New permitting requirements, primarily under US federal operating permits program of Title V of the 1990 Clean Air Act, and the changing scope and extent of air policy and rulemaking have affected US oil terminal operations and challenge today's terminal operator
That was the primary message of John P. Iwanski, regional director for Trinity Consultants, a Dallas-based environmental consulting firm, to the ILTA International Operating Conference in Houston last summer.
Iwanski summarized Title V permit program status, looking at permit conditions from permits issued to terminal operations in several states.
And he reviewed some emerging regulatory issues expected to affect Title V permits issued to bulk terminal operations.
Among these issues are maximum achievable control technology (MACT) standards, the US Environmental Protection Agency's Storage Tank Emission Reduction Partnership Program, recent court actions over the new ambient air quality standards for ozone, and periodic monitoring.
Title V status
Iwanski reviewed the 1990 Clean Air Act Amendments (CAAA) that initiated a federal operating permit program designed to consolidate all of the federal air requirements into a single renewable document.
All of the initial applications have been submitted, and state or local agencies, with federal approval, have begun drafting Title V operating permits. These are required for terminals with potential emissions greater than established thresholds for specified pollutants.
For bulk terminals, said Iwanski, the pollutant of concern is typically volatile organic compounds (VOCs) with Title V thresholds ranging from 10 tons/year (tpy) in extreme ozone non-attainment areas (such as Los Angeles) up to 100 tpy in ozone-attainment areas.
Hazardous-air-pollutant (HAP) emissions may also trigger Title V permitting at bulk terminals, he said, with potential emission thresholds of 10 tpy of any single HAP or 25 tpy of all HAPs.
For some sources, applicants have requested enforceable limitations to limit potential emissions "synthetically," thereby designating these terminals as synthetic minor sources.
Issuance of Title V permits has progressed more slowly than anticipated, however. At mid-2000, such larger industrialized states as Ohio, Illinois, and Michigan had issued only 33% of all Title V permits for which applications had been submitted (Fig. 1).
There may be several reasons the process has proceeded slowly, he said. But, a frequent explanation by state agencies has been about the complicated nature of these permits, some of which have been almost 200 pages long.
Many pages of these permits address periodic monitoring and reporting requirements, certification requirements, and even standardized general permit conditions.
Title V conditions
Once a state agency has drafted a Title V permit, the bulk terminal operator should closely review the entire permit, not overlooking seemingly "boilerplate" conditions because these may contain requirements absent from previous permit documents.
In particular, notice should be taken of the following:
- Preventive maintenance requirements, particularly for control equipment. Some states (Indiana, for example) require a written preventive maintenance plan to be on file within 90 days of the issuance of the Title V permit. In all cases, logging preventive-maintenance activities is now a requirement.
- Emergency notification procedures in an emergency or upset. Emergencies or upsets result in emissions to the atmosphere that exceed permitted limits.
In some states, there is both an initial reporting time limit within hours of the event and a written notification within days of an event. Failure to meet these reporting deadlines constitutes a federal permit violation.
- Permit-shield provisions. Although they limit liabilities for requirements included in the permit, permit-shield provisions specifically do not exempt past liabilities (before the Title V permit) from enforcement actions.
Thus, Iwanski said, skeletons in the closet remain in the closet.
- Reporting of deviations. Some states require written notifications to agencies for deviations from permit terms and conditions.
- Changes affecting the Title V permit. For changes the terminal can make without changing the Title V permit, Iwanski said, operators should be aware that some of these changes may require advance notice to the state agency, even if a construction permit is not required.
- Correction requirements. Permits are issued based on information included in the Title V permit application. If the application information is wrong or has changed, the applicant must inform the agency. If no permit has yet been issued, the applicant must maintain a representative application.
- Maintaining a copy of the permit. In New York, said Iwanski, failure to produce a copy of the permit upon request by the regulatory agency is a violation of the permit. In all instances, terminal operators must know where the permit is filed.
- Permit renewal. Renewal application timelines need to be noted; some states require renewal applications as much as 12 months before expiration.
Title V regulations require that the permit contain adequate periodic-monitoring requirements to assess on-going compliance. Developing a permit that contains adequate monitoring and having terminal operators agree to these terms have been frequently cited, said Iwanski, as another reason for delays in issuing Title V permits.
Some states have developed very detailed monitoring requirements for named control equipment within the permit, including the development of specific plans: a preventive-maintenance plan, a compliance-monitoring plan, and a compliance-response plan.
Other states rely on existing preventive-maintenance records to demonstrate monitoring of proper operations of control equipment. Failure to develop or implement these plans or records can constitute a permit violation, he said.
Some states have tried to make compliance procedures very detailed in permits, often limiting flexibility when devising compliance methodology.
One particular example, common in many states, said Iwanski, is spelling out in explicit detail the source of emission factors that can be used to demonstrate compliance, provided that throughput records are maintained.
EPA's emissions-quantification document, AP-42 Vol. 1, Chapter 7 "Liquid Storage Tanks" (September 1997), may be quoted as an acceptable source of information.
But other questions persist, said Iwanski: Are other emission factors, also well documented, acceptable as well? What if the factors in the permit change over time to the benefit of the terminal? What type of permit change is needed?
An operator should think maximum flexibility for the terminal and include maximum flexibility in the language.
Does the bulk terminal have an adequate system for archiving periodic monitoring records? Now is a good time, before permit issuance, he said, to assess the ability to retain all records and logs related to compliance-monitoring activities for the required 5-year period.
Draft compliance-monitoring provisions in the draft Title V permit should include contingencies for discontinuing monitoring when equipment is shutdown and emissions potential has been eliminated.
Some states have even provided allowances in Title V permits for missing monitoring data when equipment is operating, he said, although these missing-data periods tend to be limited to less than 5% of total operating time.
Operators should not be surprised, he said, to see requirements in the permit that may not have been in previous permits. Good examples include rules related to recycling and emissions reduction of ozone-depleting substances.
And, Iwanski said, any unit-specific information included in the permit should be reviewed closely. Some states, particularly those without electronic permit writing packages, perform data re-entry of information from the application into the permit. Typographical errors can occur.
Every 6 months, the Title V permit holder must submit a report summarizing the required monitoring that was completed according to permit requirements.
The burden of compliance has shifted, said Iwanski; now, the terminal operator is expected to police against noncompliance.
Terminals with small or no environmental staffs must ensure adequate resources are provided not only to complete the required monitoring routinely, but also to file routine, periodic reports summarizing the collected information.
Besides the additional monitoring, record keeping, and reporting required by Title V permits, Iwanski said, probably the single biggest recent change is annual compliance certification by the terminal's responsible official.
Annually, it is the terminal operator's responsibility to certify compliance with each and every applicable requirement included in the Title V permit. The responsible official certifies, under penalty of law, that a system is designed to ensure qualified personnel properly gather and evaluate information that is accurate, complete, and true.
Agencies no longer need to wait for the inspector to discover non compliance. Owners and operators will do it for them.
Following are the specifics of compliance certification:
- Identify each term or condition in the permit.
- Determine compliance status.
- State whether compliance was continuous or intermittent.
- Describe methods used to determine compliance.
Emerging Issues, more changes
Several issues on the horizon may mean changes to Title V permits issued to bulk terminal operations.
Maximum achievable control technology (MACT) standards affect major sources of HAPs. Several standards may apply to terminals that are major HAPs sources.
The organic-liquids-distribution MACT was to have been proposed last month but is still being worked on, EPA's Martha Smith told Oil & Gas Journal. She added that final rule promulgation in October 2001 remains a target.
Iwanski said it will likely address HAP emissions controls from storage vessels, liquid-transfer operations, equipment leaks, emissions from wastewater or other wastes, and blending and packaging operations.
On June 9, 1998, EPA issued a presumptive MACT document, which Iwanski described as "typically a precursor of the proposed rule."
Other MACT standards that may require an applicability review by bulk terminals include:
- Marine vessel loading, and gasoline distribution; promulgation and compliance dates have already occurred for these two MACT rules.
- Site remediation and combustion sources, including boilers, internal-combustion engines, and process heaters; these two MACT rules have yet to be promulgated.
Owner-operators must include applicable MACT requirements in the Title V permit, said Iwanski. Hence, once the organic liquids distribution MACT is finalized, all subject bulk terminals will need to modify their Title V permits.
Slotted guide pole
The Storage Tank Emission Reduction Partnership Program is a compliance-agreement program developed by EPA for companies, including bulk terminals, with aboveground tanks that store volatile organic liquids, said Iwanski.
The program provides a vehicle for elimination of penalties for companies that agree to audit, disclose, and correct leaks in external floating roof storage tanks.
Under a previous enforcement initiative, EPA found frequent noncompliance with regards to slotted guide poles. The slots and spaces between the guide poles and the tank's roof are emission pathways that violate the "no visible gap" provisions included in EPA's New Source Performance regulations.
Key dates for the Storage Tank Emission Reduction Partnership Program are shown in the accompany box.
To take advantage of EPA's offer of penalty elimination, said Iwanski, owners must have registered by June 12, 2000, with a submitted executed participation agreement coming in less than 2 months.
This agreement will then allow installation of acceptable slotted guide pole emissions controls within a 3-year period.
The slotted-guide-pole-emission controls and the requirement for these controls need to be included in a terminal's Title V permit or other federally enforceable permit document.
Iwanski said that state and local agencies are moving forward with designations of attainment status with respect to the new 8-hr ozone standard.
Although court action in 1999 prevented EPA from enforcing these new, more stringent ozone standards, the agency published guidance in March 2000 for states to help determine boundaries of attainment and nonattainment areas with respect to the new standards.
State and local agencies have collected 3 years of ozone data (1997-1999) that will be used in this designation process.
The impact of the new standards on permit requirements (including Title V operating permit requirements) is not yet fully known, he said. Areas already designated nonattainment for ozone (for the 1-hr standard) will likely see no additional operational impacts.
Those areas currently designated as attainment for ozone under the 1-hr standard but nonattainment under the new 8-hr standard, however, may face new local regulations aimed at reducing the formation of ground-level ozone. Any such new regulations will need to be incorporated into the Title V operating permit.
As of mid-2000, EPA was considering developing a new national policy on the 8-hr ozone standard.
The policy, as conceived, would allow an area with a preliminary designation of nonattainment under the new 8-hr ozone standard to delay the effective date of the designation for up to 5 years.
The extension would be granted provided that the state agency and EPA agreed to specific air-quality-improvement measures.
Other court action
As bulk terminals struggled to review and comply with periodic-monitoring conditions including Title V permits, the US Circuit Court of Appeals, District of Columbia, in April 2000 invalidated EPA's Periodic Monitoring Guidance issued in September 1998.
The court determined that the guidance significantly broadened existing Title V permitting rules from 1992 and ordered states not to impose additional monitoring requirements in permits as suggested by the 1998 guidance.
The impact on bulk terminals can be two-fold.
- If a terminal already has been issued a permit and periodic monitoring was included based on EPA's September 1998 guidance, that permit may include excessive monitoring requirements.
- If a terminal has yet to be issued a permit, it needs to be reviewed very closely, when the draft permit is issued, with respect to periodic monitoring conditions.
Given the recent court action, documented arguments against stringent, unreasonable, and inflexible monitoring requirements may be better received and acknowledged by the state and local regulatory agencies.
"In all states, logging preventative maintenance activities is now a requirement [under US regulations based on Title V of the 1990 Clear Air Act Amendments]."
"Besides the additional monitoring, record keeping, and reporting required by Title V permits, the single biggest recent change is annual compliance certification by the terminal's responsible official. . . .The responsible official certifies, under penalty of law, that a system is designed to ensure qualified personnel properly gather and evaluate information that is accurate, complete, and true."