Several recent policy changes by the Texas Commission on Environmental Quality (TCEQ) will affect air quality permit by rule (PBR) authorization options available under 30 TAC 106. Industries and operations most likely affected include chemical manufacturing, oil and gas processing, and marine terminals that often conduct flaring activities or routinely implement many small fugitive piping component changes to optimize operations.
The recent developments limit the scope and flexibility to use traditionally routine PBR authorizations and could increase the time and cost to develop a PBR authorization. This means that more projects likely will not qualify for a PBR and will need more complex case-by-case new source review (NSR) permits that further increase a project’s permitting timeline, cost, and uncertainty for start of construction while straining TCEQ’s limited resources to issue timely permits. The changes are as follows:
- Flare Policy Shift Imposes New Constraints
A recent TCEQ policy shift affects the emissions from new or existing flares eligible to be authorized under §106.492. This flare PBR policy shift has not been formally announced and is being applied on a case-by-case basis.
For nearly two decades, the TCEQ consistently approved the construction of new flares under PBR §106.492, including the pilot and waste gas streams regardless of the source of the gas streams flowing to the flare. PBR §106.492 has been the preferred industry authorization approach for new flares because PBR §106.492 does not include section-specific mass emission limits, normally does not require registration or approval by TCEQ except in defined cases, and does not require chemical-by-chemical “speciation” of volatile organic compounds (VOC) or products of combustion into specific compounds.
The TCEQ recently started limiting PBR §106.492 to authorizing only construction of a flare and pilot-related emissions. Authorization of post-control waste gas emissions from the flare — even for associated oxides of nitrogen (NOX), carbon monoxide (CO), and sulfur dioxide (SO2) from flaring waste gas — is now expected to be covered under the PBR corresponding to the source of the gas stream being flared. This applies stringent new compound-specific §106.261/262 emission limits to many flared gas streams, including the combustion emissions from flaring those streams. Some flare projects that previously would have been eligible for an unregistered §106.492 PBR would now require a PBR registration, and some flares will not meet the stringent new PBR emission limits. These changes will increase costs and timelines for authorizing flare emissions from affected projects.
- Pending Marine Loading Standard Permit to Prohibit PBR §106.261/262
On Dec. 18, 2020, the TCEQ published the draft “non-rule” Air Quality Standard Permit for Marine Loading Operations. This standard permit would authorize a range of marine terminal sources and supporting equipment, including liquid transfers to or from marine vessels, storage tanks, flares, vapor combustors, other VOC control devices and fugitive piping components.
PBR §106.261/262 contains a key prohibition preventing the use of PBR §106.261/262 for construction of (or changes to) any “facility authorized in another section of this chapter or for which a standard permit is in effect.” Accordingly, the TCEQ has specifically stated that once the published final version of the Marine Loading Operations Standard Permit becomes active, it will effectively prohibit the traditional use of PBR §106.261/262 to authorize all types of marine loading facility emissions covered under the final Standard Permit.
Because of the §106.261/262 prohibition noted above, the final new Marine Loading Operations Standard Permit will effectively replace the simple, flexible and popular PBR §106.261/262 option with a Standard Permit that has, in draft form, proved problematic to apply. The published 69-page draft standard permit contains complex application requirements including stringent new off-property emission impacts constraints.
Based on evaluations of typical small marine terminal projects, the final issued Marine Loading Operations Standard Permit appears likely to be difficult to apply to real marine terminal projects. Therefore, many marine terminal projects will need to apply for more costly and slower case-by-case NSR permits than the traditional PBR §106.261/262 authorization method.
- Required New Spreadsheet Tool Reduces Flexibility
The TCEQ recently published a new spreadsheet workbook for demonstrating compliance with the chemical-specific limits in PBR §106.261/262 registrations. Many facilities rely on routine PBR §106.261/262 registrations for minor projects and fugitive equipment changes. These facilities will need to cover the cost of adapting to the new spreadsheet tool. The new workbook also includes content locking mechanisms that prevent tool optimization and site-specific customization.
The new workbook may streamline PBR registration development and TCEQ review for simple projects; however, individual complex projects with multiple sources, compounds and receptor distances may encounter problems with the current published §106.261/262 workbook. The new workbook will become required by TCEQ policy on April 1, 2021. Increased documentation costs, decreased flexibility, and potential technical problems should be anticipated.
Keeping Pace With Policy Changes
TCEQ’s new policies and application tools will involve additional effort, time and investment by applicants, and will be likely to involve additional regulatory and compliance-related risks to project authorizations.
Working with an experienced Texas air quality consulting partner will help organizations navigate the policy changes, manage the workbook transitions, and prepare projects for successful PBR approval. An experienced partner will apply practical understanding of TCEQ decision-making to manage the evolving risks associated with permit by rule projects.
Staying ahead of ever-changing regulations can make the difference between success and failure. Our permitting specialists integrate the permitting process throughout a project’s life cycle.