CC^e. Attachment B U.S. Environmental Protection Agency. April 2010. "Technical
Support Document for Greenhouse Gas Emissions Threshold Evaluation." See docket at EPA-HQ-OAR-2009-
0517.
2Modifying PSD sources are also expected to experience regulatory relief, but these estimates are not reflected in
this table.
101
-------
Table A-2. New PSD Sources Expected to Experience Regulatory Relief at Alternative
Threshold Levels by Industry Category
New PSD Sources
Source
Category
Electricity
Generating Units
Adipic Acid
Production
Aluminum
Production
Ammonia
Manufacturing
Cement Production
Electronics
Manufacturing
Ferroalloy
Production
Glass Production
HCFC-22 Production
Hydrogen Production
Iron and Steel
Production
Lead Production
Lime Manufacturing
Magnesium
Production
Nitric Acid
Production
Petrochemical
Production
Petroleum Refineries
Phosphoric Acid
Production
Pulp and Paper
Manufacturing
Silicon Carbide
Production
Soda Ash
Manufacturing
Sources Experiencing Regulatory Relief at Alternative Thresholds1'2
25,000 tpy
20
0
0
0
0
0
0
1
0
0
0
0
0
0
0
0
0
0
0
0
0
50,000 tpy
29
0
0
0
0
0
0
1
0
0
0
0
0
0
0
0
0
0
0
0
0
Final Rule
Step 2
100,000 tpy
33
0
0
0
0
0
0
1
0
0
0
0
0
0
0
0
0
0
0
0
0
Final Rule
Stepl
Anyway
93
0
0
0
0
0
0
1
0
0
0
0
0
0
0
0
0
0
0
0
0
(continued)
102
-------
Table A-2. New PSD Sources Expected to Experience Regulatory Relief at Alternative
Threshold Levels by Industry Category (continued)
New PSD Sources
Source
Category
Titanium Dioxide
Production
Zinc Production
Ethanol Production
Food Processing
Unspecified
Industrial Stationary
Combustion (Other
Manufacturing and
Industrial Facilities)
Underground Coal
Mines
Oil and Natural Gas
Systems
Landfills
MWCs
Stationary
Combustion
Equipment
(Generators)
All Commercial -
Stationary Fuel
Combustion
Multi-Family Fuel
Combustion
Single-Family Fuel
Combustion
All
Sources Experiencing Regulatory Relief at Alternative Thresholds1'2
25,000 tpy
0
0
4
41
529
0
23
0
0
299
12,034
6,397
515
19,863
50,000 tpy
0
0
4
47
534
0
38
0
1
299
12,038
6,400
515
19,906
Final Rule
Step 2
100,000 tpy
0
0
7
47
544
0
44
0
1
299
12,039
6,400
515
19,930
Final Rule
Stepl
Anyway
0
0
10
47
546
0
48
0
2
299
12,041
6,400
515
20,002
Regulatory alternatives reflect tons per year CO2e potential to emit. Attachment B U.S. Environmental Protection
Agency. April 2010. "Technical Support Document for Greenhouse Gas Emissions Threshold Evaluation." See
docket at EPA-HQ-OAR-2009-0517.
2Modifying PSD sources are also expected to experience regulatory relief, but these estimates are not reflected in
this table.
103
-------
Attachment B
Technical Support Document
for Greenhouse Gas Emissions Thresholds
Evaluation
Air Quality Policy Division
Office of Air Quality Policy and Standards
U.S. Environmental Protection Agency
March 29, 2010
-------
Table of Contents
Page
1. Purpose 4
2. Overview 4
3. Emissions-based Threshold Analysis 5
3.1 General Description of Overall Approach 5
3.1.1 Threshold Levels 5
3.1.2 Greenhouse Gases 6
3.1.3 Source Sectors 7
3.1.4 Potential to Emit Methodology 8
3.1.5 New and Modified Sources 9
3.2 Threshold Summary Results 9
3.3 Electricity Generating Sector 12
3.4 Industrial Sector 14
3.4.1 Data Sources 17
3.4.2 Potential to Emit 17
3.4.3 Methodology for New Units 18
3.5 Methodology for Existing Unspecified Industrial Stationary Combustion Source
Category Emissions 18
3.6 Methodology for Existing Specific Industrial Sectors Considering Combustion,
Process, and Fugitive Emissions 20
-------
3.6.1 Adipic Acid Production 21
3.6.2 Aluminum Production 23
3.6.3 Ammonia Production 25
3.6.4 Cement Production 26
3.6.5 Electronic Production 27
3.6.6 Ethanol Production 29
3.6.7 Ferroalloy Production 31
3.6.8 Food Processing 33
3.6.9 Glass Manufacturing 34
3.6.10 HCFC-22 Production 35
3.6.11 Hydrogen Production 37
Table of Contents (cont.)
Page
3.6.12 Iron and Steel Production 38
3.6.13 Lead Production 41
3.6.14 Lime 42
3.6.15 Magnesium Production and Processing 43
3.6.16 Nitric Acid Production 45
3.6.17 Petrochemical Production 46
3.6.18 Petroleum Refineries 48
3.6.19 Phosphoric Acid Production 50
3.6.20 Pulp and Paper Manufacturing 51
3.6.21 Silicon Carbide Manufacturing 52
3.6.22 Soda Ash Production 54
3.6.23 Titanium Dioxide Production 55
3.6.24 Zinc Production 56
3.7 Energy Sector 57
3.7.1 Oil and Gas Systems 57
11
-------
3.7.2 Underground Coal Mining 58
3.8 Waste Sector 61
3.8.1 Landfills 61
3.8.2 Municipal Solid Waste Combustors 63
3.9 Agriculture (Stationary Fuel Combustion) 64
3.10 Commercial Stationary Fuel Combustion 66
3.11 Residential Buildings 69
3.11.1 Single-Family Homes 70
3.11.2 Multi-Family Residential Buildings 71
References 76
Appendix A 81
Appendix B 82
in
-------
Technical Support Document for Permit Thresholds for Greenhouse Gases
1. Purpose
The purpose of this document is to provide the background information that was used to
support EPA's decision process on evaluating and selecting greenhouse gas (GHG) major source
applicability thresholds for Prevention of Significant Deterioration (PSD) and Title V permitting
for EPA's final rule "Prevention of Significant Deterioration and Title V Greenhouse Gas
Tailoring Rule". The document describes the analysis used to estimate the number of existing
and new facilities (e.g., industrial plant or commercial building) that would exceed different
GHG emission threshold levels. The document also summarizes the results of this analysis for
each sector. The results of this analysis served as one of the fundamental bases for evaluating
administrative burdens at both existing permitting thresholds and for evaluating and selecting
proposed alternative permitting thresholds to address administrative necessity concerns.
2. Overview
In order to support EPA's assessment of the administrative burden created by adding
GHGs to existing Prevention of Significant Deterioration (PSD) and Title V permitting
programs, it was necessary to develop information on the number of affected facilities at both the
current permitting major source thresholds (generally, 100 tons per year for Title V and 100 or
250 tons per year for PSD depending on the source category classification) and at alternative
higher thresholds. An affected facility would be one who's annual emissions of the GHG equal
or exceed the major source threshold being evaluated.
Eight threshold levels ranging from 100 to 100,000 tons per year of GHG emissions were
evaluated. Some of the alternative thresholds evaluated are the same as ones (e.g., 25,000 tons
per year CO2-equivalents) considered in previous studies and in support of EPA's proposed and
final GHG mandatory reporting rules (GHG MRR, 74 FR 68, pp. 16447 - 16731 and 74 FR 209,
pp. 56260-56519, respectively). One key difference between the emissions data developed for
this analysis and the emissions data developed to support the proposed GHG MRR is that this
analysis is based on a facility's "potential to emit" (PTE) while the proposed GHG reporting rule
was based on "actual" emissions (i.e., the emissions a facility actually emits in a given year).
PTE is defined as the maximum capacity of a stationary source to emit a pollutant under its
physical and operational design, including certain legal limitations, for example, on emissions or
hours of operation. NSR and Title V programs both use PTE for defining major sources. The
end result is generally that more facilities will exceed a given threshold on a PTE basis than on
an actual basis. This is an important differentiation in terms of both evaluating the thresholds
under this rule and when comparing the results to other threshold analysis, such as the supporting
data for the EPA's GHG MRR.
-------
Although the primary focus of this analysis was on the potential administrative burden
associated with different GHG permitting emission levels as represented in terms of number of
facilities potentially subject to permitting, information on GHG emissions from affected facilities
was also collected to assess the relative coverage of national stationary source GHG emissions at
the different threshold levels. While the environmental impact associated with the different
GHG permitting levels was not used as the basis for the GHG applicability thresholds identified
in the final GHG tailoring rule, the information on national emissions coverage provides a useful
measure to consider the potential scope of the proposed alternative thresholds, their coverage of
key GHG emission source categories, and whether they promote the environmental purposes of
the PSD and Title V programs.
3. Emissions-based Threshold Analysis
3.1 General Description of Overall Approach
This section presents a general description of the overall approach EPA used to evaluate a
range of permitting thresholds in terms of the number of sources affected, and amount of
emissions covered.
EPA made use of earlier analyses performed to develop emission thresholds for the
proposed and final GHG MRR, or used the same data sources when additional analyses were
required. EPA did not conduct primary research for this analysis, but instead relied on published
research and publicly available government data, such as EPA's eGRID database of electric
generating source emissions, Economic and Housing Census data, and Energy Information
Agency (EIA) data on energy consumption.
3.1.1 Threshold Levels
EPA evaluated eight different GHG emission thresholds:
GHG Thresholds
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
The first two thresholds are the current Clean Air Act major source criteria pollutant
thresholds for the federal operating permit program under Title V (generally, 100 tpy for major
-------
source applicability), and the PSD construction permit program under Title I. Under PSD, a
"major stationary source" is any source belonging to a specified list of 28 source categories
which emits or has a PTE of 100 tpy or more, or any other source type which emits or has the
potential to emit such pollutants in amounts equal to or greater than 250 tpy.
The six additional thresholds cover the range of thresholds evaluated for the proposed
GHG MRR, and add two additional thresholds at 5,000 and 50,000 tons per year. Like the Clean
Air Act, the permit thresholds are based on U.S. short tons (tons) instead of metric tons (nitons).
There is a three-orders-of-magnitude range in the thresholds which reflects the much
higher quantity of GHG emissions compared to criteria pollutant emissions from the primary
source of GHG emissions, fossil fuel combustion. For example, an uncontrolled natural gas-
fired boiler that emits 100 tons of NOX annually would at the same time emit about 100,000 tons
ofCO2.
The threshold analysis of source counts and emissions was done on a "potential to emit"
basis, because that is the basis that is relevant for the permitting requirements under PSD and
title V. Potential emissions (in short tons) from each source were evaluated against the threshold
levels in order to determine whether or not a source would be included in the threshold count.
When a source was identified as being covered by a given threshold level, the actual emissions
from that source were included to determine the emissions covered by the threshold. In other
words, where summary tables present "Tg GHG Emissions Covered per Year" these are the
actual emissions that would be covered by the threshold level, given the source count arrived at
considering potential to emit emission levels.
3.1.2 Greenhouse Gases
EPA evaluated emissions of the major GHGs that are directly emitted by human activities
at the eight threshold levels. The GHGs evaluated are shown below in Table 1. For purposes of
this analysis emissions were evaluated on both an individual GHG mass basis and CO2-
equivalent basis (CC^e). CC^e normalizes the different heat trapping capacities of the different
GHGs to that of CC>2. A quantity of a GHG is converted to a CC^e basis by multiplying the mass
of the compound emitted by its Global Warming Potential (GWP). The GWP is a metric that
incorporates both the heat-trapping ability and atmospheric lifetime of each GHG relative to
CO2.
-------
Table 1
Major GHGs Directly Emitted by Human Activities
Greenhouse Gas
Carbon dioxide
Methane
Nitrous oxide
Perfluorocarbons
Hydrofluorocarbons
Sulfur hexafluoride
Chemical Formula
or Acronym
CO2
CH4
N2O
PFCs
MFCs
SF6
Global Warming
Potential (GWP)*
1
21
310
Varies by compound
Varies by compound
23,900
* GWP values as codified in the EPA's final GHG mandatory
reporting rule: Table A-l to Subpart A of Part 98 - Global
Warming Potentials, FR, Vol.74, No. 209, p. 56395.
Sector descriptions contained in this document include a discussion of GHGs evaluated
for each sector. If the analysis included more than one GHG, the description includes gas-
specific counts as well as a CC^e count. The threshold analyses for stationary fossil fuel
combustion were simplified by excluding CH4 and N2O emissions, because CC>2 comprises over
99 percent of GHG emissions from fossil fuel combustion.
3.1.3 Source Sectors
In this analysis EPA evaluated the same range of stationary source types with direct GHG
emissions as identified in the proposed and final GHG MRR. The proposed GHG MRR source
categories were based on a comprehensive review of all U.S. source categories with GHG
emissions, to include the categories that emit the most significant amount of GHG emissions.
The stationary sources evaluated in this analysis can be grouped in the sectors shown below:
• Electricity Generation (facilities with fossil fuel-fired electric generating units);
• Industry (range of industries with process and combustion GHG emissions);
• Energy (oil and gas extraction, transport, and processing; underground coal mining);
• Waste Treatment (landfills and municipal solid waste incinerators);
• Agriculture (stationary fuel combustion);
• Commercial (stationary fuel combustion); and
• Residential (stationary fuel combustion).
-------
A number of direct emission source types included in the GHG MRR analysis were not
included in the potential to emit analysis because the GHG emissions from these sources were
primarily fugitive emissions. Fugitive emissions are emissions which are not released, or could
not be reasonably released, through a stack or vent. Under the PSD rules, fugitive emissions are
only included in potential to emit estimates if the source is one of 28 listed PSD source
categories. Excluded fugitive emissions sources are listed below:
• Electrical equipment SF6 emissions;
• Wastewater treatment plants not associated with one of 28 listed PSD source categories
(combustion is captured in the commercial sector analysis); and
• Agricultural manure management.
3.1.4 Potential to Emit Methodology
As noted earlier, the potential to emit (PTE) is the amount of emissions that can be
emitted from a source operating at full capacity. The annual PTE is based on operation at full
equipment capacity, 24 hours per day, 365 days per year (8,760 hours per year). For example, if
a boiler has a maximum rated heat input capacity often million Btu per hour, the annual PTE for
that boiler is the amount of emissions from burning 87,600 million Btu of fuel:
10 mmBtu/hr x 8,760 hrs/yr = 87,600 mmBtu/yr
Capacity information and annual GHG emissions were available for some of the source
categories from analyses performed to support the GHG MRR. In some cases the supporting
analyses had already calculated GHG emissions on a full capacity basis, in which case EPA
directly used those estimates as PTE estimates. Alternatively, some data from the supporting
analysis estimated actual annual emissions using a baseline year. If capacity and baseline year
production information was provided in the supporting data, EPA adjusted the source actual
emissions estimate by the ratio of annual capacity to baseline production to estimate PTE. If
capacity information was not available, EPA used capacity factors from other data sources to
adjust actual emission estimates to PTE estimates. These capacity factors add varying
uncertainty to the PTE estimate. Detailed descriptions of the different PTE calculation
methodologies are included in the source descriptions in the following section.
Removal by pollution control equipment was considered in the PTE estimates, though
control equipment removal was relevant in only a few cases (thermal oxidation of HPCs and
CH4). Also, as noted earlier, fugitive emissions, were only included in the PTE estimates if the
source was one of the 28 listed PSD source categories. For example, fugitive CH4 emissions
from oil and gas transmission stations were not included in CH4 or CC^e emissions when
comparing to the different thresholds, but were included for iron and steel plants.
-------
3.1.5 New Construction
The source population data from the analyses supporting the GHG MRR, and other data
sources provide information on existing sources and their emissions. The PSD and title V
program requirements and applicability determinations, however, also apply to newly
constructed sources.
The general approach for estimating the annual number of newly constructed sources was
to apply growth rates in the number of units or facilities in a source category to the number of
existing facilities at the different thresholds. Growth rates were available from a variety of
sources including Economic Census data, EIA energy survey data, and various EPA regulatory
impact analyses and information collection requests which require source population estimates.
In some cases there was sufficient information to distribute new sources to different thresholds
based on emission information specific to the new sources (electric generating, municipal solid
waste combustors, and commercial stationary fuel combustion). Otherwise EPA assumed the
same size and threshold distribution for new units as for existing units. For example, if the
annual growth rate in a category was one percent, the number of existing facilities above a
threshold were multiplied by the fractional growth rate to estimate the number of new facilities at
that threshold per year.
EPA did not develop estimates for modifications to exsiting sources (which can be
potentially subject to PSD requirements) as part of this threshold study; estimates for
modifications were prepared under a separate burden analysis prepared for the final GHG
tailoring rule and located in the final docket for the rulemaking13.
3.2 Threshold Summary Results
The resulting counts of affected stationary source facilities and the amount of actual
GHG emissions covered at different PTE thresholds for all sectors are shown in the tables below.
GHG emissions covered at each threshold are in Tg, which is equivalent to million metric tons.
SI units were used for the covered emissions to be consistent with the EPA's official U.S. GHG
Inventory so that comparions could be made to the inventory in terms of emissions coverage at
different applicability thresholds. The complete data for the sectors and subsectors are provided
in supporting spreadsheets that accompany this report. These spreadsheets are identified in
Appendices A and B.
13 See "Summary of Methodology and Data Used to Estimate Burden Relief and Evaluate Resource Requirements at
Alternative Greenhouse Gas (GHG) Permitting Thresholds" contained in the public docket for the final tailoring
rule atEPA-HQ-OAR-2009-0517.
-------
Table 2
COie Threshold Summary — All Stationary Source Sectors
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
6,118,252
1,079,483
302,863
59,140
30,341
16,564
9,980
5,326
Number of New
Facilities Added
per Year
67,469
19,755
4,430
549
313
140
96
72
CO2e Emissions
Covered
(Tg per year)
3,867
3,786
3,723
3,622
3,564
3,493
3,387
3,267
Table 3
Threshold Summary — All Stationary Source Sectors
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
6,113,861
1,075,078
298,527
55,313
26,836
13,637
8,109
4,226
Number of New
Facilities Added
per Year
67,469
19,755
4,430
549
313
139
96
72
CO2 Emissions
Covered
(Tg per year)
3,651
3,570
3,513
3,413
3,357
3,293
3,212
3,114
10
-------
Table 4
CH4 Threshold Summary — All Stationary Source Sectors
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
4,201
3,851
2,887
1,042
466
138
34
o
J
Number of New
Facilities Added
per Year
0
0
0
0
0
0
0
0
CH4 Emissions
Covered
(Tg per year)
7.807
7.759
7.321
4.740
3.697
2.234
1.185
0.211
Table 5
Threshold Summary — All Stationary Source Sectors
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
47
46
31
5
0
0
0
0
Number of New
Facilities Added
per Year
0
0
0
0
0
0
0
0
N2O Emissions
Covered
(Tg per year)
0.074
0.074
0.068
0.022
0
0
0
0
11
-------
Table 6
High GWP Gases Threshold Summary ~ All Stationary Source Sectors
GHG
HFC
HFC
HFC
HFC
PFC
SF6
GHG
Threshold*
(tons per year)
100
250
1,000
5,000 and above
100 and above
100 and above
Number of
Existing Sources
o
J
3
1
0
0
0
Number of New
Facilities Added
per Year
0
0
0
0
0
0
GHG Emissions
Covered
(Tg per year)
0.001
0.001
0.001
0
0
0
* Where a threshold is not listed for a particular GHG, threshold counts for that threshold and any higher
thresholds can be assumed to be zero.
3.3 Electricity Generating Sector
Data Sources
The latest version of EPA's eGRID database (2006) was used to estimate the PTE of
electricity generating facilities and counts of units above the different emission thresholds. The
eGRID database includes year 2004 characteristics, operating information, and annual emissions
(including CO?) for U.S. facilities that have a generation capacity greater than one MW, and sell
electric power to the grid.
A facility's PTE was estimated based on the eGRID generator table. The generator table,
which is based on the 2004 EIA form 860 database, provides prime mover, generator nameplate
capacity, and primary energy source (fuel type) for each generator down to 0.1 MW. To
calculate PTE, we combined the nameplate capacity and primary fuel for each of the fossil-fired
units with average fuel based prime mover heat rates (Btu/kWh) published by EIA (EIA, 2007).
12
-------
Table 7
ECU Prime Mover Heat Rates
(EIA Electric Power Annual, Table A7, 2007)
Prime Mover
Steam turbine
Simple
combustion turbine
Combined cycle
combustion turbine
Internal
combustion engine
Fuel
Coal
Gas
Oil
Gas
Oil
Gas
Oil
Gas
Oil
Average Heat Rate (Btu/kWh)
10,114
10,466
10,400
11,459
13,216
7,445
11,015
9,923
10,149
The eGRID database includes cogeneration plants and generating units at industrial
plants that primarily supply electric power and steam to a host facility. We eliminated these
units from the electric generation facility population based on North American Industry
Classification System (NAICS) code, so that the only facilities included were facilities with a
NAICS code beginning with 22 (Utilities).
The generator-nameplate-heat-rate approach potentially underestimates PTE for
cogeneration plants, where a portion of the burner heat input provides useful thermal energy in
addition to electric output. This potential to underestimate PTE affects 321 of 2,237 or 14
percent of facilities evaluated.
Methodology for Existing Facilities
Fuel combustion was the only source of GHG emissions considered for the electricity
generation sector. From the eGRID and EIA information EPA calculated a maximum annual
fuel heat input based on 8,760 hours of operation for the combustors associated with the
generator. This calculated maximum annual heat input was used with fuel combustion emission
factors from the GHG MRR for the primary fuel, to calculate the facility PTE. The calculations
covered 10,487 fossil fuel-fired generators with nameplate capacities down to 0.1 MW or
100,000 kW.
EPA also did not evaluate fugitive CHi emissions from facility coal piles. Fossil fuel-
fired steam electric plants with heat input greater than 250 mmBtu/hr heat input are one of the 28
listed PSD source categories that include fugitive emissions when calculating PTE. However,
the CC>2 PTE from combustion alone for this size facility is about 225,000 tons per year. This is
13
-------
well over all of the emission thresholds considered in this analysis without consideration of the
contribution of fugitive CH4.
New Units
The eGRID generator table includes an online year field. To determine the number of
new units per year at different thresholds EPA counted generators online each year and totaled
the emissions associated with those generators at the facility level over the 15-year period from
1990 through 2004. Counts were made of the number of these facilities over the different PTE
thresholds, and averaged over the 15 years to arrive at the number of new or modified facilities
per year.
Threshold Summary
The table below shows the facilities and emissions covered at the different emission
thresholds based on the described methodology. There were a total of 2,237 facilities in the
electric generation population, so all facilities and all emissions are covered up to the 5,000 ton
PTE threshold. Almost all emissions (99.9 percent), and about 75 percent of facilities are
covered at the highest 100,000 ton PTE threshold.
Table 8
Threshold Summary Results — Electricity Generating Sector
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
2,237
2,237
2,237
2,237
2,195
2,076
1,911
1,721
Number of New
Facilities Added
per Year
93
93
93
91
86
73
64
60
CO2Emissions
Covered
(Tg per year)
2,373
2,373
2,373
2,373
2,373
2,373
2,373
2,371
3.4 Industrial Sector
The industrial sector comprises establishments engaged in the mechanical, physical, or
chemical transformation of materials, substances, or components into new products, and
specifically includes businesses classified in Sectors 31-33 according to the North American
14
-------
Industry Classification System (NAICS). Industrial source greenhouse gases result from
manufacturing processes as well as combustion processes. Because there is a great deal of
variability within the sector, this technical support document includes industry-specific
discussions after a general sector overview.
For the industrial sector, EPA considered the six individual greenhouse gases separately,
and also prepared an analysis considering CC^e. In preparation of the GHG MRR, EPA
identified 23 industrial sectors where the GHG emissions were significant; these sectors are
listed in Table 9.
15
-------
Table 9
Industrial Sectors and GHG Emissions
NAICS Code
325199
331312
325311
327310
334
325193
331112
3116
327
325120
331111
3314
327410
3314
325311
3251
324110
325312
3221
327910
325181
325188
3314
Industrial Sector
Adipic Acid Production
Aluminum Production
Ammonia Production
Cement Production
Electronics Manufacturing
Ethanol Production
Ferroalloy Production
Food Processing
Glass Production
HCFC-22 Production
Hydrogen Production
Iron and Steel Production
Lead Production
Lime Manufacturing
Magnesium Production
Nitric Acid Production
Petrochemical Production
Petroleum Refineries
Phosphoric Acid Production
Pulp and Paper Manufacturing
Silicon Carbide Production
Soda Ash Manufacturing
Titanium Dioxide Production
Zinc Production
CO2
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
CH4
X
X
X
X
X
N2O
X
X
SF6
X
X
HFC
X
X
PFC
X
X
In addition, there are a large number of industrial establishments across all industrial
sectors that emit less significant amounts of GHGs (primarily CC^) from stationary source fuel
combustion. Combustion emissions from these establishments were analyzed under the
Unspecified Industrial Stationary Combustion source category.
16
-------
3.4.1 Data Sources
There were several primary data sources used in preparation of the permit threshold
analysis. EPA consulted analyses prepared in support of the GHG MRR for the 23 industrial
sectors for which combustion, process and fugitive emissions were significant. These documents
can be found in the docket numbered EPA-HQ-OAR-2008-0508. The TSDs contain industry-
specific analyses of process, fugitive, and combustion emissions for industries. Supporting
analyses used to prepare the TSDs are found in entries 0046.7 and 0046.8 of the GHG MRR
docket. These emissions estimate details were helpful in breaking down TSD emission estimates
to compare facility-specific emissions against the additional threshold levels considered in the
permit threshold analysis, including 100, 250, 5,000, and 50,000 tons per year.
Combustion emissions analyses for the Unspecified Industrial Stationary Combustion
sectors used data from the 2002 Manufacturing Energy Combustion Survey (MECS) and the
U.S. Census Bureau's 2002 Economic Census. MECS is a survey of manufacturing and
industrial energy uses and costs prepared by the EIA (EIA, 2007). Data is collected by
manufacturing establishment through mailed questionnaires. The 2002 MECS data reflects
responses accounting for approximately 98 percent of the manufacturing payroll, and reports
separate energy use estimates for 48 NAICS industrial sector groups. The MECS provided
information on the amount of fuel burned in 2002 by sector on an employment basis. The 2002
Economic Census data provided information on the number of establishments sorted by three-
digit NAICS code and disaggregated into specific size categories based on employment (U.S.
Census, 2004).
3.4.2 Potential to Emit
As mentioned earlier in this document, permit threshold analyses considered both actual
emissions and PTE. When capacity information was not available, the analyses applied
utilization rates from the Industrial Production and Capacity Utilization, Federal Reserve
Statistical Release G-17 in order to adjust actual emissions to determine PTE emissions. These
utilization rates are prepared quarterly with annual revisions, and are published on the web
(http://www.federalreserve.gov/releases/gl7). The main data source for the industrial production
and capacity utilization rates is the U.S. Census Bureau's Census of Manufactures. Data
introduced from other Census Bureau publications include the Census of Services and the
Services Annual Survey (for publishing) and selected Current Industrial Reports. Additional
government source data include new annual data on minerals from the U.S. Geological Survey
(USGS) and updated deflators from the Bureau of Economic Analysis (BEA). In addition, the
annual revisions include monthly production estimates that reflect updated seasonal factors and
the inclusion of monthly source data that became available (or were revised) after the closing of
the regular four-month reporting window.
17
-------
3.4.3 Methodology for New Units
To determine the number of new units per year, EPA compared the number of
establishments by three-digitNAICS code in 1998 to the number of establishments by three-digit
NAICS code in 2002, and determined an average annual growth rate for each three-digit NAICS
code. The growth rates were applied to each threshold count to determine the number of annual
new establishments per industry per threshold. If the growth rate was determined to be negative,
EPA assumed that no new establishments would be added; however, establishments were not
reduced to reflect negative growth rates. EPA also supplemented these growth rates with agency
estimates of expected new sources from various information collection requests (ICR) and
regulatory impact analyses (RIA) efforts.
3.5 Methodology for Existing Unspecified Industrial Stationary Combustion Source
Category Emissions
In order to determine establishment counts and emissions totals for the unspecified
industrial stationary combustion sources, EPA used 2002 Economic Census data showing
manufacturing employment by NAICS code and Manufacturing Energy Consumption Survey
(MECS) data published by EIA. Calculating greenhouse gas emissions required determining
energy consumption per employee by industry and applying emission factors specific to the
consumption profile derived from MECS data.
The Economic Census data (2002) provide a count of establishments by employment
category, where employment category is defined by number of employees (e.g., 1-4,
5 - 9,... ,500 - 999,... ,more than 2,500). The MECS energy consumption data provide energy
consumption by industry. Both the employment data and the energy consumption data are
organized according to the NAICS codes.
As part of this analysis, EPA calculated industry-specific GHG emission factors. The
factors were calculated by considering actual fuel consumption in 2002, as determined by EIA.
Actual fuel consumed was multiplied by fuel-specific GHG emission factors to determine GHG
emissions by fuel type by industry. To simplify the analysis, EPA only included CO2 emissions
and ignored CH4 and N2O in the CO2e calculations. CO2 makes up between 99.3 and 99.7
percent of estimated CO2e emissions. Emissions for each fuel type were combined to determine
total emissions for a sector. Total emissions per sector were divided by total energy
consumption per sector to determine a factor to calculate GHG emissions per mmBtu of energy
consumption specific to the industrial sector.
The GHG emission factors were then multiplied by the energy consumption per
employee in order to determine emissions per employee. Multiplying the result by the average
number employees per establishment, EPA determined total GHG emissions per establishment.
The total emissions numbers were used to determine number of establishments and volume of
emissions that would be caught by each of the permit thresholds under consideration.
18
-------
As discussed previously, a separate threshold analysis was conducted for 23 industrial
sectors determined to have significant GHG emissions in the GHG MRR analysis. In order to
quantify the unspecified industrial stationary combustion source emissions, the combustion
emissions and establishment counts from 19 of these sectors were subtracted from the total
industrial MECS analysis. For the remaining four industries, HCFC-22 production, hydrogen
production, magnesium production, and nitric acid production, EPA could not readily isolate
combustion emissions. For these industries, their establishment counts were subtracted from the
unspecified industrial source threshold counts based on process emission threshold evaluations,
assuming that any facility exceeding a threshold for process-based emissions would exceed the
threshold regardless of their combustion CC>2 emissions.
Potential to Emit
In order to determine potential to emit from the MECS and Economic Census numbers,
EPA assumed a capacity utilization factor of 50%. There is a wide variety of generally smaller
manufacturing sources included under this general source category. Based on comments we
received on the proposed GHG tailoring rule, we are using a 50% capacity utilization rate for this
final analysis to better reflect what can be deemed reasonable operation under normal conditions
for facilities in these source categories. Sources may operate their combustion equipment at
levels above and below this capacity utilization rate, but we believe the 50% utilization rate
reflects a reasonable average rate across the variety of facilities represented in this category.
New Units
EPA applied industry-specific growth rates to each sector and summed across sectors in
order to determine number of new units.
Threshold Summary
19
-------
Table 10
COie Threshold Summary ~ Unspecified Industrial Stationary Combustion
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
172,142
112,659
64,535
20,785
12,215
5,875
3,272
958
Number of New
Facilities Added
per Year
546
319
239
83
61
18
12
2
CO2e Emissions
Covered
(Tg per year)
372.307
367.636
357.855
318.759
289.198
245.579
206.881
145.106
3.6 Methodology for Existing Specific Industrial Sectors Considering Combustion,
Process, and Fugitive Emissions
These analyses were based primarily on the GHG MRR TSDs and the supporting
analyses, including facility specific emission information. The estimates considered each
greenhouse gas separately. The GHG MRR TSDs included threshold counts and emissions
calculations for 1,000, 10,000, 25,000, and 100,000 metric tons per year. Two steps were
required for permit threshold consideration. First, emissions were recalculated in order to
conduct the analysis in short tons for comparison to the permit thresholds. Second, the emissions
were considered against the finer threshold stratification considered in the permit threshold
analysis.
For the permit threshold analysis, EPA determined that if the GHG MRR analysis
showed all of the establishments exceeded a threshold, after adjustment for short tons, all of the
establishments exceeded any lower thresholds. However, where fewer than 100 percent of the
establishments exceeded a threshold, additional analysis was required to compare emissions to
the permit thresholds of 100, 250, 5,000, and 50,000 tons per year. EPA used the supporting
summaries for the GHG MRR which included facility-specific consumption, process, and
fugitive emission reports in order to determine counts and emissions for each of the permit
thresholds.
20
-------
3.6.1 Adipic Acid Production
There are four Adipic Acid Production plants in the U.S., all of which are estimated to
exceed the highest 100,000 metric tons per year emission threshold for CC^e on an actual
emissions basis. Therefore all plants will also exceed all PTE thresholds on a CC^e basis. The
CO26 emission estimate includes N2O process emissions that total about 5.9 million metric tons
CO26, and 3.4 million metric tons of CC>2 from stationary fuel combustion sources.
N2O
Individual plant production and emission estimates were not made available because of
confidential business information (CBI) claims. However, from the Technical Support
Document for the Adipic Acid Production Sector: Proposed Rule for Mandatory Reporting of
Greenhouse Gases (EPA-HQ-OAR-2008-0508-0005), overall U.S. adipic acid production was
estimated to total approximately one million metric tons in 2006. The smallest U.S. plant only
produced about two percent of the total. This plant, however, is the only plant that is
uncontrolled. The three larger plants with the bulk of production have control equipment with
N2O control efficiencies that range from 90 to 99 percent.
The uncontrolled N2O emission factor is 300 kg N2O/mton adipic acid. Based on the two
percent production share, this uncontrolled plant emitted about 6,000 metric tons of N2O (no
GWP adjustment). This leaves about 13,100 metric tons of N2O from the three larger controlled
plants. Two plants representing about 64 percent of production have control efficiencies in the
range of 90 to 95 percent, and one plant with about 34 percent of production has control close to
99 percent (EPA, 2001).
Assuming similar production shares today, the share of national production (which is
assumed for this analysis to be equivalent to capacity) appears to range from 30 to 35 percent for
the three plants. Therefore, emissions and PTE for the controlled plants range from to 4,000
metric tons to 4,700 metric tons of N2O per year.
CO2
The CO2 emissions from fuel combustion can similarly be apportioned to the four plants.
The smallest plant, with only two percent of national production, is estimated at CC>2 emissions
of 67,500 metric tons, and the next smallest, with 30 percent of national production, is estimated
at 101,300 metric tons.
Potential to Emit
The PTE for each facility was assumed to be equivalent to the emissions based on the
apportionment described above.
New Units
EPA assumed that no new plants would be constructed for this sector.
21
-------
Threshold Summary
Table 11
COi Threshold Summary ~ Adipic Acid Production
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
4
4
4
4
4
4
4
o
J
Number of New
Facilities Added
per Year
0
0
0
0
0
0
0
0
CO2 Emissions
Covered
(Tg per year)
3.376
3.376
3.376
3.376
3.376
3.376
3.376
3.309
Table 12
Threshold Summary ~ Adipic Acid Production
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
4
4
4
1
0
0
0
0
Number of New
Facilities Added
per Year
0
0
0
0
0
0
0
0
N2O Emissions
Covered
(Tg per year)
0.019
0.019
0.019
0.006
0
0
0
0
22
-------
Table 13
COie Threshold Summary ~ Adipic Acid Production
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
4
4
4
4
4
4
4
4
Number of New
Facilities Added
per Year
0
0
0
0
0
0
0
0
CO2e Emissions
Covered
(Tg per year)
9.298
9.298
9.298
9.298
9.298
9.298
9.298
9.298
>.6.2 Aluminum Production
The primary aluminum production process results in emissions of CC>2 and PFCs. The
reduction of the alumina occurs through electrolysis in a molten bath of natural or synthetic
cryolite (NasAlFe). The reduction cells contain a carbon lining that serves as the cathode.
Carbon is also contained in the anode, which can be a carbon mass of paste, coke briquettes, or
prebaked carbon blocks from petroleum coke. During reduction, most of the carbon in the anode
is oxidized and released to the atmosphere as CC>2.
Potential to Emit
C02
The Technical Support Document for Process Emissions from Primary Production of
Aluminum: Proposed Rule for Mandatory Reporting of Greenhouse Gases (EPA-HQ-OAR-
2008-0508-0006) apportioned CC>2 emission estimates from the U.S. GHG inventory to the 13
operating smelters based on each smelters share of total capacity. Operating smelter emissions
were all above 100,000 tons of CC>2, so no PTE estimate was required. Capacity information for
the two idle smelters shows that these smelters are also capable of emitting over 100,000 tons of
CC>2 per year.
PFCs
The reduction cells also emit two PFCs: perfluoromethane (CF4) and perfluoroethane
(C2F6). The GWPs of the two PFCs are 6,500 and 9,200 respectively. During the smelting
23
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process, when the alumina ore content of the electrolytic bath falls below critical levels required
for electrolysis, rapid voltage increases occur, which are termed "anode effects." Anode effects
cause carbon from the anode and fluorine from the dissociated molten cryolite bath to combine,
and produce fugitive emissions of CF4 and C2F6.
Anode effects released approximately 2.5 million metric tons of CF4 and C2p6in 2006 as
documented in the GHG MRR TSD. CF4 made up at least 85 percent of the combined emissions
in 2006 (Inventory of U.S. GHG Emissions and Sinks: 1990 - 2007). These emissions on a
CO26 basis are equivalent to about 410 short tons of combined emissions as PFC. The proposed
GHG MRR TSD estimated CC^e emissions from primary aluminum smelters at full capacity.
The largest smelter has 11 percent of U.S. operating capacity. Therefore the largest smelter has a
PTE of not more than 45 tons of PFC, and no facilities have a PTE greater than 100 tons.
New Units
No new primary aluminum facilities are expected to be built. The growth rate in primary
metals from the Economic Census data is only about 0.4 percent.
Threshold Summary
Threshold summaries are displayed below for CC>2 and CC^e. All facilities have a PFC
PTE less than 100 tons per year on a PFC basis.
Table 14
COi Threshold Summary ~ Primary Aluminum
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
15
15
15
15
15
15
15
15
Number of New
Facilities Added
per Year
0
0
0
0
0
0
0
0
GHG Emissions
Covered
(Tg per year)
3.800
3.800
3.800
3.800
3.800
3.800
3.800
3.800
24
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Table 15
Threshold Summary ~ Primary Aluminum
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
15
15
15
15
15
15
15
15
Number of New
Facilities Added
per Year
0
0
0
0
0
0
0
0
GHG Emissions
Covered
(Tg per year)
3.951
3.951
3.951
3.951
3.951
3.951
3.951
3.951
3.6.3 Ammonia Production
EPA reviewed the proposed Supporting Data for Threshold Analysis Subpart E- W,
Greenhouse Gas Mandatory Reporting Rulemaking, March 10, 2009 (EPA-HQ-OAR-2008-
0508-0046.7) to determine actual emissions and calculate the potential to emit for 24 ammonia
plants in operation. The analysis spreadsheet details CC>2 actual emission calculations for each
plant based on ammonia production and urea production, and CO2, CH4, and N2O emission
calculations for stationary fuel combustion based on 2006 data. For purposes of permit threshold
analysis, the CH4 and N2O emissions from combustion were not significant.
Potential to Emit
Capacity information in the spreadsheet is based on the engineering design capacity
adjusted for 340 days per year of effective production capability, using information provided by
the United States Geological Survey (USGS). The PTE estimates were made by multiplying the
actual emission estimates by the ratio of annual ammonia capacity to annual ammonia
production adjusted to 365 days a year of operation instead of 340. EPA assumed that ratio also
held for stationary combustion units at the plant.
New Units
EPA assumed that no new plants would be constructed for this sector.
25
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Threshold Summary
Table 16
Threshold Summary — Ammonia Production
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
24
24
24
24
24
24
24
22
Number of New
Facilities Added
per Year
0
0
0
0
0
0
0
0
CO2e Emissions
Covered
(Tg per year)
14.543
14.543
14.543
14.543
14.543
14.543
14.543
14.540
3.6.4 Cement Production
Process-related CC>2 emissions from cement production are the second largest source of
industrial CC>2 emissions in the United States. Cement production is done in two stages. The
first stage is clinker production. In clinker production, raw materials (primarily limestone) are
heated to induce calcination and produce lime. Lime reacts with silica-containing materials and
iron ore and aluminum to form clinker. During the process, CC>2 is generated as a byproduct and
released to the atmosphere. Also during clinker production, some of the clinker raw materials
form partially or fully calcinated cement kiln dust instead of forming clinker, resulting in
additional process-related CO2 emissions. In the second stage of the production process, the
clinker is ground and mixed with gypsum and other materials to make cement.
Potential to Emit
The Technical Support Document for Process Emissions from Cement: Proposed Rule
for Mandatory Reporting of Greenhouse Gases (EPA-HQ-OAR-2008-0508-0008) shows 107
cement facilities in the U.S., 106 of which exceed all permit thresholds for CC>2 (according to the
TSD, the one facility that does not exceed the 100,000 tons per year threshold accounted for over
90,000 metric tons of CC^e and approximately one-tenth of one percent of the cement industry
emissions in 2006).
26
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New Units
Growth for the industrial sector was estimated at 0.4 percent, and as such, no additional
facilities were included in this analysis.
Threshold Summary
Table 17
COie Threshold Summary — Cement Production
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
107
107
107
107
107
107
107
106
Number of New
Facilities Added
per Year
0
0
0
0
0
0
0
0
CO2e Emissions
Covered
(Tg per year)
86.83
86.83
86.83
86.83
86.83
86.83
86.83
86.74
3.6.5 Electronic Production
The Technical Support Document for Process Emissions from Electronics Manufacture
(Semiconductors, MEMs, Liquid Crystal Displays, and Photovoltaics) (EPA-HQ-OAR-2008-
0508-0009) examined emissions of high GWP gases for semiconductor and related industry
plants. Emissions from stationary fuel combustion were not included in the source category
analysis, but were instead captured by the unspecified industrial stationary combustion analysis.
EPA has followed this approach here as well.
Approximately one million metric tons of SFe as CC^e were emitted from the
semiconductor industry in 2006 (Inventory of U.S. Greenhouse Gas Emissions and Sinks: 1990
- 2007). This is equivalent to 46 short tons of SFe. The semiconductor industry uses multiple
long-lived fluorinated gases in plasma etching and plasma enhanced chemical vapor deposition
(PECVD) processes to produce semiconductor products. These include PFCs, which are also
used as heat transfer fluids. Approximately 3.5 million metric tons of PFCs as CC^e were
emitted from the semiconductor industry in 2006 (Inventory of U.S. Greenhouse Gas Emissions
and Sinks: 1990-2007).
27
-------
Table 18
Electronic Production PFC Emissions
Semiconductor PFC
CF4
C2F6
C4F8
Total
2006 CO2e Emissions
(million nitons)
1.2
2.2
0.1
3.5
PFC GWP
6,500
9,200
8,700
-
2006 PFC Emissions
(tons)
204
264
13
481
Potential to Emit
The Federal Reserve capacity utilization factor for the electronics industry in 2006 was
79.8 percent. Based on this capacity utilization factor the PTE of all of the semiconductor plants
combined is estimated at 56 tons of SFe and 600 tons of PFC.
EPA identified 216 facilities in the semiconductor-electronics sector. Of these, the
largest facility emitted six percent of total semiconductor emissions on a CC^e basis (includes
non-PFCs), which is a maximum of 30 tons of PFC. On a PTE basis, the largest facility would
emit 36 tons, based on an assumption that the industry capacity is distributed similarly to
emissions. Therefore no facility exceeds 100 tons per year on an actual or PTE basis for PFC.
New Units
Growth for the industrial sector was estimated at -1.8 percent, and as such, no additional
facilities were included in this analysis.
Threshold Summary
Electronics industry emissions from plant processes only exceed emission thresholds on a
CO26 basis. Facility stationary fuel combustion emissions are not included in the threshold
comparisons for the industry.
28
-------
Table 19
COie Threshold Summary ~ Electronics Production
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
199
191
159
109
88
65
54
22
Number of New
Facilities Added
per Year
0
0
0
0
0
0
0
0
CO2e Emissions
Covered
(Tg per year)
5.948
5.947
5.934
5.819
5.701
5.399
5.100
3.417
'1.6.6 Ethanol Production
In the proposed GHG MRR, EPA determined that the sources of GHG emissions at
ethanol production facilities that must be reported under the proposed rule are stationary fuel
combustion, onsite landfills, and onsite wastewater treatment. For the GHG MRR supporting
analysis, data were unavailable to estimate facility emissions from these combined sources.
Instead, data on stationary fuel combustion requirements for different plant capacities were used
to estimate the minimum number of facilities that would meet each of the examined reporting
rule facility-level thresholds. CC>2 emissions from combustion constitute the majority of the
GHG emissions from ethanol production and therefore provide an adequate measure for
determining threshold counts.
29
-------
Table 20
Ethanol Fuel Combustion COie Emissions by Plant Size
(from the Proposed GHG MRR TSD Spreadsheet)
Ethanol Produced
(wet milling process)
(million gallons)
290
245
200
200
100
85
40
35
20
2.6
Coal Combustion Emissions
(nitons CO2e/year)
1,519,585
1,283,787
1,047,990
1,047,990
523,995
445,396
209,598
183,398
104,799
13,624
Natural Gas Combustion
Emissions
(nitons CO2e/year)
853,536
721,091
588,646
588,646
294,323
250,174
117,729
103,013
58,865
7,652
Table 21
Proposed Reporting Rule Threshold Analysis Results
Threshold CO2e
(tons per year)
1,000
10,000
25,000
100,000
Number of Existing
Sources ~ Actual Basis
101
93
86
43
Percent of Existing
National Sources*
72%
66%
61%
31%
National ethanol production source population was estimated at 140 plants nationwide.
Potential to Emit
The permit threshold PTE analysis relied on this same approach and data. Therefore CH4
emissions from onsite landfills and wastewater treatment plant digesters were not included in the
PTE analysis, and we did not estimate emission coverage at each threshold. Also, the analysis
for the proposed GHG MRR did not evaluate thresholds of 100, 250, 5,000, and 50,000 tons per
year. EPA assumed that all existing plants would exceed the 100 and 250 ton per year thresholds
30
-------
based on fuel combustion associated with the wet milling process. For the 5,000 and 50,000
thresholds, EPA included the number of sources exceeding the next highest threshold. For
example, the count of sources exceeding the 5,000 tons per year level only includes the sources
exceeding the 10,000 ton threshold in the Technical Support Document for Ethanol Facilities:
Proposed Rule for Mandatory Reporting of Greenhouse Gases (EPA-HQ-OAR-2008-0508-
0010).
New Units
EPA estimates that ten new ethanol production facilities will be built per year.
Threshold Summary
Table 22
Threshold Summary ~ Ethanol
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
140
140
101
101
93
86
86
43
Number of New
Sources Added
per Year
10
10
7
7
7
6
6
3
3.6.7 Ferroalloy Production
In evaluating ferroalloy production in the U.S., EPA considered actual production at six
facilities, as published in the U.S. Inventory of Greenhouse Gas Emissions and Sinks: 1990 -
2007 for 2006, and the capacity to produce at three facilities for which production information
was not published due to competitive concerns.
Potential to Emit
EPA's PTE calculations consider the Federal Reserve's 2006 monthly industrial capacity
utilization estimates for the primary metals industry classification which shows utilization at 85.9
-------
percent for 2006. The PTE calculations do not affect the threshold analysis, because all facilities
emit over 100,000 metric tons of CC^e per year.
New Units
Applying the growth factor for the industrial sector, 0.4 percent, results in no additional
facilities for the analysis.
Threshold Summary
Table 23
Threshold Summary ~ Ferroalloy Production
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
9
9
9
9
9
9
9
9
Number of New
Facilities Added
per Year
0
0
0
0
0
0
0
0
CO2 Emissions
Covered
(Tg per year)
1.717
1.717
1.717
1.717
1.717
1.717
1.717
1.717
Table 24
CH4 Threshold Summary ~ Ferroalloy Production
GHG Threshold
(tons per year)
100
250
Number of
Existing Sources
o
5
0
Number of New
Facilities Added
per Year
0
0
CH4 Emissions
Covered
(Tg per year)
0.0003
0
32
-------
Table 25
COie Threshold Summary ~ Ferroalloy Production
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
9
9
9
9
9
9
9
9
Number of New
Facilities Added
per Year
0
0
0
0
0
0
0
0
CO2e Emissions
Covered
(Tg per year)
1.726
1.726
1.726
1.726
1.726
1.726
1.726
1.726
3.6.8 Food Processing
Food processing includes meat, poultry and fruit and vegetable processing. Emissions
derive from combustion and fugitive methane related to wastewater treatment. For purposes of
this permit threshold analysis, EPA did not consider the fugitive methane from wastewater
treatment because these are the only greenhouse gas emissions from the source category other
than combustion, and food processing is not a listed PSD source category. Consequently,
emissions from this subsector considered in this analysis were limited to combustion emissions
and were calculated using the MECS approach.
Potential to Emit
EPA used the Federal Reserve's 2004 capacity utilization factor of 79.3 percent for the
food industry to calculate PTE emissions.
New Units
In addition, new establishments were calculated assuming a continuation of the growth
rate of 1.2 percent, as calculated using the methodology described earlier in this document.
33
-------
Threshold Summary
Table 26
Threshold Summary — Food Processing
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
3946
2281
1499
1030
749
482
10
0
Number of New
Facilities Added
per Year
47
27
18
12
9
6
0
0
CO2e Emissions
Covered
(Tg per year)
16.848
16.709
16.379
15.723
14.354
12.257
0.596
0
3.6.9 Glass Manufacturing
EPA used the Supporting Data for Threshold Analysis Subpart E - W, Greenhouse Gas
Mandatory Reporting Rulemaking, March 10, 2009 (EPA-HQ-OAR-2008-0508-0046.7), to
analyze emissions for permit thresholds from glass manufacturing. Annual fuel combustion and
glass production are estimated for each plant based on 2004 estimated plant sales and 2002
MECS energy intensity (energy per sales dollars). The spreadsheet shows CC>2 emission
estimates from industrial processes and stationary fuel combustion, as well as CH4 and N2O
emission estimates from stationary fuel combustion.
Potential to Emit
Plant capacities are not available in the spreadsheet. To estimate PTE, EPA divided the
actual annual emissions by a capacity utilization factor of 0.50 or 50 percent.
New Units
EPA used an estimated annual growth rate of 0.4 percent for the nonmetallic mineral
product manufacturing sector to determine the number of new units for this analysis.
34
-------
Threshold Summary
Table 27
CO2e Threshold Summary ~ Glass Manufacturing
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
369
364
222
201
175
104
21
3
Number of New
Facilities Added
per Year
1
1
1
1
1
0
0
0
CO2e Emissions
Covered
(Tg per year)
4.425
4.425
4.341
4.302
4.162
3.277
1.208
0.366
3.6.10 HCFC-22 Production
Chlorodifluoromethane (HCFC-22) is produced for use in refrigeration and air
conditioning systems and as a chemical feedstock for manufacturing synthetic polymers.
Because HCFC-22 depletes stratospheric ozone, its production for non-feedstock uses is
scheduled to be phased out by 2020 under the U.S. Clean Air Act. Feedstock production,
however, is permitted to continue indefinitely.
A high global warming potential (GWP) greenhouse gas, trifluoromethane (HFC-23), is
generated as a byproduct during the manufacture of HCFC-22. Emissions of HFC-23 in 2006
were estimated to be 13.8 million metric tons on a CC^e basis from three HCFC-22 production
plants. Estimates were based on the plants operating at capacity. Annual emissions in terms of
both metric tons CC^e and tons HFC-23 are summarized in Table 30 below.
35
-------
Table 28
HCFC-22 Production HFC-23 Emissions
HCFC-22 Production
HFC-23
2006 CO2e Emissions
(million metric tons)
13.8
HFC GWP
11,700
2006 HFC
Emissions
(short tons)
1,300
Source: Reporting Rule TSD
Potential to Emit
Confidential business information (CBI) claims on production information limited EPA's
PTE analysis. The Technical Support Document for Emissions of HFC-23 from Production of
HCFC-22: Proposed Rule for Mandatory Reporting of Greenhouse Gases (EPA-HQ-OAR-
2008-0508-0015) estimated that all three plants emit over 100,000 metric tons CO2e on a
capacity basis by a factor of 85 or more, or a minimum of 800 short tons of HFC-23. These
estimates did not account for HFC-23 capture and destruction at two of the three plants.
Therefore, actual emissions at two of the plants will be lower, and can be limited through
permitting. We assumed that all three plants exceed the 100 and 250 ton actual and PTE
thresholds, and that one plant (uncontrolled) exceeds the 1,000 ton PTE threshold.
Because the TSD did not include estimates of CC>2 emissions from fuel combustion, and
the CBI claims noted above, the PTE analysis does not quantify fuel combustion emissions
specifically for the three plants. Stationary fuel combustion emissions from the plants were
instead captured under the analysis for unspecified industrial stationary combustion.
New Units
U.S. production between 1990 and 2006 increased by 11 percent while emissions
declined by 62 percent. The declines in emissions from control equipment and process changes
offset the production increases. Therefore we did not estimate any new facilities or
modifications that would increase facility emissions more than 100 tons per year.
36
-------
Threshold Summary
Table 29
HFC Threshold Summary - HCFC-22 Production
GHG Threshold
(tons per year)
100
250
1,000
5,000
Number of
Existing Sources
o
3
o
5
i
0
Number of New
Facilities Added
per Year
0
0
0
0
HFC Emissions
Covered
(Tg per year)
0.001
0.001
0.001
0
Table 30
CO2e Threshold Summary - HCFC-22 Production
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
3
3
o
J
3
o
J
3
3
o
J
Number of New
Facilities Added
per Year
0
0
0
0
0
0
0
0
CO2e Emissions
Covered
(Tg per year)
13.848
13.848
13.848
13.848
13.848
13.848
13.848
13.848
3.6.11 Hydrogen Production
EPA estimated CC>2 emissions from merchant hydrogen production using the process and
combustion ratio of 8.62 tons of CC>2 emissions per ton of hydrogen production. About 95
percent of all hydrogen (not just merchant hydrogen) produced in the U.S. today is made from
natural gas via steam methane reforming. In steam methane reforming fueled by natural gas
combustion, the process and combustion emissions go up the same stack from the
boiler/reformer unit. Because the emissions are predominately process emissions and because
37
-------
the natural gas combustion products are emitted from the same stack, EPA has treated all the
emissions as process emissions.
Potential to Emit
EPA developed estimates assuming hydrogen production at capacity level. Therefore, no
adjustment to the emissions estimates is needed to account for PTE emissions.
New Units
Based on the industry growth factor of-0.1 percent for chemical manufacturing, EPA
assumed that no new plants would be constructed.
Threshold Summary
Table 31
COi Threshold Summary — Hydrogen Production
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
75
75
74
62
51
42
38
32
Number of New
Facilities Added
per Year
0
0
0
0
0
0
0
0
CO2e Emissions
Covered
(Tg per year)
15.227
15.227
15.226
15.202
15.130
15.007
14.890
14.441
3.6.12 Iron and Steel Production
EPA used the Supporting Data for Threshold Analysis SubpartE- W, Greenhouse Gas
Mandatory Reporting Rulemaking, March 10, 2009 (EPA-HQ-OAR-2008-0508-0046.7) for the
proposed GHG MRR threshold analysis to determine process and combustion CO2 and process
CH4. The iron and steel production source category includes taconite iron ore processing
facilities, integrated iron and steel making facilities, electric arc furnace (EAF) steelmaking
facilities that are not located at integrated iron and steel facilities, and coke oven facilities that
38
-------
are not located at integrated iron and steel facilities. Facility processes and facilities covered in
the spreadsheet are shown in the table below.
Table 32
Iron and Steel Processes, Facilities, and Capacity Information
Iron and Steel Process
Basic oxygen furnace (EOF)
Blast Furnace (BF)
Sintering
Coke ovens
Electric arc furnace (EAF)
Taconite furnace
Integrated steel plant fuel combustion*
Coke oven gas combustion*
EAF steel plant fuel combustion
Number of Facilities
18
17
5
18
92
8
19
9
92
Capacity Information
Yes
Yes
Yes
Yes
No
Yes
No
No
No
* Six plants had emissions from coke oven gas combustion was included in integrated steel plant fuel
combustion.
Potential to Emit
The analysis covered 130 plants, and in all cases, except for EAF plants, GHG emissions
were estimated based on operations at plant capacity. For EAF plants, EPA used the 2007
Federal Reserve industrial capacity utilization percentage of 86.6 percent for primary metal —
iron and steel production, to adjust estimated actual emissions to PTE.
The spreadsheet contained emission CC^e estimates which included CC>2, CH4, and N2O
emissions. Process CFLt emissions were backed out of the CC^e totals using the process CFLt
emissions reported in the U.S. GHG Inventory, and apportioning these emissions to the different
plants based on their capacity in those processes. N2O emissions are primarily related to fuel
combustion and were not backed out for separate treatment.
New Units
No new iron and steel facilities are expected to be built. The growth rate in primary
metals from the Economic Census data is only about 0.4 percent.
39
-------
Threshold Summary
Table 33
CO2 Threshold Summary — Iron and Steel Production
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
130
130
130
129
128
123
116
113
Number of New
Facilities Added
per year
0
0
0
0
0
0
0
0
CO2 Emissions
Covered
(Tg per year)
85.150
85.150
85.150
85.148
85.141
85.057
84.831
84.655
Table 34
Threshold Summary — Iron and Steel Production
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
Number of
Existing Sources
18
17
17
3
0
Number of New
Facilities Added
per Year
0
0
0
0
0
CH4 Emissions
Covered
(Tg per year)
0.034
0.033
0.033
0.011
0
40
-------
Table 35
COie Threshold Summary ~ Iron and Steel Production
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
130
130
130
130
128
123
116
114
Number of New
Facilities Added
per Year
0
0
0
0
0
0
0
0
CO2e Emissions
Covered
(Tg per year)
85.151
85.151
85.151
85.151
85.141
85.058
84.832
84.656
3.6.13 Lead Production
According to the 2006 U.S. Geological Survey (USGS), lead production in the U.S.
includes both the primary, direct smelting (one facility) and secondary lead production (16
facilities). Process emissions of CC>2 are a byproduct of the coke consumed during the smelting
or reforming processes. EPA calculated total process emissions based on lead production as
reported in the USGS.
In the Supporting Data for Threshold Analysis SubpartE- W, Greenhouse Gas
Mandatory ReportingRulemaking (EPA-HQ-OAR-2008-0508-0046.7), combustion emissions
are combined with process emissions to determine total actual emissions.
Potential to Emit
In order to determine PTE emissions, EPA considered the Federal Reserve's 2006
monthly industrial capacity utilization estimates for primary metals industry classification which
shows utilization at 85.9 percent for 2006, and adjusted to achieve 100 percent utilization.
New Units
EPA assumed no new facilities would be added for the industry, given an expected
growth rate of 0.4 percent per year for primary metal manufacturing industry.
41
-------
Threshold Summary
Table 36
CO2e Threshold Summary ~ Lead Production
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
17
17
17
17
16
13
12
1
Number of New
Facilities Added
per Year
0
0
0
0
0
0
0
0
CO2e Emissions
Covered
(Tg per year)
0.861
0.861
0.861
0.861
0.855
0.799
0.761
0.089
3.6.14 Lime
The Supporting Data for Threshold Analysis Subpart E - W, Greenhouse Gas Mandatory
Reporting Rulemaking, March 10, 2009 (EPA-HQ-OAR-2008-0508-0046.7) was also used to
estimate GHG PTE for lime plants.
Potential to Emit
To estimate PTE, EPA divided annual actual CC>2 emissions from the calcining process
and fuel combustion emissions of CO2, CH4, and N2O by regional capacity factors available in
the spreadsheet for each plant. The capacity factors ranged from 43 to 136 percent.
New Units
EPA assumed no new facilities would be added for the industry.
42
-------
Threshold Summary
Table 37
Threshold Summary — Lime Production
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
89
89
89
89
89
86
66
60
Number of New
Facilities Added
per Year
0
0
0
0
0
0
0
0
CO2 Emissions
Covered
(Tg per year)
27.262
27.262
27.262
27.262
27.262
27.237
26.533
26.180
3.6.15 Magnesium Production and Processing
The magnesium metal production (primary and secondary) and casting industry typically
uses SF6 as a cover gas to prevent the rapid oxidation and burning of molten magnesium in the
presence of air. A dilute gaseous mixture of SFe with dry air and/or CC>2 is blown over molten
magnesium metal to induce and stabilize the formation of a protective crust. A small portion of
the SFe reacts with the magnesium to form a thin molecular film of mostly magnesium oxide and
magnesium fluoride. The amount of SF6 reacting in magnesium production and processing is
being studied but presently assumed to be negligible, and therefore all SFe used is assumed to be
emitted into the atmosphere.
For the proposed GHG MRR Technical Support Document for Process Emissions from
Magnesium Production and Processing: Proposed Rule for Mandatory Reporting of
Greenhouse Gases., EPA reported that national annual SF6 emissions from magnesium
production and processing totaled approximately 3.2 million metric tons CC^e in 2006. The
facility population totaled 13 facilities that emitted 3.0 million metric tons CC^e. The SF6
emissions (no GWP adjustment) were 148 and 138 short tons respectively. Ten magnesium die
casting facilities accounted for 29 percent (44 tons), and primary and secondary production
accounted for 64 percent (96 tons) of the total emissions. Other small casting activities
accounted for the remaining 7 percent (ten tons).
43
-------
Potential to Emit
EPA used the analysis in the TSD for the proposed GHG MRR, where EPA had
evaluated thresholds of 1,000, 10,000, 25,000, and 100,000 metric tons per year. Facility-level
information is not made publicly available because of confidential business information (CBI)
claims. From that earlier analysis EPA estimated that the same number of facilities exceeded the
100, 250, and 1,000 tons CO2e per year PTE threshold as determined in the GHG MRR TSD for
the 1,000 metric tons per year threshold. In a similar fashion, EPA used the GHG MRR TSD
facility counts at 10,000 metric tons CC^e per year to estimate facilities at the 5,000 tons per year
PTE threshold, and 100,000 metric tons per year for the 50,000 tons CC^e per year PTE
threshold. The permit threshold analysis did not include CC>2 emissions from fuel combustion.
That information was not available in the TSD for the proposed GHG MRR.
On an SF6 mass basis, the average emissions per facility are only 11 tons of SF6, well
below 100 tons per year. Therefore we assumed that none of the facilities have a potential to
emit more than 100 tons per year of SF6.
New Units
EPA assumed no new units would be added for the sector.
Threshold Summary
Table 38
COie Threshold Summary ~ Magnesium Production
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
13
13
13
11
11
11
9
9
Number of New
Facilities Added
per Year
0
0
0
0
0
0
0
0
CO2e Emissions
Covered
(Tg per year)
2.955
2.955
2.955
2.94
2.94
2.94
2.781
2.781
44
-------
3.6.16 Nitri c Aci d Product! on
EPA used the 2006 nameplate capacity (metric tons of HNOs 100 percent acid basis) for
45 nitric acid plants and 2006 acid production from the GHG MRR TSD supporting spreadsheet
(EPA-HQ-OAR-2008-0508-0046.7) to determine N2O emissions.
Potential to Emit
The GHG PTE was calculated by multiplying actual N2O emissions as CC^e by the ratio
of nameplate capacity to 2006 production. The permit threshold analysis, based on the GHG
MRR TSD, does not include GHG emissions from co-located stationary combustion units. Also
the permit threshold analysis does not account for overlap between facilities in the Nitric Acid
and Ammonia categories, which have both ammonia and nitric acid production processes.
New Units
EPA assumed no new units would be constructed for this sector.
Threshold Summary
Table 39
Threshold Summary ~ Nitric Acid Production
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
43
42
27
4
0
0
0
0
Number of New
Facilities Added
per Year
0
0
0
0
0
0
0
0
N2O Emissions
Covered
(Tg per year)
0.055
0.055
0.049
0.016
0
0
0
0
45
-------
Table 40
Threshold Summary ~ Nitric Acid Production
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
45
45
45
45
45
44
43
42
Number of New
Facilities Added
per Year
0
0
0
0
0
0
0
0
CO2e Emissions
Covered
(Tg per year)
17.732
17.732
17.732
17.732
17.732
17.724
17.706
17.667
>.6.17 Petrochemical Production
EPA determined that the portion of the petrochemical production sector most relevant for
permit threshold analysis includes the manufacture and production of acrylonitrile, carbon black,
ethylene, ethylene dichloride, ethylene oxide, and methanol, because the IPCC considers
production of greenhouse gases from these processes significant compared to other
petrochemical processes.
Emissions from the manufacturing processes vary significantly and process emissions
take many forms. Process emissions include direct oxidation of CC>2, off-gassing of CH4 and
CC>2, and the direct release of CC>2 and CH4 from equipment leaks. Process emissions are the
primary consideration for acrylonitrile, ethylene, and ethylene oxide processes. In addition,
some processes require combustion of supplemental fuel. Both process and combustion
emissions are significant for carbon black and methanol processes.
Potential to Emit
EPA's analysis assumed petrochemical production at the capacity level. Therefore, no
adjustment to the emissions estimates is needed to account for PTE.
New Units
Based on an industry growth factor of-0.1 percent for chemical manufacturing, EPA
assumed that no new plants would be constructed.
46
-------
Threshold Summary
Table 41
Threshold Summary ~ Petrochemical Production
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
98
98
98
97
96
96
94
91
Number of New
Facilities Added
per Year
0
0
0
0
0
0
0
0
CO2 Emissions
Covered
(Tg per year)
52.081
52.081
52.081
52.080
52.073
52.073
52.005
51.806
Table 42
CH4 Threshold Summary ~ Petrochemical Production
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
55
52
37
5
1
0
0
0
Number of New
Facilities Added
per Year
0
0
0
0
0
0
0
0
CH4 Emissions
Covered
(Tg per year)
0.130
0.129
0.121
0.035
0.010
0
0
0
47
-------
Table 43
Threshold Summary ~ Petrochemical Production
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
98
98
98
97
96
96
94
91
Number of New
Facilities Added
per Year
0
0
0
0
0
0
0
0
CO2e Emissions
Covered
(Tg per year)
54.826
54.826
54.826
54.825
54.818
54.818
54.748
54.595
3.6.18 Petroleum Refineries
In developing the permit threshold analysis for petroleum refineries, EPA quantified CH4
process emissions from wastewater, fugitive, flares, and storage tanks. Process CC>2 emissions
derived from flares, hydrogen plant emissions, and sulfur plant emissions. In addition, on-site
combustion emissions were calculated considering fuel consumed by type.
Potential to Emit
EPA assumed that petroleum refineries were operating at capacity level. Therefore, no
adjustment to the emissions estimates was needed to account for PTE.
New Units
According to the ICR prepared for the New Source Performance Standard (NSPS), EPA
expects that no new refineries will be built over the next few years.
48
-------
Threshold Summary
Table 44
Threshold Summary ~ Petroleum Refineries
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
150
150
150
150
149
146
137
129
Number of New
Facilities Added
per Year
0
0
0
0
0
0
0
0
CO2 Emissions
Covered
(Tg per year)
202.947
202.947
202.947
202.947
202.938
202.887
202.575
202.065
Table 45
CH4 Threshold Summary ~ Petroleum Refineries
GHG Threshold
(tons per year)
100
250
1,000
5,000
Number of
Existing Sources
129
109
31
0
Number of New
Facilities Added
per Year
0
0
0
0
CH4 Emissions
Covered
(Tg per year)
0.083
0.080
0.042
0
49
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Table 46
Threshold Summary ~ Petroleum Refineries
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
150
150
150
150
149
146
137
129
Number of New
Facilities Added
per Year
0
0
0
0
0
0
0
0
CO2e Emissions
Covered
(Tg per year)
204.897
204.897
204.897
204.897
204.888
204.835
204.513
203.988
i.6.19 Phosphoric Acid Production
Phosphoric acid is produced by combining sulfuric acid and phosphate rock. CC>2 is
emitted when the limestone component of phosphate rock reacts with the sulfuric acid.
Potential to Emit
When these process emissions are combined with combustion emissions, all 14 plants
have emissions that exceed the highest threshold level; consequently, no PTE analysis was
required.
New Units
Based on an industry growth factor of-0.1 percent for chemical manufacturing, EPA
assumed that no new plants would be constructed.
50
-------
Threshold Summary
Table 47
Threshold Summary ~ Phosphoric Acid Production
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
14
14
14
14
14
14
14
14
Number of New
Facilities Added
per Year
0
0
0
0
0
0
0
0
CO2e Emissions
Covered
(Tg per year)
3.838
3.838
3.838
3.838
3.838
3.838
3.838
3.838
3.6.20 Pulp and Paper Manufacturing
Permit threshold analysis for this sector is focused on the energy intensive, fugitive
emitting pulp, paper, and paperboard manufacturing subsectors. Process emissions include CC>2
which is emitted in the recovery cycle at kraft and soda facilities associated with the chemical
pulp process. The CC>2 emitted from kraft mill lime kilns originates from two sources: (1) fossil
fuels burned in the kiln; and (2) conversion of calcium carbonate (or "lime mud") generated in
the recovery process to calcium oxide.
The bulk of the emissions considered derive from combustion. Many boilers use biomass
fuel, and the burning of spent pulping liquors to produce steam for facility processes is
considered biomass combustion for the GHG MRR. The emissions numbers considered for the
permit threshold analysis are non-biogenic (net of any biogenic emissions). Considering only
non-biogenic emissions, 96.5 percent of the facilities and 99.7 percent of the emissions are
captured by all of the thresholds proposed for consideration of the permit threshold rule.
Potential to Emit
Because 99.7 percent of emissions were captured at even the highest threshold, no
additional PTE estimate was calculated in this analysis.
51
-------
New Units
Based on an industry growth factor of-2.5 percent for paper manufacturing, and previous
EPA analysis for the pulp and paper NSPS ICR, EPA assumed that no new plants would be
constructed.
Threshold Summary
Table 48
Threshold Summary — Pulp and Paper Manufacturing
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
425
425
425
425
425
425
422
410
Number of New
Facilities Added
per Year
0
0
0
0
0
0
0
0
CO2e Emissions
Covered
(Tg per year)
57.700
57.700
57.700
57.700
57.700
57.700
57.688
57.527
i.6.21 Silicon Carbide Manufacturing
In 2006, one facility produced silicon carbide in the U.S. Silicon carbide is primarily an
industrial abrasive manufactured from silica sand or quartz and petroleum coke. Approximately
35 percent of the carbon from the petroleum coke is retained with the silicon carbide, and the rest
is emitted as both CC>2 and CH4. In addition, emissions from combustion account for
approximately ten percent of total emissions.
Potential to Emit
Emissions from this plant exceed all permit threshold levels; as a result, EPA did not
consider PTE calculations.
New Units
EPA assumed there would be no new facilities constructed.
52
-------
Threshold Summary
Table 49
COi Threshold Summary ~ Silicon Carbide Manufacturing
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
1
1
1
1
1
1
1
1
Number of New
Facilities Added
per Year
0
0
0
0
0
0
0
0
CO2 Emissions
Covered
(Tg per year)
0.101
0.101
0.101
0.101
0.101
0.101
0.101
0.101
Table 50
CH4 Threshold Summary ~ Silicon Carbide Manufacturing
GHG Threshold
(tons per year)
100
250
1,000
Number of
Existing Sources
1
1
0
Number of New
Facilities Added
per Year
0
0
0
CH4 Emissions
Covered
(Tg per year)
0.0004
0.0004
0
53
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Table 51
COie Threshold Summary ~ Silicon Carbide Manufacturing
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
1
1
1
1
1
1
1
1
Number of New
Facilities Added
per Year
0
0
0
0
0
0
0
0
CO2e Emissions
Covered
(Tg per year)
0.109
0.109
0.109
0.109
0.109
0.109
0.109
0.109
3.6.22 Soda Ash Production
Soda Ash production emissions were nearly evenly split between process and combustion
emissions. Process emissions result from calcining trona ore to produce soda ash.
Potential to Emit
PTE emissions were calculated based on the capacities of the production units.
New Units
In 2006, there was a glut of soda ash in the domestic market; EPA assumed no new units
would be constructed.
54
-------
Threshold Summary
Table 52
CO2e Threshold Summary — Soda Ash Production
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
5
5
5
5
5
5
5
5
Number of New
Facilities Added
per Year
0
0
0
0
0
0
0
0
CO2e Emissions
Covered
(Tg per year)
3.121
3.121
3.121
3.121
3.121
3.121
3.121
3.121
3.6.23 Titanium Dioxide Production
EPA used USGS as the source for production capacity for the eight facilities that
produced titanium dioxide in 2006.
Potential to Emit
Emissions were assumed to represent PTE operating levels.
New Units
EPA assumed that no new plants would be constructed.
55
-------
Threshold Summary
Table 53
Threshold Summary ~ Titanium Dioxide Production
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
8
8
8
8
8
8
8
7
Number of New
Facilities Added
per Year
0
0
0
0
0
0
0
0
CO2e Emissions
Covered
(Tg per year)
3.686
3.686
3.686
3.686
3.686
3.686
3.686
3.628
3.6.24 Zinc Production
The Zinc production emissions and facility count estimates include process and
combustion emissions associated with primary smelting and secondary recycling facilities.
Potential to Emit
For PTE estimates, EPA considered the Federal Reserve's 2006 monthly industrial
capacity utilization estimates for primary metals industry classification which shows utilization
at 85.9 percent for 2006, and adjusted to achieve 100 percent utilization.
New Units
EPA assumed that no new units would be constructed.
56
-------
Threshold Summary
Table 54
Threshold Summary — Zinc Production
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
9
9
9
9
8
5
5
5
Number of New
Facilities Added
per Year
0
0
0
0
0
0
0
0
CO2e Emissions
Covered
(Tg per year)
0.852
0.852
0.852
0.852
0.843
0.802
0.802
0.802
3.7 Energy Sector
3.7.1 Oil and Gas Systems
In consideration of the permit thresholds, EPA considered the Fugitive Emissions
Reporting from the Petroleum and Natural Gas Industry: Background Technical Support
Document (EPA-HQ-OAR-2008-0508-0023). This document details combustion emissions and
fugitive emissions from offshore petroleum and natural gas facilities, onshore natural gas
processors, onshore natural gas transmission, underground natural gas storage, and liquid natural
gas storage. EPA determined that oil and gas exploration, development, transmission, and
distribution are not listed PSD source categories, and therefore fugitive emissions from these
activities were not considered for PSD applicability as it relates to major source thresholds.
EPA's analysis focused on combustion emissions from these sources.
Potential to Emit
EPA used a capacity utilization figure of 50 percent to determine PTE emission estimates
and counts. This rate is meant to reasonably represent an average utilization rate across a variety
of combustion equipment types used in the oil and gas industry subsectors described above.
New Units
57
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EPA determined new units based on a growth factor of 1.0 percent for the sector.
Threshold Summary
Table 55
Threshold Summary ~ Oil and Gas Systems
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
4762
4762
4762
3722
3095
2496
1045
387
Number of New
Facilities Added
per Year
48
48
48
37
31
25
10
4
CO2e Emissions
Covered
(Tg per year)
88.264
88.264
88.264
86.192
83.619
79.386
56.949
32.750
3.7.2 Underground Coal Mining
GHG emissions from underground coal mining include CH4 fugitive emissions released
from the coal seam and surrounding rock during mining and post-mining activities (coal bed
CH4), and fuel combustion emissions of CC>2, CH4, and N2O. Fugitive CH4, emissions are
captured and vented by ventilation systems and degassing systems. Captured and vented CH4
emissions from active mines were considered in the PTE analysis. Because underground coal
mining is not one of the 28 PSD source categories for which fugitive emissions were required to
be included in the emissions determination, fugitive emissions from post mining operations,
surface mines, and inactive mines were not included in the permit thresholds analysis.
The Technical Support Document for Under ground Coal Mines: Proposed Rule for
Mandatory Reporting of Greenhouse Gases (EPA-HQ-OAR-2008-0508-0032) identified 612
active underground coal mining facilities but analysis of CH4 emissions was limited to 128
"gassy" mines where CH4 monitoring was already in place (due to existing CH4 emissions above
Mine Safety and Health Administration (MSHA) threshold levels). The U.S. GHG Inventory
(EPA, 2008) reports that 233 underground coal mines (including 133 gassy mines) ventilated
CH4 in 2007. Fuel combustion emission estimates for the GHG MRR TSD from all underground
coal mines, based on U.S. Census energy use data, were found to comprise between one and
58
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three percent of total CC^e emissions, with coal bed CH4 accounting for the bulk of GHG
emissions.
In addition to the emissions data on the 128 gassy mines contained in the GHG MRR
TSD, EPA considered combustion emissions from 289 bituminous underground coal mines,
using U.S. Census data from 2002.
Potential to Emit
CH4
CH4 emission estimates that were developed for the GHG MRR TSD were used for both
actual emissions and PTE emissions permit threshold analysis. EPA assumed that venting and
degassing were continuous throughout the year; therefore, actual emission estimates equal PTE
emission estimates. The estimates considered 128 gassy mines, which were assumed to be the
largest emitters of vented CH4. The smallest mine of this group had annual CH4 emissions of 26
tons; therefore EPA assumed that the annual CH4 emissions from the 105 vented mines that were
not included in the TSD analysis were less than 26 tons.
CO2
CC>2 emissions were estimated in the same manner as for other Unspecified Industrial
Stationary Combustion categories, based on the ICF analysis (ICF, 2007) using the MECS
approach. Emissions were estimated based on Census information including fuel consumption
per employee and the distribution of establishments by the number of employees. PTE was
estimated by using a capacity utilization factor of 86.3 percent as published by the Federal
Reserve.
New Units
The number of underground bituminous coal mines in the U.S. is on the decline. EIA
data show that only Colorado had an increase in the number of underground coal mines between
2006 and 2007 (EIA, 2008). The EIA data show that overall the number of underground coal
mines decreased from 2006 to 2007 by eight percent; consequently, EPA assumed no new
underground mines would be built, http://www.eia.doe.gov/cneaf/coal/page/acr/table 1 .html.
59
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Threshold Summaries
Threshold summary tables are shown below for CJLt (vented fugitive emissions), CC>2
(fuel combustion), and CO2e (vented fugitive CH4 and combustion CO2).
Table 56
COi Threshold Summary — Underground Coal Mining
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
Number of
Existing Sources
238
202
63
30
30
0
Number of New
Facilities Added
per Year
0
0
0
0
0
0
CO2e Emissions
Covered
(Tg per year)
0.783
0.778
0.692
0.577
0.577
0
Table 57
CH4 Threshold Summary — Underground Coal Mining
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
110
110
110
53
38
24
13
1
Number of New
Facilities Added
per Year
0
0
0
0
0
0
0
0
CO2e Emissions
Covered
(Tg per year)
1.586
1.586
1.586
1.420
1.361
1.147
0.784
0.105
60
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Table 58
Threshold Summary — Underground Coal Mining
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
238
238
126
124
123
103
78
55
Number of New
Facilities Added
per Year
0
0
0
0
0
0
0
0
CO2e Emissions
Covered
(Tg per year)
39.520
39.520
33.945
33.943
33.936
33.606
32.800
31.241
3.8 Waste Sector
5.8.1 Landfills
The landfill PTE analysis includes both municipal solid waste (MSW) landfills and onsite
industrial landfills associated with pulp and paper and food processing. The analysis used a
modification of the landfill emission modeling approach used for the proposed GHG MRR
threshold analysis. Like the GHG MRR analysis, the permit threshold PTE analysis did not
include onsite industrial landfills for ethanol processing facilities or industrial land application
systems.
GHG Emissions
Decomposition of waste in landfills generates CH4 and CC>2. The amount of CH4
generated from a given landfill is a function of several factors: the total amount of waste
disposed in the landfill; the characteristics of the waste; and the climatic conditions. The amount
of CfL; emitted is the amount of CfL; generated minus the amount of CfL oxidized by aerobic
microorganisms in the landfill cover material. Also subtracted from the total is the amount of
CH4 that is destroyed by combustion of the vented gas. The CC>2 produced by decaying waste is
not considered an anthropogenic emission, and is not counted in GHG emission totals. Likewise,
CC>2 resulting from the combustion of landfill CH4 is not accounted for as an anthropogenic
emission under international accounting guidance.
61
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According to the 2008 U.S. Inventory, MSW landfills emitted 111.2 million metric tons
CH4 (CO26 basis) in 2006. The majority of the CH4 emissions from on-site industrial landfills
occurs at pulp and paper facilities and food processing facilities. In 2006, these landfills emitted
14.6 million metric tons CC^e
Potential to Emit
The methodology used for the proposed GHG MRR threshold analysis was also used to
estimate CH4 generation rates and emissions in 2006 for the PTE analysis. A landfill-specific
model developed by EPA to support its proposed GHG MRR was used to estimate CH4
generation and potential generation from municipal landfills. The generation estimate was
adjusted with assumptions on oxidation in landfill cover, and destruction by combustion for
energy recovery or flaring. The industrial landfill generation and emission estimates are based
on the U.S. GHG Inventory. Industrial landfills were assumed not to have energy recovery or
flaring, so there was no difference between generation and emissions.
New Units
EPA did not estimate the number of new facilities added each year with CH4 emissions
above the different thresholds due to the time delay between landfill construction and emission
generation.
Threshold Summary
Table 59
Threshold Summary ~ Landfills
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
4,131
4,117
4,053
3,564
3,265
2,701
1,684
967
CO2e Emissions
Covered
(Tg per year)
125.621
125.619
125.592
124.552
122.788
115.937
92.340
72.722
62
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Table 60
CH4 Threshold Summary ~ Landfills
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
3,885
3,562
2,692
981
427
114
21
2
CH4 Emissions
Covered
(Tg per year)
5.973
5.931
5.539
3.274
2.326
1.087
0.401
0.106
i.8.2 Municipal Solid Waste Combustors
The threshold analysis for the proposed GHG MRR included municipal solid waste
combustors (MWC) in the general stationary fuel combustion category. The analysis used the
eGRID database, which is discussed in the PTE methodology description for electric generating
units.
Data and Methodology
EPA used the latest version of the eGRID database (2006) to estimate the PTE of MWC
facilities and counts of facilities above the different emission thresholds. The eGRID database
includes year 2004 characteristics, operating information, and annual CC>2 emissions for U.S.
facilities that have a generation capacity greater than one MW and sell electric power to the grid.
By using eGRID, EPA assumed that all MWC facilities sell power to the grid.
Potential to Emit
EPA identified 75 MWC facilities based on the generator primary fuel in the generator
table (primary fuel equals MSW) in the eGRID database. The eGRID database contains CC>2
annual emissions estimates for the facilities. For CC>2 emissions, eGRID uses a standard
assumption that 70 percent of the heat value of the waste stream comes from renewable materials
and 30 percent comes from nonrenewable materials. The renewable fraction has a CC>2 emission
rate of zero; therefore, the PTE threshold analysis is based on the nonrenewable or fossil fraction
assumption. EPA estimated PTE by dividing the annual emissions from eGRID by the eGRID
plant capacity factor.
63
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New Units
To determine the number of new per year at different thresholds, EPA counted the
number of generators online each year, and totaled the nameplate capacity for each online year.
This information was compared to the total facility nameplate capacity, and the PTE for the
increased capacity was calculated by multiplying the facility PTE by the fraction of nameplate
capacity associated with the new generators. EPA counted the facilities that exceeded the PTE
thresholds during each period, and computed a 15-year average to determine the number of new
or modified facilities per year.
Threshold Summary
Table 61
COi Threshold Summary ~ Municipal Solid Waste Combustors -
GHG Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
75
75
75
75
75
74
67
40
Number of New
Facilities Added
per Year
2
2
2
2
2
2
1
1
CO2 Emissions
Covered
(Tg per year)
6.255
6.255
6.255
6.255
6.255
6.24
6.071
4.958
3.9 Agriculture (Stationary Fuel Combustion)
The analysis for the Agriculture sector was limited to stationary fuel combustion CC>2
emissions from internal combustion diesel engine generators. Fugitive emissions of CH4 from
enteric fermentation, and CC>2, CH/t, and N2O from manure management were not included
because farms and related operations are not in the 28 PSD source categories that require
quantification of fugitive emission PTE for determining major source status, and because of the
large uncertainties and lack of information on determining what component of the non-
combustion emissions at agricultural operations would be defined as non-fugitive for PSD
purposes. Fuel combustion for building space heating and other farm purposes were not
included in the estimates, but would be a component of farm PTE.
64
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Data and Methodology
EPA used the 2007 ICF analysis to estimate the number of farms covered by the different
thresholds (ICF, 2007). Emissions from diesel generators on farms were estimated using data on
the average generator size in Delaware (EEA, 2004), and data on energy use on farms for non-
transport/non-machinery motors (Brown and Neal 2005). Using these data, EPA estimated the
number of diesel generators on farms and apportioned the generators across farm sizes, assuming
no farm has more than one generator.
Potential to Emit
EPA assumed that a high proportion of farms would run the generators infrequently, and
a smaller proportion would have a generator as the only power source, requiring nearly constant
operation. EPA used this distribution to determine actual and potential emissions, with PTE
emissions based on the assumption that the generators ran 24 hours per day, 365 days per year.
EPA recognizes that this approach underestimates the PTE for all farm stationary fuel
combustion sources, because it is limited to diesel engine generators used primarily to run pumps
and motors, and does not include additional sources such as fuel combustion for drying and
curing, space heating, and water heating.
New Units
New generator installations were estimated based on information in the Regulatory
Impact Analysis (RIA) for the spark ignition stationary combustion engine NSPS and area
NESHAPS (EPA, 2007). The on-farm engine population of diesel generators used for irrigation
increased four percent between 1998 and 2003, or about 0.8 percent annually.
65
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Threshold Summary
Table 62
CO2 Threshold Summary ~ Farm Stationary 1C Engines
CO2 Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
37,351
37,351
0
0
0
0
0
0
Number of New
Engines Added
per Year
299
299
0
0
0
0
0
0
CO2 Emissions
Covered
(Tg per year)
0.512
0.512
0
0
0
0
0
0
3.10 Commercial Stationary Fuel Combustion
Data Source
EPA used EIA's Commercial Building Energy Consumption Survey (CBECS) to estimate
commercial sector stationary fuel combustion GHG emissions and PTE. CBECS is a national
sample survey that collects information on the stock of U.S. commercial buildings, their energy-
related building characteristics, and their energy consumption and expenditures. Commercial
buildings include all buildings in which at least half of the floor space is used for a purpose that
is not residential, industrial, or agricultural; thus, the source category includes building types that
might not traditionally be considered "commercial," such as schools, correctional institutions,
and buildings used for religious worship. The CBECS survey is conducted every four years and
the most recent survey was completed for 2003.
The CBECS survey sample was designed so that survey responses could be used to
estimate characteristics of the entire nationwide commercial building stock. The 2003 survey
selected 6,955 potential case buildings for sampling. The sampling procedures resulted in 5,215
completed building interviews for a response rate of 82 percent. To make national estimates
from the sample data, EIA calculated base sampling weights for each building (the reciprocal of
the probability of that building being selected into the sample). In other words, the base
sampling weight is the number of national buildings represented by the sampled building. The
base weight was further adjusted to account for nonresponsive bias.
66
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EIA publishes summary tables from the survey, and posts "microdata" files on the EIA
website. The CBECS microdata consist of the 5,215 sampled building records, which each
correspond to a single sampled building. For each building, these files contain information such
as the building size, climatic region, census region, year constructed, types of energy used, and
energy consumption and expenditures. These individual building microdata records are also the
basis for the summary tables published by EIA.
Emissions Methodology
EPA used the CBECS microdata to estimate commercial building emissions and
populations above emission thresholds. Each of the 5,215 microdata records corresponds to a
single sampled building. EIA has made available 20 different data files of the microdata records
which contain a wide range of information on characteristics and energy use for each building.
EPA's analysis relied on guidance provided by EIA on how to use the data. As noted
above, the CBECS sample was designed so that survey responses could be used to estimate
characteristics of the entire commercial building stock nationwide. The table below provides
examples from EIA on how to calculate national commercial building characteristics from the
sample building data.
Table 63
EIA Website Examples
To Find the National
Estimate for:
Total number of buildings
Total number of office
buildings
Total floor space
Total floor space in
buildings with air
conditioning
Total electricity
consumption in KWh
Do This...
Sum ADJWT8 (weight factor)
Sum ADJWT8 for cases where PBA8 (building code) = "02"
Create a new variable (weighted square footage) by
multiplying ADJWT8 by SQFT8 (floor space) for each case,
then sum this new variable
Sum the new weighted square footage variable (see above)
for cases where COOLS (air conditioning) = "1"
Create a new variable (weighted electricity consumption) by
multiplying ADJWT8 by ELCNS8 (electricity consumption)
for each case, then sum this new variable
And You
Should Get...
4,858,749.82
(or 4,859 thousand)
823,805.47
(or 824 thousand)
71,657,900,522
(or 7 1,658 million ft2)
63,559,999,624
(or 63,560 million ft2)
1,043,175,710,751
(or 1,043 billion kWh)
Source: http://www.eia.doe.gov/emeu/cbecs/cbecs2003/public use 2003/cbecs pudata2003.html.
EIA calculated base sampling weights for each surveyed building (these are the
reciprocal of the probability of that building being selected into the sample). Therefore, a
building with a base weight of 1,000 represents itself and 999 similar but unsampled buildings in
67
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the total building stock. The base weight is further adjusted to account for non-response bias.
The variable "ADJWT8" in the data file is the final weight. The ADJWT8 weight factor is used
as described in Table 63 to extrapolate the survey sample to a national scale for any value. In
order to obtain a national value each sample building's value must be multiplied by the building's
weight (ADJWT8). All of the weighted values are then summed.
2003 CO2 Emissions
EPA calculated the CC>2 emissions for each of the 5,215 buildings based on the annual
natural gas and oil consumption reported for the building. For national emission estimates and
counts of buildings with annual CC>2 emissions over any threshold, EPA multiplied the base
weights by the sample emission totals to determine the national estimate of buildings with
emissions over the threshold.
Potential to Emit
EPA estimates that commercial buildings operate at 15 percent of capacity. EPA
considered several sources in making the PTE factor determination:
• A report prepared by Energy and Environmental Analysis, Inc. for Oak Ridge National
Laboratory describing the industrial and commercial boiler population in the United
States (EEA, 2005). The report estimated an average commercial boiler capacity factor
of 16 percent.
• Reports on cooking equipment energy use by the Food Service Technology Center in
California suggesting that the cooking equipment in food service establishments operate
at about ten percent of a theoretical maximum capacity based on 8,760 hours per year
(Pechan, et.al, 2008).
• A study of Los Angeles dry cleaners performed by the Pollution Prevention Education
and Research Center (PPERC) in 2004 which demonstrates that dry cleaners operate
boilers at about 10 to 15 percent of maximum capacity over a normal year (Pechan, et al.,
2008).
New Buildings
The CBECS data identifies the year the sampled buildings were constructed. We used
the construction year information to identify the number of new buildings built each year in the
1990 to 2003 period. Counts of the average number of these buildings built per year were then
made at the different emissions and PTE thresholds.
Threshold Summary
The count of buildings and emissions at the threshold levels for the entire sector are
shown in the table below. Threshold results by commercial building categories (e.g., offices,
public assembly, schools) are provided in Appendix B.
68
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Table 64
COi Threshold Summary — Commercial Sector Stationary Fuel Combustion
CO2 Threshold
(tons per year)
100
250
1,000
5,000
10,000
25,000
50,000
100,000
Number of
Existing Sources
1,355,921
731,477
172,654
18,167
5,660
1,161
600
51
Number of New
Facilities Added
per Year
22,123
12,041
2,922
196
96
7
3
2
CO2 Emissions
Covered
(Tg per year)
119.262
105.306
69.885
29.384
17.765
8.790
6.003
1.012
3.11 Residential Buildings
Data Sources
EPA used residential fuel consumption data from EIA's Residential Energy Consumption
Survey, and multi-family building and unit data from U.S. Census (Census) surveys to estimate
CC>2 emissions and PTE for fuel combustion at single and multi-family residential properties.
The RECS is a national area-probability sample survey that collects energy-related data for
occupied primary housing units. The most recent 2005 survey collected data from 4,382
households in housing units statistically selected to represent the 111.1 million housing units in
the United States. RECS data are tabulated for the four Census regions, the nine Census
divisions, and for the four most populous States — California, Florida, New York, and Texas.
The RECS sample was designed so that survey responses could be used to estimate
characteristics of the national stock of occupied housing units. In order to arrive at national
estimates from the RECS sample, EPA calculated base sampling weights for each housing unit
as the reciprocal of the probability of that building being selected into the sample. Therefore, a
housing unit with a base weight of 10,000 represents itself and 9,999 similar, but not sampled
housing units in the total stock of occupied residential housing units. The base weight is further
adjusted to account for non-response bias. Ratio adjustments were also used to ensure that the
RECS weights add up to Census Current Population Survey estimates of the number of
households.
The RECS data are provided at the housing unit level, and not at the building level. EPA
used additional data from the Census on multi-family building population characteristics to
estimate total property emissions and PTE for multi-unit properties. Census data were from two
69
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sources: the Property Owner and Manager Survey (POMS, 1996) and the American Housing
Survey (AHS, 2005).
3.11.1 Single-Family Homes
The RECS data was used directly to estimate CO2 emissions from fossil fuel combustion
at single-family housing units for space heating, water heating, and appliances. EPA assumed
that each unit in an attached single-family building was a separate source, with combustion
equipment under different ownership.
The annual energy consumption by fuel (1,000 Btus) for the surveyed unit was multiplied
by the fuel CO2 emission factor to estimate annual emissions. Total single-family unit emissions
for the entire country were calculated by multiplying CO2 emissions for each units by the base
sampling weight.
Potential to Emit
The PTE for a single-family unit was calculated by dividing the CO2 emissions from the
unit by a capacity factor of 0.1. This factor was estimated by comparing the average annual CO2
emissions per heated floor space area per hour by climate zone, to required heat input capacity.
The required heat input capacity was based on rule of thumb heating system requirements for the
different climate zones. The table below shows the average Btu/ft2-hour from the RECS data
and Heating Requirement (Btu/ft2) by climate zone. A heating system efficiency of 80 percent
was used to estimate the required space heating capacity.
Table 65
Single-Family Detached and Attached
Households with Fossil Fuel-Fired Space Heating
(from RECS, 2005)
Households
(millions)
6.8
16.7
17.0
18.9
Climate
Zone(s)
5
4
3
land 2
Heating Degree
Day Range
> 7,000
5,500 - 7,000
4,000 - 5,499
< 4,000
Average Annual Fuel
Consumption
(Btu/ft2-hour)
4.8
5.4
4.6
3.8
Space Heating
Requirement*
(Btu/ft2)
50-60
45-50
40-45
Zone 2: 35-40
Zone 1: 30-35
* Heating requirement ranges are from www.acdirect.com/svstemsize.php.
70
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3.11.2 Multi-Family Residential Buildings
Emission Rates
As noted earlier in the Data Source section, the RECS data are on an individual unit
basis, not building or property basis, so a different approach was required for multi-family units
where EPA assumed common ownership of the property fuel combustion equipment. In order to
estimate property emissions and the number of properties above different emission and PTE
thresholds, EPA combined the RECS data with data from the POMS and AHS.
From the RECS data, EPA first calculated average residential unit CC>2 emissions for the
two most common fuels (natural gas and oil) by multi-family category. These are shown in the
table below.
Table 66
Multi-Family Residential Unit ~ Average Annual COi Emissions
(from RECS, 2005)
Multi-Family Category
(number of units)
2 to 4 units
5 or more units
Natural Gas Space Heating
(tons CO2/residential unit-year)
4.8
3.0
Fuel Oil Space Heating
(tons CO2/residential unit-year)
8.3
8.9
EPA also obtained annual CC>2 emission rates from an EPA analysis that was based on
Lawrence Berkeley National Lab (LBNL) modeling studies. Those rates were estimated for old
and new building units (see Table 67). The pre-1980 building estimate compares with the
overall average from the RECS data. The post-1980 building estimates are much lower,
particularly for units burning fuel oil.
Table 67
Multi-Family Residential Unit ~ Average Annual COi Emissions
(from 2008 EPA Analysis based on LBNL, 1997)
Multi-Family Category
(building age)
Pre- 1980 building
Post-1980 building
Gas Serviced Units
(tons CO2/residential unit-year)
4.75
2.65
Fuel Oil Serviced Units
(tons CO2/residential unit-year)
7.17
3.87
71
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Existing Property Characteristics
Information on the distribution of multi-family properties by number of units per property
was taken from the 1995 - 1996 POMS. The data are aggregated by different housing unit
ranges. The table below shows the property size distribution from unpublished POMS data
(NMHC Quick Facts — Apartment Stocks (http://www.nmhc.org)). The POMS data were for
privately owned housing only and excluded public housing projects (about 13,500 buildings and
1,326,000 units). For our estimates, the building numbers were adjusted to current (2005) levels
based on the RECS unit data (unit ratio of RECS to POMS). EPA assumed the same unit
distribution in the adjustment.
Table 68
Multi-Family Residential Property Size Distribution
(from National Multi-Housing Council tabulation of unpublished POMS data 1995 - 1996)
Number of Rental
Units on Property
2
3
4
5-9
10-14
15-19
20-29
30-39
40-49
50-99
100 - 199
200 - 299
300-399
400 - 499
500 - 749
Over 750
Total
Number of Properties
(1995 - 1996)
1,558,700
336,030
341,350
281,500
70,390
36,780
38,000
18,166
14,431
26,694
19,804
7,775
2,966
1,307
723
307
2,754,923
Number of Units
(1995 - 1996)
3,093,200
1,025,900
1,436,800
1,897,700
862,280
602,260
916,750
604,240
702,790
2,009,400
2,952,300
1,948,400
1,058,800
605,130
431,360
437,670
20,584,980
Average Number
of Units per
Property
2
3
4
7
12
16
24
33
49
75
149
251
357
463
597
1,426
72
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The adjusted POMS size distribution and average number of units in each category were
combined with information from RECS on the percentage of units that use gas or oil for space
heating. The gas and oil emission factors from the previous tables were applied to the average
number of units in each property size category by fuel to estimate property annual CO2
emissions.
For our final estimates we used the LBNL based emission factors for post-1980
buildings, over the RECS based factor. We found that these lower emission factors resulted in
total emissions more in line with the total based on all RECS units and residential sector
estimates in the U.S. Greenhouse Gas Inventory. The RECS-based factors combined with the
POMS property distribution data resulted in a larger overestimate in overall category annual
emissions. The lack of information on the building population over 50 units, and lack of
information on the correlation between unit emissions and the building/property size are large
sources of uncertainty in the estimates at thresholds above 1,000 tons.
Potential to Emit
PTE was estimated using the same ten percent capacity factor as used for the single
family residential units
New Properties
The AHS data provided information on new construction used to estimate the number of
new buildings and new units with natural gas space heating that were constructed in the 1999 -
2005 period. To simplify the analysis, EPA ignored the limited use of fuel oil for space heating
in new units.
The AHS data provided separately the number of new buildings with gas space heating
per year, and a size distribution for all new buildings per year. The AHS size distribution
stopped at 50 and larger, and was slightly different in other categories from the POMS data.
EPA adjusted the distribution based on the POMS distribution and then used the same emission
and capacity factor approach as used for existing units.
73
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Table 69
American Housing Survey New Building Data
Building Size:
Number of Units
per Building
2
3-4
5-9
10-19
20-29
30-49
50 or more
Total
Number of New
Buildings per Year
(1999 - 2005)
(thousands)
6.3
5.4
6.1
6.0
3.1
1.0
1.0
29.0
Fraction of All
New Buildings
per Year
(1999 - 2005)
0.22
0.19
0.21
0.21
0.11
0.03
0.03
1.00
New Gas Buildings
per Year
(1999 - 2005)
(thousands)
16.0
16.0
Number of New
Gas Buildings
per Year
3,468
2,995
3,389
3,310
1,734
552
552
16,000
74
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Threshold Summary
Table 70
CO2 Threshold Summaries — Residential Sectors
Threshold
(tons per year)
Number of
Existing Sources
Number of New
Facilities Added
per Year
CO2 Emissions
Covered
(Tg per year)
Multi-Family Residential
100
250
1,000
5,000
10,000
25,000
50,000
100,000
610,500
137,000
51,200
7,800
1,400
160
20
0
11,300
6,400
1,100
120
20
o
5
0
0
54.285
42.192
32.399
14.934
4.933
1.392
0.006
0
Single-Family Residential
100
250
1,000
3,925,000
45,350
0
33,000
515
0
51.408
1.670
0
Total Residential Sector
100
250
1,000
5,000
100,00
25,000
50,000
100,000
4,535,500
182,350
51,200
7,800
1,400
160
20
0
44,300
6,915
1,100
120
20
o
6
0
0
105.693
43.862
32.399
14.934
4.933
1.392
0.006
0
75
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Appendix A
Sector Permit Threshold Counts and Emissions by GHG
The listed electronic spreadsheet files contain the permit threshold counts and emissions
for each sector and subsector by GHG. These listed files are included in separate files in the
docket (EPA-HQ-OAR-2009-0517). Please refer to the following file names for additional
information on specific sectors and GHGs:
• GHG Data for Final Tailoring Rule Development - CO2e.xls
• GHG Data for Final Tailoring Rule Development - CO2.xls
• GHG Data for Final Tailoring Rule Development - CH4.xls
• GHG Data for Final Tailoring Rule Development - N2O.xls
• GHG Data for Final Tailoring Rule Development - HFC.xls
• GHG Data for Final Tailoring Rule Development - PFC.xls
• GHG Data for Final Tailoring Rule Development - SF6.xls
81
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Appendix B
Commercial Building Sector — Permit Threshold Results by Commercial Category
Please refer to the electronic file "Commercial Building Category CC>2 Permit Threshold
Results.xls." in the docket for EPA-HQ-OAR-2009-0517
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Attachment C
Summary of Methodology and Data Used to Estimate Burden Relief and
Evaluate Resource Requirements at Alternative Greenhouse Gas (GHG)
Permitting Thresholds
March 2010
1. Introduction
This paper summarizes an assessment of the estimated resource requirements for
permitting authorities to include GHG at several possible major source permitting thresholds and
the burden reduction and costs savings for permitting authorities and sources as a result of
requiring the inclusion of GHG in the title V and Prevention of Significant Deterioration (PSD)
permitting programs at thresholds greater than the current statutory requirements. A preliminary
analysis to support the tailoring rule proposal resulted in an earlier version of this Technical
Support Document, found at EPA-HA-OAR-2009-0517.14 Based on comments received on the
proposal and updates to key assumptions, this revised summary presents the updated
methodology and burden reduction estimates resulting from several permitting threshold
alternatives considered for the final tailoring rule. The analysis was performed considering GHG
emissions on a carbon dioxide equivalent (CC^e) basis, which represents the sum of the six
primary GHG with their respective global warming potentials (GWP) applied. Time and costs
associated with permit activities are derived from existing Information Collection Requests
(ICRs) for the title V and PSD programs. Estimates for the number of affected sources used in
14 "Summary of ICR-based Data Used to Estimate Avoided Burden and Evaluate Resource
Requirements at Alternative GHG Permitting Thresholds;" Prepared by EPA Staff; August 2009.
-------
this analysis were obtained from the GHG thresholds evaluation, which can be found at EPA-
HQ-OAR-2009-0517.15
2. Methodology for Estimating Permitting Burden Due to GHG Emission Sources
This section describes the basic methodology we used to estimate the different types and
quantities of permitting actions that would be affected by addressing GHGs under the PSD and
title V permitting programs. The final burden results summarized in Section 3 are based on the
methodologies described in this section. In developing our methodology, we established
different applicability options under which GHG emission sources would be regulated. These
GHG applicability thresholds range from the statutory threshold levels (100 and 250 tpy) to
different combinations of major source and significance levels based on GHG emissions, and
finally, applicability based on GHG-related additions to otherwise occurring permitting actions
for non-GHGs (also referred to here and in the preamble for this action as the 'anyway' source
approach). We considered several different major source/major modification threshold
combinations. We chose the combinations to reflect representative, incremental steps along the
possible range. Because it is time- and resource- intensive to develop estimates for a given step,
we chose intervals that best reflect representative points within the range given those time and
resource constraints. For example, as it became evident from the analysis that the 100,000 tpy
CO26 major source threshold would be a viable option under one of the phase-in steps in the
GHG tailoring rule, we needed to then evaluate different GHG significance level options in
combination with the 100,000 tpy CC>2 major source level to determine the ultimate impact on
PSD and title V permitting activity.
15 "Technical Support Document for Greenhouse Gas Emissions Thresholds Evaluation;" Office of Air Quality
Policy and Standards; March 29, 2010.
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PSD Permits
Table 2-1 summarizes EPA's estimate of modifications and new construction PSD
permitting actions potentially affected by the addition of GHG as a regulated air pollutant at
different GHG threshold options for PSD applicability. These actions are broken down by type
of modification and new construction activity. Three types of modifications are included in this
analysis: major modifications at major sources that are triggered by increased conventional
pollutant emissions, but also exceed the significance level for GHG; modifications previously
considered minor that become major modifications due to GHG emissions occurring at existing
major sources; and modifications at newly major GHG sources due solely to emissions
exceeding the significance level threshold for GHG. For new construction, two types of sources
are listed - those that are major sources due solely to the emissions of GHG, and those which are
classified as major due to conventional pollutant emissions, but also exceed the GHG
significance level (or 'anyway' sources).
The first line items in Table 2-1 for modifications and new construction present estimates
of GHG-related permitting actions that would occur at 'anyway' sources ; these are labeled in the
table as "Current Modifications - Add Additional GHG" and "Newly Constructed Major Sources
- Add Additional GHG." The August 2008 ICR for the New Source Review (NSR) program
estimates that 282 PSD and 519 non-attainment NSR permits are issued annually.16 EPA's initial
16 Prevention of Significant Deterioration and Non-Attainment Area New Source Review (Renewal), EPA ICR
Number 123.23, OMB Control Number 2060-0003, 2008. A copy of this document is available in the docket for
the final Tailoring Rule.
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burden analysis concentrated solely on the 282 annual PSD actions. If a source is major for a
pollutant for which an area is designated non-attainment, all significant emissions or significant
emissions increases of pollutants for which the area is in attainment are still subject to
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Table 2-1. Estimated Number of PSD Permit Actions Exceeding GHG17 Threshold Options
Threshold
Current Modifications - Add Additional GHG
Minor Modifications Becoming Newly Major
Modifications at Newly Major Sources
Modifications Total
Newly Constructed Major Sources - Add Additional GHG
Newly Constructed Major Sources
Newly Constructed Sources Total
Total
100/250
tpy
major;
100/250
tpysig.
level
448
17,894
43,942
62,284
240
19,649
19,889
82,173
25,000
tpy
major;
25,000
tpysig.
level
448
8,947
250
9,645
240
10
250
9,895
50,000
tpy
major;
50,000
tpysig.
level
448
1,789
117
2,354
240
3
243
2,597
100,000 tpy
major;
50,000 tpy
sig. level
448
1,789
20
2,257
240
2
242
2,499
100,000 tpy
major;
75,000 tpy
sig. level
448
895
20
1,363
240
2
242
1,605
100,000 tpy
major;
100,000 tpy
sig. level
448
0
20
468
240
2
242
710
Non-
GHG
448
0
0
448
240
0
240
688
17 GHG threshold options are all based on tpy CO2e. The Non-GHG option is based on a PSD action being triggered for a non-GHG, conventional pollutant
(e.g., nitric oxides), where a GHG-related PSD review is only necessary when associated GHG emissions for the project exceed 75,000 tpy CO2e.
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PSD review. Thus, some of the facilities applying for nonattainment permits may also undergo
PSD actions at the same time. Although there is no way of accurately predicting which of the
519 nonattainment actions might also coincide with a PSD action related to GHG emissions, we
believe it is likely that most will since they typically involve large emission sources; thus, it is
assumed all nonattainment actions from the ICR annual estimate will also need a PSD permit.
Therefore, in this final analysis, to more accurately depict the number of PSD permitting actions
occurring annually, it is assumed that all 801 permitting actions above involve a PSD action. We
estimate that 70% of these permit actions are modifications, or 560 of the 801, based on feedback
received from the National Association of Clean Air Agencies (which estimated that some 65%
of these permitting actions involve modifications); other commenters on the proposed tailoring
rule (who generally said that most permitting actions involve modifications); and EPA program
staff experience.18 Further, 80% of these modifications are expected to involve combustion
activities with GHG emission levels exceeding the statutory thresholds and any of the
significance levels we considered, up to an including the 100,000 tpy CC^e level, thus requiring
the inclusion of GHG related requirements in a PSD permit.19 This equates to 448 modifications
annually. We believe that any of the modifications that would be subject to PSD due to the
conventional emissions would also be large enough to increase GHGs by at least 100,000 tpy of
CO2e.
18 "NACAA Summary on Permitting GHGs Under the Clean Air Act"; Memorandum from Mary Stewart Douglas,
National Association of Clean Air Agencies to Juan Santiago, EPA/OAQPS, September 3, 2009.
19 The 80% estimate was obtained by reviewing a sample of PSD modification permits to determine the number
involving combustion that would emit GHGs. This review showed that approximately 80% of PSD permitting
actions involve combustion units of all types. These permitting actions are being permitted for, or taking limits
for, NOx or some other combustion-related emission. These run the gamut of industrial activity, from power
generators to manufacturing facilities, and many other types.
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The 240 remaining annual permit actions—labeled in Table 2-1 as "Newly Constructed
Major Source- Add Additional GHG"—are assumed to be construction of new major sources as
determined by emissions of one or more NAAQS pollutants. Due to the size and emissions of
sources currently subject to the PSD permitting program, it is believed all of these newly
constructed major sources will exceed each of the GHG thresholds we considered, including the
100,000 tpy CO26, and will also need to include GHG-related requirements in the PSD permit. In
total, all 688 major permitting actions mentioned above will need to factor in GHG requirements
as indicated in Table 2-1. For permitting authorities, 50 additional burden hours are estimated to
include the GHG requirements in a permit.20 For affected sources, approximately 222 additional
burden hours are needed, based on the two line items in the current NSRICR we expect to be
impacted by the addition of GHG - approximately 120 hours to "obtain guidance on data needs"
and 102 hours for the "preparation of BACT analysis." That is, the current NSR ICR indicates
that on average, affected sources spend 222 hours for these two activities for their conventional
pollutants. We expect that they will need to spend an equal amount of time for these two
activities for their GHG emissions. The sources will need to "obtain guidance on data needs"
because they will be analyzing their emissions from GHG units and will need to prepare a
separate BACT analysis for their GHG emissions, or else expand the BACT analysis they would
otherwise do for their conventional pollutants to account for their GHG emissions. We believe
20 A well-known gas with a familiar BACT process, such as NOx, requires an average of 20-30 burden hours to be
included in a permit. As less is known regarding GHGs and the BACT decision process, expert staff judgment
set the burden for permitting authorities to add GHG to permits at 50 hours. This is because determining BACT
entails review and analysis of the available control techniques. For a well-known pollutant, the experience of the
permitting authority allows it to efficiently consider the various options and narrow them down promptly to the
one that should be considered BACT. Because no BACT determinations have ever been made, permitting
authorities will need to invest additional time into reviewing the available technologies and selecting which one
should be considered the best for the particular source. In the absence of any previous experience selecting
BACT for GHG sources, we estimate that twice as much time will be necessary as for conventional pollutants.
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that the remaining activities that the affected sources must undertake would not be appreciably
lengthened by their need to include GHG emissions.
According to the NSRICR, approximately 74,591 minor permitting actions occur
annually, including the following: 30% involve new minor sources, new synthetic minor sources,
and synthetic-based modifications; 30% involve true minor modifications; 20% involve netting-
based minor modifications; and 20% involve minor/administrative permit revisions.21 We believe
that a number of projects that could have taken limits or netted out of PSD review and thereby
obtain a minor permit will now be required to apply for a major PSD permit, depending on the
significance threshold set for GHG. These projects are identified in Table 2-1 under "Minor
Modifications Becoming Newly Major." Combining the number of synthetic-based
modifications (7,459) and netting-based modifications (14,909) identified in the ICR,
approximately 22,368 of these actions could potentially become major modifications subject to
PSD review if their associated GHG emissions increases exceed the selected GHG significance
level option. We did not count 'new minor sources' and 'new synthetic minors' because we have
already accounted for them as potential major GHG sources if their PTE emissions exceed the
selected GHG major source threshold option.
Based on staff review of samples of minor source permits, it is estimated that 80% of the
current minor modification actions likely involve combustion sources - totaling 17,894 actions
of the total 22,368 minor modification actions.22 Some of these actions may trigger the
requirements of the PSD program depending on their GHG emission increases and the selected
GHG significance threshold. In the absence of any experience involving GHG sources and any
sufficient quantitative data from commenters, we determined the number of these actions on the
21 See NSR ICR at page 11.
22 See footnote 6, above (basis for 80% calculation).
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following basis: We assumed the following percentage of the total 17,984 actions would move
to a major modification status due to GHG increases for each of the GHG significance level
options considered in this analysis: 50% at 25,000 tpy CO2e; 10% at 50,000 tpy CO2e; 5% at
75,000 tpy CO2e; and zero at 100,000 tpy CC^e. To determine these percentages, we considered
the relative emissions of CO2 emissions to NOx emissions at the current major modification
significance level threshold for NOx (40 tpy). For example, for an average natural gas
combustion boiler (a common industrial combustion unit that is part of many modification
projects), a 40 tpy NOx emissions would coincide with a 56,000 tpy CO26 level. Since many
combustion related projects keep just under the 40 tpy NOx level to avoid major modification
status, we assume that the CO26 emissions for a similar project will be around the 50,000 tpy
CO26 level. Based on the relationship in combustion-related emission levels between NOx and
CO26 just described, we believe it is reasonable to expect that all these currently minor
modification projects involving combustion units will exceed the 100 tpy GHG significance level
under the baseline scenario. This is because we do not believe that the sources at which these
projects occur will be able to structure their operations so as to limit their GHG emissions to less
than 100 tpy GHGs. However, at higher GHG significance level options, we assume that a
decreasing proportion of projects will be significantly large enough, or they may emit GHGs
close enough to the GHG significance level to be able to limit their operations or net-out for
GHGs like they can for NOx. In the absence of experience and quantitative information from
commenters we made the following assumptions regarding how many of these formerly minor
modification projects would be subject to major PSD review at the different GHG significance
level options: at the 25,000 tpy CO26 significance level, we estimate that half of the
modifications will be able to limit their operations to avoid PSD ; at the 50,000 tpy CO26
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significance level, we estimate that 10% of these previously minor now major modifications will
be covered by PSD; at the 75,000 tpy CC^e significance level we estimate that only 5% of these
currently minor modification projects move into a major modification status for GHGs; and
lastly, at the 100,000 tpy CC^e significance level, we assume that none of these projects will be
large enough by themselves to trigger major PSD review.
In addition to sources becoming subject to PSD requirements because of GHG emissions
related to modifications, new construction will occur that will require a PSD permit solely due to
the source's potential GHG emission levels, identified in Table 2-1 as "Newly Constructed
Major Sources." Based on the source data obtained from the GHG thresholds evaluation, these
newly constructed major sources involve both industrial and commercial/residential facilities.23
The current NSRICR notes that permitting authorities spend approximately 300 hours
processing and issuing a new construction industrial source PSD permit. Sources spend almost
870 hours on average preparing for the same permit. In the previous burden analysis,
commercial/residential permits were assumed to require only 20% of the time necessary for an
industrial permit. While it is still believed that these sources are less complex than their industrial
counterparts in terms of numbers and types of emissions sources and control requirements, EPA
now estimates the commercial/residential permits to take 70% of the time required to complete
an industrial permit, resulting in approximately 210 hours and 866 hours for permitting
authorities and sources respectively.24 This is based on comments received, which stated that we
had significantly underestimated the amount of time needed. These commenters emphasized that
commercial and residential sources will generally be located in populated areas, and therefore
23 "Technical Support Document for Greenhouse Gas Emissions Thresholds Evaluation;" Office of Air Quality
Policy and Standards; March 29, 2010.
24 See Tables 2-2 and 2-3.
10
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may elicit significant amounts of public input, which in turn will increase the amount of time
needed compared to our initial estimates. However, the commenters generally did not provide
quantitative information. As a result, we conducted further evaluation of the additional support
and outreach activities for permitting authorities to assist with applicability determinations and
emissions calculations, as virtually all commercial/residential sources will have no experience
with the PSD permitting process. There are also many permit preparation activities that represent
a fixed cost, such as preparation of notices and public hearings. Of the sources falling in this
category, the number requiring PSD permitting will vary depending on where the thresholds for
triggering PSD review (both major source and modifications thresholds) are established.
Table 2-2. Average Permitting Authority Burden per GHG PSD Permit Type
Activity
Attend Preapplication Meetings
Answer Respondent Questions
Log In and Review Data Submissions
Request Additional Information
Analyze for and Provide Confidentiality Protection
Prepare Completed Applications for Processing
File and Transmit Copies
Prepare Preliminary Determination
Prepare Notices for and Attend Public Hearings
Application Approval
Notification of Applicant of PA Determination
Submittal of Information on BACT/LAER to RBLC
Total Burden Hours per Permit
Burden
Hours per
Permit -
Industrial
36
20
16
8
24
38
8
36
40
48
8
19
301
Burden Hours
per Permit -
Commercial/
Residential"
27
15
12
6
2
29
6
27
30
36
6
14
210
" In general, to process commercial/residential permits, permitting authorities will have to spend 75% of the amount of time
they spend on industrial permits, except they will have to spend even less time on confidentiality due to the fact that most
residential sources are not likely to be concerned about confidentiality. Commercial/residential permits will be much
simpler than industrial permits, but a large part of the permitting costs are fixed costs. For example, organizing and holding
a hearing for a much simpler permit, compared to a more complex permit, nevertheless take almost as long because of the
document preparation, travel, and organizational details.
11
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Table 2-3. Average Source Burden per GHG PSD Permit Type
Activity
Burden Hours
per Permit -
Industrial
Burden Hours per
Permit - Commercial/
Residential"
Preparation and Planning
Determination of Compliance Requirements
Obtain Guidance on Data Needs
Preparation of B ACT Analysis
170
120
102
170
120
102
Data Collection and Analysis
Air Quality Modeling
Determination of Impact on Air Quality
Related Values
Post-construction Air Quality Monitoring
200
100
50
40
30
20
Permit Application
Preparation and Submittal of Permit
Application
Public Hearings
Revisions to Permit
Total Burden
60
24
40
866
60
24
40
606
aPSD permit applications for commercial/residential sources will be significantly simpler than industrial source PSD
permit applications. However, due to their inexperience, we estimate commercial/residential sources will take as long to
complete their steps for their permit application as it will for industrial sources to complete their steps.
Commercial/residential sources will, on average, have much less work for data collection and analysis. We estimate that
they will have approximately 25% as much work in these areas (90 hours) compared to industrial sources (350 hours).
However, commercial/residential sources will have to spend some time on data collection analysis is because some of
them will have conventional pollutants that they emit in amounts that exceed the "significance" levels, but not the
"major" levels, and they will have to analyze those conventional pollutants. Our 25% estimate is based, in the absence of
actual experience or quantitative data from commenters, on our judgment that significantly less than 50% of
commercial/residential sources emit conventional pollutants in amounts that equal or exceed the significance levels, but
those that do may have to spend more time than industrial sources on data collection because they are unfamiliar with the
tasks and therefore will face a learning curve.
Finally, an existing, but newly classified major source for GHG, may undergo a
modification for which it will then be subject to PSD permitting requirements. This category of
PSD permitting activity is listed on Table 2-1 as "Modifications at Newly Major Sources." With
this new major source status, these facilities must apply for and be issued a PSD permit, if they
undergo a major modification. See Appendix A for a list of newly major sources at different
12
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major source GHG thresholds. We estimate that 4% of these newly major sources will undergo
modifications. This rate was obtained by dividing the current 560 annual PSD modification-
related permit actions (i.e., 70% of 801 actions identified in the NSRICR) by the existing major
source population of 14,700 major source title V permits. This represents our best available
estimate of the rate of PSD modification activity at major sources, and we make the assumption
that this rate will also apply for newly major GHG sources. We recognize that there is some
level of uncertainty in applying this rate to GHG-only sources, particularly for sources in
unconventional sectors such as commercial and residential categories, however we believe at
higher GHG threshold levels, where large industrial sources predominate, that this modification
rate provides a reasonable estimate of modification activity. As no data are yet available for
commercial/residential sources and because we cannot conclude that they will differ from
industrial sources, we select the same 4% rate for modification activity.
Title V Permits
Title V programs also complete several types of permitting actions annually,
including processing and issuing new permits, permit revisions, and permit renewals.
Newly constructed major sources or sources designated newly major due to a
modification are required to apply for and be issued a title V permit in order to operate. In
addition to sources new to title V, permitting authorities must add GHG terms to permits
for sources exceeding the threshold set for GHG emissions. Permitting authorities may
face burdens to update existing title V permits for GHG under two possible scenarios: (1)
EPA promulgates or approves any applicable requirements for GHGs that would apply to
such a source, which would generally require a permit reopening or renewal application,
or (2) the source makes a change that would result in an applicable requirement for GHG
to newly apply to the source, such as PSD review, which would generally require an
application for a permit revision. Permitting authorities will also need to process permit
13
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renewal applications, generally on a five-year cycle, and such renewals would need to
assure that the permit properly addresses GHG.
The April 2007 Title VICR estimates that 50 permits are completed every year for new
sources.25 For this analysis, it is assumed that all 50 of these typically large industrial-type
sources will be capable of potentially emitting GHG and will need to add GHG-related
requirements to the permit. The estimated burden per title V permit in the ICR represents an
average of multiple pollutants; we estimate the addition of GHGs will add an additional 10% of
the time currently estimated for a new title V permit. We believe that 10% is the appropriate
amount because for the most part, these sources will simply need to add information concerning
inventory, reporting, or monitoring of their GHG emissions, as appropriate, which they can
readily do.
The ICR also identifies 3,267 permit renewals conducted on an annual basis. As not all
sources potentially emit GHG above a determined threshold, this analysis examines the
estimated 80% involving combustion activities that most likely have the potential to emit GHG
above the series of potential thresholds evaluated.26 Therefore, approximately 2,614 sources will
need to address GHG in the new version of the permit.
Revisions to title V permits will also be necessary based on the number of modifications
calculated for this analysis. Revisions occurring specifically due to GHG may involve significant
revisions, minor revisions, or administrative actions to operating permits. EPA estimates that this
activity will require 40 hours per permit on average for permitting authorities to complete.27 The
25 Information Collection Request for State Operating Permit Regulations (Renewal), EPA ICR Number 1587.07,
OMB Control Number 2060-0243, 2007. A copy of this document is available in the docket for the final
Tailoring Rule.
26 The 80% estimate was obtained through a review of existing title V permit source categorization.
27 The Title V ICR indicates the burdens associated with revisions are as follows: 90 hours for a significant revision,
30 hours for a minor revision, and 5 hours for an administrative action. See Table 8 at 23. It is not known which
14
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number of operating permit revisions will vary based on the number of previously minor
modifications now qualifying as major modifications, and modifications at newly major sources,
both listed in Table 2-1. At any level, it is assumed that the 448 modifications involving
combustion that occur annually will need to include any GHG requirements in the revision of
their respective title V permits. EPA estimates that permitting authorities will spend, in addition
to the current burden to issue a title V permit revision, an additional 10% of the 40 hours needed
to complete this process, or four hours per action.
Finally, new industrial and commercial/residential sources will be entering title V
permitting programs annually due solely to their GHG emissions. These commercial/residential
sources that exceed the major source threshold solely due to their GHG emissions will not likely
have substantial applicable requirements in the near term and/or will not require as much time to
process as those for industrial sources, which have other applicable requirements in addition to
those related to their GHG emissions. However, upon further evaluation and in response to
comments from permitting authorities, EPA believes its initial estimate of one-tenth of the
burden hours required was considered too low. Permitting authorities would confront substantial
challenges as they have little experience with such sources and their GHG emissions.
Commercial/residential sources themselves will have no experience with the title V permitting
process, which will increase the time needed to assess GHG emissions, complete the application,
and respond to permitting authority comments. We also expect that in many cases the draft
permits will undergo high levels of public participation through public comment periods, public
hearings, and petitions for reconsideration. Therefore, EPA assumes preparing a permit for
revision will be required for any modification that exceeds the GHG significance level threshold; therefore, EPA
averages the three permitting burdens to obtain a value of 40 hours per permit.
15
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affected commercial/residential sources will take 50% of the time a permitting authority
currently spends on issuing a title V permit for an industrial source.
Table 2-4. Average Permitting Authority Burden per GHG Title V Permit
Activity
Permit Application Review
Draft Permits Preparation
Comment Period Notification
Hold Public Hearings
Interaction with EPA
Analyze Public Comments
Permits Issuance
Total Burden
Burden
Hours per
Permit -
Industrial
100
150
10
100
20
40
8
428
Burden Hours
per Permit -
Commercial/
Residential"
33
50
10
90
5
20
6
214
"Commercial/residential permits will be simpler, so that it would take the permitting authority about 1/3 of the
time to review the permit application and draft the permit than it would for an industrial source permit. The
comment period notification and time for public hearings, however, would be about the same because of the
fixed time burdens necessary to provide notice and hold hearings. The amount of time interacting with EPA
would be much less because of the relative simplicity of the permits. Analyzing public comments would take
half as long as for an industrial permit because although the permits are much simpler, there could be a fair
amount of public interest because of the location of the source. Permit issuance would take a less time than for
an industrial source because most of the costs are fixed, although the permit is simpler.
Table 2-5. Average Source Burden per GHG Title V Permit
Activity
Prepare Application
Draft Permits Interaction
Public Hearing Participation
Total Burden
Burden
Hours per
Permit -
Industrial
300
40
10
350
Burden Hours
per Permit -
Commercial/
Residential"
150
20
10
180
"Commercial/residential permit applications will be significantly simpler than industrial source title V permit
applications. However, due to their inexperience, we estimate commercial/residential sources will take half as
long to complete their steps for their permit application as it will for industrial sources to complete their steps.
Less interaction, again 50% less time, will be needed with permitting authorities during the permit drafting
process. However, public hearing participation will likely require the same amount of time because of the fixed
time burdens necessary to complete hearings.
16
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Uncertainties in Estimates of Affected Sources
In order to estimate the number of facilities that exceed a given GHG threshold (such as a
100 or 250 tpy CC^e emission threshold for baseline analysis), it is necessary to have emissions
inventory data at the facility or building level, including, and particularly for lower threshold
scenarios, numerous small sources in the residential and commercial sectors (e.g., apartment
buildings and office buildings). Historically, however, EPA has not collected sector-wide,
facility-level information for GHG emissions under the CAA (with the exception of information
from electric generating units required to report CC>2 emissions under the Acid Rain Program
reporting requirements). To date, national EPA inventories of GHG sources have primarily
focused on 'top-down' estimates of GHG emissions from sectors and sources, and not facility-
level estimates. As a result, many of the uncertainties described here result from the absence of a
comprehensive data set of facility-level GHG emissions across all sectors. A full description of
the methodology used for determining facility level emissions is provided in our GHG thresholds
evaluation study, which can be found at EPA-HQ-OAR-2009-0517.28
For residential, commercial, and smaller manufacturing operations, our current analysis
relies on sample facility datasets and 'top-down' sector data (e.g., national fuel consumption
statistics and/or building characteristics). There are inherent uncertainties in developing source
counts from the allocation of these nationally aggregated statistics. The allocation factors we
used, based on U.S. Energy Information Administration statistical sampling procedures and
energy consumption statistics, are likely the best available to estimate the population of
residential, commercial, and small manufacturing sources exceeding different GHG thresholds.
"Technical Support Document for Greenhouse Gas Emissions Thresholds Evaluation;" Office of Air Quality
Policy and Standards; March 29, 2010.
17
-------
However, uncertainties may result in either overestimating or underestimating GHG emissions
for a given individual facility. It is worth noting that our estimates for the largest GHG emitting
sources, such as electric utilities and refineries, are derived from bottom-up calculations of
individual facility/building emissions so that there is increased certainty in evaluating and
comparing the facility counts at the higher GHG threshold scenarios where residential and
commercial sources are not highly affected. Although there are different levels of uncertainty in
our facility level estimates across sectors, we do believe that the data are sufficiently robust to
use in the aggregate to assess national permitting level impacts.
EPA's estimate of affected sources is based on their potential to emit (PTE) emissions, as
opposed to actual emission levels. PTE is defined as the maximum capacity of a stationary
source to emit a pollutant under its physical and operational design, including certain legal
limitations, for example, on emissions or hours of operation. NSR and Title V programs both
use PTE for defining and identifying major sources. Although we have attempted to identify
reasonable adjustments to account for PTE in our methodology, there are significant
uncertainties in our PTE-based estimates, particularly for the commercial, residential and small
manufacturing sectors that have not traditionally been subject to any form of air permitting. In
practice, for example, for the residential sector and for many of the facilities in the commercial
sector, where CC>2 emissions are primarily due to space heating/appliance usage, the combustion
units are not likely to be used constantly at their maximum rated capacity because heating is not
needed year-round and heating systems have thermostats. However, for our analysis we do
assume full PTE-based estimates for the residential and commercial sectors, using PTE
adjustment factors of 10 and 6.6, respectively to adjust actual emissions to PTE level. Absent
industry specific data, for small manufacturing source categories we assume a PTE adjustment
18
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factor of 2; individual manufacturing facilities may operate their combustion equipment at levels
above and below this capacity utilization rate, but we believe this PTE adjustment reflects a
reasonable average rate across the variety of small manufacturing facilities included in the
threshold analysis. Ultimately, the number of sources brought into either the NSR or Title V
programs due solely to their PTE would depend on how EPA interprets PTE for various types of
emitting equipment (e.g., space-heating furnaces in residential and commercial buildings), and
the extent to which streamlined mechanisms are made available for sources to obtain legal limits
on their PTE so that the programs are not applicable. No such decisions or interpretations have
been made at this point and, as mentioned in the preamble, they will require significant time to
develop. As a result, our threshold analysis uniformly assumes that no PTE limits are in place
for any of the affected sectors, which may likely be the case in the immediate stages of GHG
permitting for affected sources.
There is significant uncertainty in both our modification rate for newly major GHG
sources and in our estimate of modification activity at existing major sources that will become
subject to PSD review for GHG emission increases. The general uncertainty results from
predicting not only how many major sources will undergo physical or operational changes in any
given year, but also which of those changes would result in GHG emissions increases that would
exceed a proposed GHG significance level. First, information is not available across sectors and
source categories on the types and numbers of specific physical and operational changes that
would result in GHG emissions increases in amounts that can be estimated and that therefore can
be compared to various GHG emissions significance levels. Second, there is uncertainty in how
many project modifications will occur within any given year because decisions on these projects
are driven by facility- and sector-based growth patterns and business planning decisions. Lastly,
19
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some source categories and units that emit GHGs have not previously been subject to any type of
permitting or reporting requirements; as a result, for these sources, there is very little historical
record for use in estimating the number and types of projects that would occur at these sources
and, in turn, establish an appropriate significance level for GHGs.
Uncertainties in Permitting Costs
The primary reference sources for our estimate of burden hours and costs for permitting
GHGs are the most recent ICRs for the PSD and title V programs. There a number of
uncertainties introduced in using these references for costing GHG permitting activities. First,
we are assuming that the average, conventional pollutant per-permit costs will be similar for
GHGs. We do recognize the likelihood that residential and commercial permits would be
simpler and have a lower per-permit burden than traditional industrial sources, and have made
adjustments for this: however, for industrial sources we assume per-permit costs on par with
what are estimated in the latest ICRs for PSD and title V programs. There is uncertainty in
applying these average ICR-based costs to GHG permitting, even for industrial sources, because
there is no historical track record for permitting these GHG sources and thus any cost
efficiencies that have been realized over the years for conventional pollutant permitting, and thus
reflected in the current ICRs, may not be initially realized for GHG permitting. For example, we
assume the same public hearing estimate as included in the ICR for current PSD permits (i.e.,
that 1 in 50 major PSD permits require a hearing)—for GHG sources this number may be higher
initially if there ends up being significantly more public interest in these permits. We do believe
overall, however, that larger facilities, especially those affected at higher threshold levels, will
20
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have had sufficient permitting experience such that out ICR-based costs should reasonably
reflect the added burden of including GHGs.
As mentioned above, in our burden scenario analyses we do discount the ICR-based per-
permit costs for residential and commercial sources to reflect what we believe will generally be
simpler permits, involving primarily uniform combustion type equipment. For PSD we discount
the per-permit cost by 30%, and for title V we discount the per-permit cost by 50%. There is
significant uncertainty in these estimated discounts since we have no track record for permitting
these smaller commercial and residential sources. However, we do believe that, based solely on
the type and uniformity of the GHG emission units that would be subject to permitting at these
facilities under lower GHG threshold scenarios, that average per-permit costs would be less than
those currently experienced by more complex industrial facilities, with numerous emission units,
for currently regulated pollutants.
3. Evaluation of ICR-based Resource Requirements for Permitting Authorities at Different
Possible GHG Permitting Thresholds
For the proposal, EPA examined resource requirements at the statutory-based 100/250
tpy CO26 emission levels—referred to as the 'baseline' analysis in the following tables—as well
as at 10,000 tpy, 25,000 tpy, and 50,000 tpy CC^e levels. Due to comments received on the
proposal and this improved burden analysis, the 10,000 tpy threshold was eliminated as not being
a viable alternative since it did not adequately address administrative necessity concerns. In this
analysis, in addition to the baseline analysis, EPA broadened the options to consider thresholds
ranging from a 25,000 tpy CC^e major source applicability level for PSD and title V up to a
100,000 tpy CO26 level, with associated PSD GHG significant levels of equal magnitude. EPA
21
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also considered the impact on burden of different PSD GHG significance levels combined with
the 100,000 tpy major source level, including 50,000 CO2e, 75,000 CO2e, and 100,000 CO2e.
The choice of a PSD significance level also has a direct impact on title V burdens since a greater
number of PSD permit requirements that result from modification activities will result in a
greater number of necessary title V revisions.
PSD Permits
Table 3-1 presents the estimated burden for permitting authorities at different possible
PSD GHG major source applicability thresholds. Descriptions of the different thresholds
selected are provided below. Burden estimates for the PSD program are calculated based on
listed values obtained from Tables 6-1 and 6-2 the NSRICR. The ICR does not distinguish
between new construction and modification actions; therefore, Table 3-1 combines the actions
into permit preparation issuance based solely on GHG emissions or the addition of GHG
requirements to permits being issued for conventional sources, or "anyway" permits. PSD permit
preparation and issuance is further divided into industrial and commercial/residential sources
since less time is required for commercial/residential sources.
Baseline
After receiving comments on the proposal and reevaluating the initial estimates, EPA has
determined the impact of regulating GHG emissions under current PSD statutory thresholds for
applicability. Baseline burden and cost were calculated at the 100 tpy and 250 tpy major source
permitting threshold (the 100 tpy threshold applies to the 28 source categories identified in the
22
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Clean Air Act section 169(1)). At these thresholds, the additional annual permitting burden for
permitting authorities is estimated at 19.5 million hours at a cost of $1.5 billion.
Table 3-1. Additional Permitting Authority PSD Burden with GHG (Annual)
Activity
Burden
Hours
per
Permit
Affected
Permits
Total
Burden
(hours)
Total Cost
($2007)a
100/250 tpy Major /100 tpy Significance Threshold ("Baseline")
PSD Permit Preparation and Issuance - Industrial
PSD Permit Preparation and Issuance - Commercial/Residential13
Additions to Current PSD Applications0
Total Additional Burden
301
210
50
26,089
55,509
688
7,852,789
11,656,890
34,400
19,544,079
$606,392,367
$900,145,046
$2,656,368
$1,509,193,780
25,000 tpy Major/ 25,000 tpy Significance Threshold
PSD Permit Preparation and Issuance - Industrial
PSD Permit Preparation and Issuance - Commercial/Residential
Additions to Current PSD Applications
Total Additional Burden
301
210
50
9197
63
688
2,768,297
13,230
34,400
2,815,927
$213,767,894
$1,021,621
$2,656,368
$217,445,883
50,000 tpy Major/ 50,000 Significance Threshold
PSD Permit Preparation and Issuance - Industrial
PSD Permit Preparation and Issuance - Commercial/Residential
Additions to Current PSD Applications
Total Additional Burden
301
210
50
1906
28
688
573,706
5,880
34,400
613,986
$44,301,577
$454,054
$2,656,368
$47,411,999
100,000 tpy Major/ 50,000 tpy Significance Threshold
PSD Permit Preparation and Issuance - Industrial
PSD Permit Preparation and Issuance - Commercial/Residential
Additions to Current PSD Applications
Total Additional Burden
301
210
50
1809
4
688
544,509
840
34,400
579,749
$42,046,985
$64,865
$2,656,368
$44,768,218
100,000 tpy Major/ 75,000 tpy Significance Threshold
PSD Permit Preparation and Issuance - Industrial
PSD Permit Preparation and Issuance - Commercial/Residential
Additions to Current PSD Applications
Total Additional Burden
301
210
50
915
4
688
275,415
840
34,400
310,655
$21,267,546
$64,865
$2,656,368
$23,988,779
100,000 tpy Major/ 100,000 tpy Significance Threshold
PSD Permit Preparation and Issuance - Industrial
PSD Permit Preparation and Issuance - Commercial/Residential
Additions to Current PSD Applications
Total Additional Burden
301
210
50
20
4
688
6020
840
34,400
41,260
$464,864
$64,865
$2,656,368
$3,186,097
Non-GHG-Based Threshold
PSD Permit Preparation and Issuance - Industrial
PSD Permit Preparation and Issuance - Commercial/Residential
Additions to Current PSD Applications
301
210
50
0
0
688
0
0
34,400
$0
$0
$2,656,368
23
-------
I Total Additional Burden | | | 34,400 | $2,656,368
"Labor cost of $77.22/hr from Prevention of Significant Deterioration and Non-Attainment Area New Source Review (Renewal), EPA ICR Number 1230.23, OMB
Control Number 2060-0003, 2008.
bAssume permit preparation and issuance for commercial/residential permits takes 70% the amount of time needed to prepare and issue an industrial permit.
'For current permit applications, assume it takes an additional 50 hours to include GHG requirements in the permit.
Alternate Threshold Scenarios
After determining the baseline, additional annual burden was determined at six different
major stationary source threshold levels in order to evaluate the relative differences in impacts to
permitting authorities. Estimates represent the additional burden and costs due to GHG
permitting beyond to the burden currently experienced by permitting authorities and sources.
The first scenario is the threshold proposed in the GHG Tailoring Rule of 25,000 tpy
CO2e. Results of this analysis indicate a total of 9,260 new permits, plus 688 permit actions to
include GHG related requirements into current PSD permitting actions (including both new
construction and modifications). This additional workload equates to 2.8 million hours for
permitting authorities at a cost of $217 million. Note this is an increase over our initial results at
proposal of over 185,000 burden hours and $8.7 million. Again, increases are due to more
accurate estimates of annual modifications and burden associated with commercial/residential
permits.
Increasing the emission threshold to 50,000 tpy will lead to an estimated 614,000 hours
additional burden at a cost of $47.4 million. This scenario estimates 1,934 new construction or
modification activities will be subject to PSD permitting annually due to GHG.
Setting a threshold of 100,000 tpy with a significance level of 50,000 tpy, permitting authorities
will spend an estimated 580,000 hours preparing and issuing permits, at a cost of $44.8 million.
At this level, EPA estimates 1,813 new actions require PSD permits.
24
-------
Next, at the 100,000 tpy threshold with a 75,000 tpy significance level, the annual
permitting authority burden will increase by 311,000 hours at a cost of $24 million. In this
scenario, 919 new permit actions will occur annually.
At a 100,000 tpy threshold, with a 100,000 tpy significance level for modifications, EPA
estimates there are 20 new industrial PSD permit actions and four commercial/residential.
Permitting authorities will spend an estimated 41,000 additional hours on permits at a cost of
$3.2 million.
The final scenario involves only sources that are required to get a PSD permit due to their
non-GHG emissions and then are further required to add GHG related requirements as a result of
GHG emissions increases from modifications, or GHG emissions at newly constructed facilities,
exceeding a significance threshold of 75,000 tpy GHG. In this scenario, only the annual 688 PSD
permit actions derived from the NSRICR are expected to need the inclusion of GHG related
requirements to the permits. The additional burden to permitting authorities under this scenario is
estimated at 34,000 hours at a cost of $2.7 million.
Title V Permits
Table 3-2 presents the estimated burden for permitting authorities at different possible
title V GHG major source applicability thresholds. Descriptions of the different thresholds
selected are provided below. Burden estimates are calculated and annual values derived from
Tables 7 and 8 of the current Title V ICR.29
29 For consistency, the permitting authority labor costs are updated to 2007 dollars utilizing the 2007
General Schedule Salary Table from the Office of Personnel Management.
25
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Baseline
EPA reevaluated our estimates of the additional administrative burden and cost of
including GHG emitters in the title V program at the current 100 tpy statutory threshold level. To
determine the impact of regulating GHG emissions under current title V program, baseline
26
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Table 3-2. Additional Permitting Authority Title V Burden with GHG (Annual)
Activity
Burden
Hour per
Permit
Affected
Permits
Total Burden
(hours)
Total Cost ($2007)"
100 tpy (associated with PSD 100/250 tpy maj./lOO tpy sig.)
New Permit Preparation and Issuance - Industrial
Add GHG component to new Non-GHG Permitb
New Permit Preparation and Issuance - Commercial/Residential0
Permit Revisions - due to GHG
Permit Revisions - add GHG to Current Non-GHG Permits
Permit Renewals'1
Total Additional Burden
428
43
214
40
4
9
71,829
50
1,985,948
61,836
448
2,614
30,742,812
2,150
424,992,872
2,473,440
1,792
23,526
458,236,592
$1,414,169,352
$98,900
$19,549,672,112
$113,778,240
$82,432
$1,082,196
$21,078,883,232
25,000 tpy (associated with PSD 25,000 tpy maj./25,000 tpy sig.)
New Permit Preparation and Issuance - Industrial
Add GHG component to new Non-GHG Permit
New Permit Preparation and Issuance - Commercial/Residential
Permit Revisions - due to GHG
Permit Revisions - add GHG to Current Non-GHG Permits
Permit Renewals
Total Additional Burden
428
43
214
40
4
9
2,103
50
444
9,197
448
2,614
899,941
2,150
94,945
367,880
1,792
23,526
1,390,234
$41,397,301
$98,900
$4,367,455
$16,922,480
$82,432
$1,082,196
$63,950,764
50,000 tpy (associated with PSD 50,000 tpy maj./50,000 tpy sig.)
New Permit Preparation and Issuance - Industrial
Add GHG component to new Non-GHG Permit
New Permit Preparation and Issuance - Commercial/Residential
Permit Revisions - due to GHG
Permit Revisions - add GHG to Current Non-GHG Permits
Permit Renewals
Total Additional Burden
428
43
214
40
4
9
981
50
208
1,906
448
2,614
419,868
2,150
44,441
76,240
1,792
23,526
568,017
$19,313,928
$98,900
$2,044,271
$3,507,040
$82,432
$1,082,196
$26,128,767
100,000 tpy (associated with PSD 100,000 tpy maj./50,000 tpy sig.)
New Permit Preparation and Issuance - Industrial
Add GHG component to new Non-GHG Permit
New Permit Preparation and Issuance - Commercial/Residential
Permit Revisions - due to GHG
Permit Revisions - add GHG to Current Non-GHG Permits
Permit Renewals
Total Additional Burden
428
43
214
40
4
9
172
50
18
1,809
448
2,614
73,473
2,150
3,781
72,360
1,792
23,526
177,082
$3,379,773
$98,900
$173,911
$3,328,560
$82,432
$1,082,196
$8,145,772
27
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Table 3-2 cont'd. Additional Permitting Authority Title V Burden with GHG (Annual)
Activity
Burden
Hour per
Permit
Affected
Permits
Total Burden
(hours)
Total Cost ($2007)"
100,000 tpy (associated with PSD 100,000 tpy maj./75,000 tpy sig.)
New Permit Preparation and Issuance - Industrial
Add GHG component to new Non-GHG Permit
New Permit Preparation and Issuance - Commercial/Residential
Permit Revisions - due to GHG
Permit Revisions - add GHG to Current Non-GHG Permits
Permit Renewals
Total Additional Burden
428
43
214
40
4
9
172
50
18
915
448
2,614
73,473
2,150
3,781
36,600
1,792
23,526
141,322
3,379,773
$98,900
$173,911
$1,683,600
$82,432
$1,082,196
$6,500,812
100,000 tpy (associated with 100,000 tpy ma.j./ 100,000 tpy sig.)
New Permit Preparation and Issuance - Industrial
Add GHG component to new Non-GHG Permit
New Permit Preparation and Issuance - Commercial/Residential
Permit Revisions - due to GHG
Permit Revisions - add GHG to Current Non-GHG Permits
Permit Renewals
Total Additional Burden
428
43
214
40
4
9
172
50
18
20
448
2,614
73,473
2,150
3,781
800
1,792
23,526
105,522
$3,379,773
$98,900
$173,911
$36,800
$82,432
$1,082,196
$4,854,012
Non-GHG Based Threshold
New Permit Preparation and Issuance - Industrial
Add GHG component to new Non-GHG Permit
New Permit Preparation and Issuance - Commercial/Residential
Permit Revisions - due to GHG
Permit Revisions - add GHG to Current Non-GHG Permits
Permit Renewals
Total Additional Burden
428
43
21
40
4
9
0
50
0
0
448
2,614
0
2,150
0
0
1,792
23,526
27,468
0
$98,900
$0
$0
$82,432
$1,082,196
$1,263,528
"Salaries from Title V ICR adjusted to 2007 dollars using 2007 OPM General Schedule Salary Table available at: http://www.opm.gov/oca/07tables/index.asp
'incorporating GHG information/requirements into significant revisions and permit renewals adds an additional 10% of the current time (90 hours each)
'New commercial/residential permits require half the time needed for new industrial permits
dThe Title V ICR estimates that 3,267 permits annually undergo renewal - assume 80% of these involve combustion
28
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burden and cost are calculated at the 100 tpy threshold level, which is the generally applied
major source applicability level under title V. At the statutory threshold level, it is estimated that
over six million sources will become newly subject to title V. A source generally must apply for
a title V permit within one year of becoming subject to permitting, then the permitting authority
must take final action (issue or deny) on the permit applications within 18 months of receipt. We
expect these new permits will not be issued all at once, but rather will come in over a three-year
time frame based on the statutory requirements listed above. Therefore, we assume that one-
third of the newly subject sources will apply for and obtain a permit annually, requiring almost
460 million burden hours to prepare and issue over two million new operating permits at an
additional cost of $21.1 billion.
Alternate Threshold Scenarios
After determining the baseline, additional burden was determined at six different major
stationary source threshold levels in order to evaluate the relative differences in impacts to
permitting authorities. Estimates represent the additional annual burden and costs due to GHG
permitting beyond the burden and costs currently experienced by permitting authorities and
sources.
The first scenario is the threshold proposed in the GHG Tailoring Rule of 25,000 tpy
CO26. Results of this analysis indicate a total of 2,547 new permits, as well as 50 permits that
would need to include GHG requirements in their permits. This additional workload equates to
1.4 million hours for permitting authorities at a cost of $64 million. Note that this is an increase
over our initial results at proposal of approximately 985,000 burden hours and $45 million. As
29
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with PSD programs, increases are due to more complete estimates of annual modifications and
the revised burden associated with commercial/residential permits.
Increasing the emission threshold to 50,000 tpy will lead to an estimated 568,000 hours
additional burden at a cost of $26.1 million. This scenario estimates 1,189 new sources will be
subject to title V permitting annually due to GHG.
To examine the impact of significance levels on the overall burden, EPA considered the
impact on burden of different PSD GHG significance levels of 50,000 CO2e, 75,000 CO2e, and
100,000 CO26 combined with the 100,000 tpy major source level The choice of a PSD
significance level has a direct impact on title V burdens since a greater number of PSD permit
requirements that result from modification activities will result in a greater number of necessary
title V revisions. This effect is apparent in Table 3-2. Note that for all three scenarios, EPA
estimates there are 172 industrial and 18 commercial/residential new title V permit actions due to
GHG.
Setting a threshold of 100,000 tpy with a PSD significance level of 50,000 tpy, permitting
authorities will spend an estimated 177,000 hours preparing and issuing permits, at a cost of $8.1
million. Note that under this scenario, 1,809 revisions are estimated annually to update existing
operating permits due to modification activities. Utilizing a 75,000 tpy PSD significance level,
the annual permitting authority burden is estimated to increase by 161,000 hours at a cost of $7.4
million. At this significance level, 915 operating permit revisions will be necessary due to GHG.
This decrease from the previous scenario is due to fewer modifications exceeding the higher
significance level threshold and requiring revisions to an operating permit. At a 100,000 tpy
threshold, with a 100,000 tpy PSD significance level for modifications, EPA estimates there are
30
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only 20 permit revisions annually. Permitting authorities will spend an estimated 106,000
additional hours on permits at a cost of $4.9 million.
The final scenario involves only sources that are required to get a title V permit for
emissions other than GHG and that are required to add GHG related requirements. Under this
scenario, only the annual issuance of 50 permits noted in the Title VICR are expected to need
the inclusion of GHG related requirements to the permits. The additional burden to permitting
authorities under this scenario is estimated at 27 million hours at a cost of $1.3 million.
4. Burden Relief Estimates for Permitting Authorities and Sources at Several Possible
GHG Major Source Applicability Thresholds for Title V and PSD
The following tables indicate the estimated burden relief when comparing the baseline
levels with several threshold levels for GHG applicability as described in the previous sections.
In Tables 4-1 through 4-4, the first three columns indicate the cost per permit and total cost to
permitting authorities at a GHG threshold level equal to the statutory threshold levels for title V
and PSD (100 and 100/250 tpy, respectively). The next three columns reflect the estimated costs
for permitting authorities with the permitting thresholds (both for PSD and title V) set at the
specified levels. In the final three columns, the burden relief is estimated - the time and costs
alleviated relative to the baseline levels by establishing several GHG permitting thresholds as
previously described.
The burden relief for sources at the different permitting thresholds is presented in Tables
4-5, 4-6, and 4-7 below. Table 4-8 estimates the cost savings if a non-GHG based related trigger
is used. This information on burden relief was used to compile the final Regulatory Impact
Analysis (RIA) for the final GHG tailoring rule. Please see the final RIA contained in the public
31
-------
docket for this GHG tailoring rule for a full explanation and description of the burden relief
provided by the final GHG tailoring rule actions.
32
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Table 4-1. Estimated Burden Relief for Permitting Authorities Utilizing a 25,000 tpy Major/ 25,000 tpy PSD Significance Threshold
Activity
All Title V lOOtpy and PSD 250 tpy
Cost per
Permit
(2007$)
Number
of
Permits
Total Cost
(2007$)
25,000 tpy or Greater
Cost
per
Permit
(2007$)
Number
of
Permits
Total Cost
(2007$)
Avoided Burden
Cost
per
Permit
(2007$)
Number
of
Permits
Total Cost
(2007$)
Title V Permits
New Industrial - Due to GHG
Current Industrial - Add GHG
New Commercial/Residential
Permit Revisions - Due to GHG
Permit Revisions - Add GHG
Permit Renewals
Total Permits Affected
$19,688
$1,978
$9,844
$1,840
$184
$414
71,829
50
1,985,948
61,836
448
2,614
2,122,725
$1,414,175,915
$98,900
$19,549,672,112
$113,778,240
$82,432
$1,082,196
$19,688
$1,978
$9,844
$1,840
$184
$414
2,103
50
444
9,197
448
2,614
14,856
$41,403,864
$98,900
$4,370,736
$16,922,480
$82,432
$1,082,196
$19,688
$1,978
$9,844
$1,840
$184
$414
69,726
0
1,985,504
52,639
0
0
2,107,869
$1,372,772,051
$0
$19,545,301,376
$96,855,760
$0
$0
PSD Permits
New Industrial
New Commercial/Residential
Current Applications - Add GHG
Total Permits Affected
Total Permitting Authority Costs
$23,243
$16,216
$3,861
26,089
55,509
688
82,286
$606,386,627
$900,133,944
$2,656,368
$22,588,066,734
$23,243
$16,216
$3,861
9,197
63
688
9,948
$213,765,871
$1,021,608
$2,656,368
$281,404,455
$23,243
$16,216
$3,861
16,892
55,446
0
72,338
$392,620,756
$899,112,336
$0
$22,306,662,279
33
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Table 4-2. Estimated Burden Relief for Permitting Authorities Utilizing a 50,000 tpy Major/50,000 tpy PSD Significance Threshold
Activity
All Title V lOOtpy and PSD 250 tpy
Cost per
Permit
(2007$)
Number
of Permits
Total Cost
(2007$)
50,000 tpy or Greater
Cost
per
Permit
(2007$)
Number
of
Permits
Total Cost
(2007$)
Avoided Burden
Cost
per
Permit
(2007$)
Number
of
Permits
Total Cost
(2007$)
Title V Permits
New Industrial - Due to GHG
Current Industrial - Add GHG
New Commercial/Residential
Permit Revisions - Due to GHG
Permit Revisions - Add GHG
Permit Renewals
Total Permits Affected
$19,688
$1,978
$9,844
$1,840
$184
$414
71,829
50
1,985,948
61,836
448
2,614
2,122,725
$1,414,175,915
$98,900
$19,549,672,112
$113,778,240
$82,432
$1,082,196
$19,688
$1,978
$9,844
$1,840
$184
$414
981
50
208
1,906
448
2,614
6,207
$19,313,928
$98,900
$2,047,552
$3,507,040
$82,432
$1,082,196
$19,688
$1,978
$9,844
$1,840
$184
$414
70,848
0
1,985,740
59,930
0
0
2,116,518
$1,394,861,987
$0
$19,547,624,560
$110,271,200
$0
$0
PSD Permits
New Industrial
New Commercial/Residential
Current Applications - Add GHG
Total Permits Affected
Total Permitting Authority Costs
$23,243
$16,216
$3,861
26,089
55,509
688
82,286
$606,386,627
$900,133,944
$2,656,368
$22,588,066,734
$23,243
$16,216
$3,861
1,906
28
688
2,622
$44,301,158
$454,048
$2,656,368
$73,543,622
$23,243
$16,216
$3,861
24,183
55,481
0
79,664
$562,085,469
$899,679,896
$0
$22,514,523,112
34
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Table 4-3. Estimated Burden Relief for Permitting Authorities Utilizing a 100,000 tpy Major/75,000 tpy PSD Significance Threshold
Activity
All Title V lOOtpy and PSD 250 tpy
Cost per
Permit
(2007$)
Number
of Permits
Total Cost
(2007$)
100,000 t
Cost
per
Permit
(2007$)
py; 75,000 tpy or Greater
Number
of
Permits
Total Cost
(2007$)
Avoided Burden
Cost
per
Permit
(2007$)
Number
of
Permits
Total Cost
(2007$)
Title V Permits
New Industrial - Due to GHG
Current Industrial - Add GHG
New Commercial/Residential
Permit Revisions - Due to GHG
Permit Revisions - Add GHG
Permit Renewals
Total Permits Affected
$19,688
$1,978
$9,844
$1,840
$184
$414
71,829
50
1,985,948
61,836
448
2,614
2,122,725
$1,414,175,915
$98,900
$19,549,672,112
$113,778,240
$82,432
$1,082,196
$19,688
$1,978
$9,844
$1,840
$184
$414
172
50
18
915
448
2,614
4,217
$3,386,336
$98,900
$177,192
$1,683,600
$82,432
$1,082,196
$19,688
$1,978
$9,844
$1,840
$184
$414
71,657
0
1,985,930
60,921
0
0
2,118,508
$1,410,789,579
$0
$19,549,494,920
$112,094,640
$0
$0
PSD Permits
New Industrial
New Commercial/Residential
Current Applications - Add GHG
Total Permits Affected
Total Permitting Authority Costs
$23,243
$16,216
$3,861
26,089
55,509
688
82,286
$606,386,627
$900,133,944
$2,656,368
$22,588,066,734
$23,243
$16,216
$3,861
915
4
688
1,607
$21,267,345
$64,864
$2,656,368
$30,499,233
$23,243
$16,216
$3,861
25,174
55,505
0
80,679
$585,119,282
$900,069,080
$0
$22,557,567,501
35
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Table 4-4. Estimated Burden Relief for Permitting Authorities Utilizing a Non-GHG Trigger
Activity
All Title V lOOtpy and PSD 250 tpy
Cost per
Permit
(2007$)
Number
of Permits
Total Cost
(2007$)
Non-GHG Trigger
Cost
per
Permit
(2007$)
Number
of
Permits
Total Cost
(2007$)
Avoided Burden
Cost
per
Permit
(2007$)
Number
of
Permits
Total Cost
(2007$)
Title V Permits
New Industrial - Due to GHG
Current Industrial - Add GHG
New Commercial/Residential
Permit Revisions - Due to GHG
Permit Revisions - Add GHG
Permit Renewals
Total Permits Affected
$19,688
$1,978
$9,844
$1,840
$184
$414
71,829
50
1,985,948
61,836
448
2,614
2,122,725
$1,414,175,915
$98,900
$19,549,672,112
$113,778,240
$82,432
$1,082,196
$19,688
$1,978
$9,844
$1,840
$184
$414
0
50
0
0
448
2,614
3,112
$0
$98,900
$0
$0
$82,432
$1,082,196
$19,688
$1,978
$9,844
$1,840
$184
$414
71,829
0
1,985,948
61,836
0
0
2,119,613
$1,414,175,915
$0
$19,549,672,112
$113,778,240
$0
$0
PSD Permits
New Industrial
New Commercial/Residential
Current Applications - Add GHG
Total Permits Affected
Total Permitting Authority Costs
$23,243
$16,216
$3,861
26,089
55,509
688
82,286
$606,386,627
$900,133,944
$2,656,368
$22,588,066,734
$23,243
$16,216
$3,861
0
0
688
688
$0
$0
$2,656,368
$3,919,896
$23,243
$16,216
$3,861
26,089
55,509
0
81,598
$606,386,627
$900,133,944
$0
$22,584,146,838
36
-------
Table 4-5. Estimated Burden Relief for Sources Utilizing a 25,000 tpy Major/25,000 tpy PSD Significance Threshold
Activity
All Title V lOOtpy and PSD 250 tpy
Cost per
Permit
(2007$)
Number
of
Permits
Total Cost
(2007$)
25,000 tpy or Greater
Cost
per
Permit
(2007$)
Number
of
Permits
Total Cost
(2007$)
Avoided Burden
Cost
per
Permit
(2007$)
Number
of
Permits
Total Cost
(2007$)
Title V Permits
New Industrial - Due to GHG
Current Industrial - Add GHG
New Commercial/Residential
Permit Revisions - Due to GHG
Permit Revisions - Add GHG
Permit Renewals
Total Permits Affected
$46,350
$4,440
$23,175
$1,677
$156
$780
71,829
50
1,985,948
61,836
448
2,614
2,122,725
$3,329,289,600
$222,000
$46,024,344,900
$103,698,972
$69,888
$2,038,920
$46,350
$4,440
$23,175
$1,677
$156
$780
2,103
50
444
9,197
448
2,614
14,856
$97,474,050
$222,000
$10,289,700
$15,423,369
$69,888
$2,038,920
$46,350
$4,440
$23,175
$1,677
$156
$780
69,726
0
1,985,504
52,639
0
0
2,107,869
$3,231,815,550
$0
$46,014,055,200
$88,275,603
$0
$0
PSD Permits
New Industrial
New Commercial/Residential
Current Applications - Add GHG
Total Permits Affected
Total Source Costs
$84,530
$59,152
$21,669
26,089
55,509
688
82,286
$2,205,303,170
$3,283,468,368
$14,908,272
$54,963,344,090
$84,530
$59,152
$21,669
9,197
63
688
9,948
$777,422,410
$3,726,576
$14,908,272
$921,575,185
$84,530
$59,152
$21,669
16,892
55,446
0
72,338
$1,427,880,760
$3,279,741,792
$0
$54,041,768,905
37
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Table 4-6. Estimated Burden Relief for Sources Utilizing a 50,000 tpy Major/50 ,000 tpy PSD Significance Threshold
Activity
All Title V lOOtpy and PSD 250 tpy
Cost per
Permit
(2007$)
Number
of
Permits
Total Cost
(2007$)
50,000 tpy or Greater
Cost
per
Permit
(2007$)
Number
of
Permits
Total Cost
(2007$)
Avoided Burden
Cost
per
Permit
(2007$)
Number
of
Permits
Total Cost
(2007$)
Title V Permits
New Industrial - Due to GHG
Current Industrial - Add GHG
New Commercial/Residential
Permit Revisions - Due to GHG
Permit Revisions - Add GHG
Permit Renewals
Total Permits Affected
$46,350
$4,440
$23,175
$1,677
$156
$780
71,829
50
1,985,948
61,836
448
2,614
2,122,725
$3,329,289,600
$222,000
$46,024,344,900
$103,698,972
$69,888
$2,038,920
$46,350
$4,440
$23,175
$1,677
$156
$780
981
50
208
1,906
448
2,614
6,207
$45,469,350
$222,000
$4,820,400
$3,196,362
$69,888
$2,038,920
$46,350
$4,440
$23,175
$1,677
$156
$780
70,848
0
1,985,740
59,930
0
0
2,116,518
$3,283,820,250
$0
$46,019,524,500
$100,502,610
$0
$0
PSD Permits
New Industrial
New Commercial/Residential
Current Applications - Add GHG
Total Permits Affected
Total Source Costs
$84,530
$59,152
$21,669
26,089
55,509
688
82,286
$2,205,303,170
$3,283,468,368
$14,908,272
$54,963,344,090
$84,530
$59,152
$21,669
1,906
28
688
2,622
$161,114,180
$1,656,256
$14,908,272
$233,495,628
$84,530
$59,152
$21,669
24,183
55,481
0
79,664
$2,044,188,990
$3,281,812,112
$0
$54,729,848,462
38
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Table 4-7. Estimated Burden Relief for Sources Utilizing a 100,000 tpy Major/75,000 tpy PSD Significance Threshold
Activity
All Title V lOOtpy and PSD 250 tpy
Cost per
Permit
(2007$)
Number
of
Permits
Total Cost
(2007$)
100,000 tpy; 75,000 tpy or Greater
Cost
per
Permit
(2007$)
Number
of
Permits
Total Cost
(2007$)
Avoided Burden
Cost
per
Permit
(2007$)
Number
of
Permits
Total Cost
(2007$)
Title V Permits
New Industrial - Due to GHG
Current Industrial - Add GHG
New Commercial/Residential
Permit Revisions - Due to GHG
Permit Revisions - Add GHG
Permit Renewals
Total Permits Affected
$46,350
$4,440
$23,175
$1,677
$156
$780
71,829
50
1,985,948
61,836
448
2,614
2,122,725
$3,329,289,600
$222,000
$46,024,344,900
$103,698,972
$69,888
$2,038,920
$46,350
$4,440
$23,175
$1,677
$156
$780
172
50
18
915
448
2,614
4,217
$7,972,200
$222,000
$417,150
$1,534,455
$69,888
$2,038,920
$46,350
$4,440
$23,175
$1,677
$156
$780
71,657
0
1,985,930
60,921
0
0
2,118,508
$3,321,317,400
$0
$46,023,927,750
$102,164,517
$0
$0
PSD Permits
New Industrial
New Commercial/Residential
Current Applications - Add GHG
Total Permits Affected
Total Source Costs
$84,530
$59,152
$21,669
26,089
55,509
688
82,286
$2,205,303,170
$3,283,468,368
$14,908,272
$54,963,344,090
$84,530
$59,152
$21,669
915
4
688
1,607
$77,344,950
$236,608
$14,908,272
$104,744,443
$84,530
$59,152
$21,669
25,174
55,505
0
80,679
$2,127,958,220
$3,283,231,760
$0
$54,858,599,647
39
-------
Table 4-8. Estimated Burden Relief for Sources Utilizing a Non-GHG Trigger
Activity
All Title V lOOtpy and PSD 250 tpy
Cost per
Permit
(2007$)
Number
of Permits
Total Cost
(2007$)
Non-GHG Trigger
Cost
per
Permit
(2007$)
Number
of
Permits
Total Cost
(2007$)
Avoided Burden
Cost
per
Permit
(2007$)
Number
of
Permits
Total Cost
(2007$)
Title V Permits
New Industrial - Due to GHG
Current Industrial - Add GHG
New Commercial/Residential
Permit Revisions - Due to GHG
Permit Revisions - Add GHG
Permit Renewals
Total Permits Affected
$46,350
$4,440
$23,175
$1,677
$156
$780
71,829
50
1,985,948
61,836
448
2,614
2,122,725
$3,329,289,600
$222,000
$46,024,344,900
$103,698,972
$69,888
$2,038,920
$46,350
$4,440
$23,175
$1,677
$156
$780
0
50
0
0
448
2,614
3,112
$0
$222,000
$0
$0
$69,888
$2,038,920
$46,350
$4,440
$23,175
$1,677
$156
$780
71,829
0
1,985,948
61,836
0
0
2,119,613
$3,329,289,600
$0
$46,024,344,900
$103,698,972
$0
$0
PSD Permits
New Industrial
New Commercial/Residential
Current Applications - Add GHG
Total Permits Affected
Total Source Costs
$84,530
$59,152
$21,669
26,089
55,509
688
82,286
$2,205,303,170
$3,283,468,368
$14,908,272
$54,963,344,090
$84,530
$59,152
$21,669
0
0
688
688
$0
$0
$14,908,272
$17,239,080
$84,530
$59,152
$21,669
26,089
55,509
0
81,598
$2,205,303,170
$3,283,468,368
$0
$54,946,105,010
40
-------
APPENDIX A
Table A-1. Newly Major Affected Source Estimates Based on Threshold Level
Source Type
EGUs
Industrial
Oil/Gas/Coal production
Waste Treatment
Commercial
Residential
Total
1 00/250 tpy PSD
285
141,160
2,588
3,344
731,477
182,350
1 00 tpy Title V
285
170,910
2,588
3,358
1,355,921
4,535,500
1,061,204 6,068,562
25,000 tpy
124
4,002
187
1,927
1,161
160
7,561
50,000 tpy
0
1,934
75
910
600
20
3,539
100,000 tpy
0
256
52
193
51
0
552
Based on information contained in the "Technical Support Document for Greenhouse Gas Emissions Thresholds Evaluation;" Office of Air
Quality Policy and Standards; March 29, 2010 and information retrieved from EPA's enforcement and compliance history online (ECHO)
database during January 2010. ECHO is a computer-data based created and maintained by the EPA that contains source-specific data submitted
primarily by state and local environmental agencies. See http://www.epa-echo.gov/echo/index.html.
41
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United States Office of Air Quality Planning and Publication No. EPA-
Environmental Protection Standards 452/R-10-003
Agency Health and Environmental Impacts April 2010
Division
Research Triangle Park, NC
42
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