Uniform Standards Pave Path for Greater Regulatory Burden

Proposed Uniform Standards

On March 26, 2012, the U.S. Environmental Protection Agency (EPA) proposed in the Federal Register 40 Code of Federal Regulations (CFR) Part 65, Subpart I (Storage Vessels and Transfer Operations), Subpart J (Equipment Leaks) and Subpart M (Closed Vent Systems and Control Devices), collectively referred to as the Uniform Standards.1  Additionally, EPA proposed revisions to the general provisions of Part 65, which are contained in Subpart H of 40 CFR 65.  Comments on the proposed Uniform Standards were initially required to be received on or before June 25, 2012, however, on June 18, 2012, EPA issued a 90-day extension for receipt of comments in response to requests from the American Petroleum Institute (API) and the American Chemistry Council (ACC).2

New Approach for Setting Emissions Standards

The intent of the Uniform Standards is to streamline the standards for specific source categories (i.e., transfer racks, storage vessels, equipment leaks, closed vent systems, and control devices) within the chemical and refining sectors including all subsectors such as pharmaceuticals and oil and gas.  The streamlining would be applied when EPA opens regulations for revision within New Source Performance Standards (NSPS), 40 CFR 60, and the National Emission Standards for Hazardous Air Pollutants , 40 CFR 61 and 40 CFR 63.  Furthermore, EPA potentially could apply these regulations to air portions of the Resource Conservation Recovery Act (RCRA) contained within 40 CFR 263 and 264, Subparts AA (Process Vents), BB (Equipment Leaks), and CC (Tanks, Surface Impoundments, and Containers).  In the preamble to the proposed regulations, EPA described the logic behind this approach noting the following benefits:3

  • Providing one-stop requirements for equipment leaks, storage tanks and control devices for the chemical manufacturing and refining industries
  • Providing strengthened control and monitoring requirements based on cost effective advances in technology that could be considered for adoption in future rulemakings
  • Reducing unnecessary and unproductive regulatory burden

Currently, Part 65 contains Subparts A (General Provisions), C (Storage Vessels), D (Process Vents), E (Transfer Racks), F (Equipment Leaks), and G (Closed Vent Systems, Control Devices, and Routing to a Fuel Gas System or Process), which are commonly referred to as the Consolidated Air Rule (CAR).  However, unlike the CAR, the Uniform Standards would not be an option that facilities would select to comply as is per the current function of the CAR.  At present, the subparts contained within Parts 60, 61, and 63 allow in most cases for facilities to comply with the CAR instead of complying with the specific source type standards contained within the applicable subpart or section of the subpart.  Instead, the Uniform Standards would be the location of the detailed standard requirements and would be incorporated by reference in the specific subpart to which a facility would be subject.  For instance, 40 CFR 60, Subpart GGG (NSPS GGG) incorporates the requirements of 40 CFR 60, Subpart VV (NSPS VV) and provides a few variations and additional exemptions.  Additionally, 40 CFR 60, Subpart OOOO (NSPS OOOO) incorporates 40 CFR 60, Subpart VVa (NSPS VVa) with some variations and additional exemptions in similar fashion to 40 CFR 60, Subpart KKK incorporating NSPS VV with some variations and additional exemptions.  This is also very typical in the requirements provided in 40 CFR 61 and 63.  Many of the chemical (e.g., HON, MON, Pharma MACT) and refining (e.g., Refinery MACT I) applicable subparts reference 40 CFR 63, Subparts H, UU, or TT or NSPS VV for equipment leak standards. 

Once an applicable subpart has been reopened for cause, which includes being opened for reconsiderations or periodic residual risk review, upon promulgation of the Uniform Standards, EPA’s current intent would be to incorporate by reference the applicable Uniform Standards subparts with potential variations and exemptions in similar to fashion to what is currently done when incorporating equipment leak standards by referencing 40 CFR 63, Subparts H, UU, or TT or NSPS VV or NSPS VVa.

Therefore, there will actually be two comment periods for the Uniform Standards―one for the proposed rule and another for when the specific subparts will reference the Uniform Standards. However, in the second comment period, the comments would more than likely deal with the variations and exemptions to the Uniform Standards for a given subpart and not necessarily the Uniform Standards in and of themselves.

According to the preamble to the Uniform Standards, EPA developed the proposed standards for storage tanks (40 CFR 65, Subpart I) based on its review of technology that provides the best level of emission reduction for which costs are considered “reasonable.”  EPA used the requirements in 40 CFR 63, Subpart UU (MACT UU) as a starting point for the equipment leak provisions (40 CFR 65, Subpart J) in the proposed uniform standards.  Furthermore, the proposed standards for control devices and closed vent systems (40 CFR 65, Subpart M) are generally based on requirements in 40 CFR 63, Subpart SS (MACT SS). 

EQ Fall 2012 Uniform Standards_graphic
Key Differences between Proposed Uniform Standards and Existing Regulations

There are a lot differences between the proposed Uniform Standards and existing regulations.  The following are some differences between the Uniform Standards and current promulgated regulations:

Subpart I – Storage Tanks

  •  Applicability of Subpart I is based solely on  whether equipment stores or transfers regulated materials, whereas  other rules have exemptions based on material vapor pressure and vessel size.  
  • All fixed roof tanks, regardless of tank capacity and vapor pressure of regulated material stored, will require annual  Method 21 monitoring (or semiannual optical gas imaging) for monitoring fugitive emissions from tank fittings. 
  • In lieu of performing annual Method 21 fugitive emissions monitoring on fixed roof tanks, semiannual optical gas  imaging was proposed as an option.  However, the optical gas imaging protocol has not yet been established by EPA.  Thus, there may be numerous technical and resource uncertainties associated with the implementation of using optical  gas imaging as a practical compliance option. 
  • Uniform Standards propose requirement for alarms (audible or visual) to warn of an impending floating roof landing and  possible overfilling of a tank.
  • The proposed rule has proposed time limits on the duration for which a floating roof can be landed.   

Subpart I – Transfer Operations

  • Proposed rule requires submerge fill or bottom fill for all transfer operations of regulated material.
  • Applicability criteria for emission controls for transfer operations is on a “facility-wide” basis compared to a  “transfer rack” basis in other federal emission standards reviewed.
  • The facility-wide applicability criteria would impose emission control requirements to all transfer racks at an affected source.
  • Proposed rule requires all vapor connections and lines in a vapor balancing systems to be equipped with closures that  seal upon disconnect – this is not a requirement in the other rules reviewed.

Subpart J – Equipment Leaks

  • Inclusion of “all components located within the fence line of the plant site” in the definition of process units subject to Leak Detection and Repair (LDAR) provisions in Subpart J significantly expands equipment subject to LDAR in  other rules. 
  • Uniform Standards specify that delay of repair cannot extend past five years – this is not a requirement in the existing regulations reviewed. 
  • The proposed rule requires sensory monitoring of equipment operating less than 300 hours per year.  Depending on the  rule, such equipment is at times exempt from LDAR monitoring requirements. 
  • The proposed rule requires Method 21 monitoring of potential open-ended valves and lines (specifically cap, blind  flange, plug or second valve) initially upon installation, annually, and as requested.  This monitoring is not required by other rules.  
  • The Uniform Standards requires demonstration that equipment is in vacuum service, and therefore exempt from LDAR, by  installing a continuous pressure monitoring system and alarms. 
  • The monitoring frequency requirements for valves in the proposed standard are similar to those in HON/Subpart UU,
     except they include a requirement to monitor all valves monthly for the first two months (this frequency of monitoring  is similar to initial monitoring under NSPS VV/VVa) until the percent leaker rate can be established to determine  future monitoring frequency. 
  • The proposed 40 CFR 65, Subpart J does not exempt pumps, compressor seals and agitator seals that are routed   to a process or fuel gas system or equipped with a closed vent system that captures and transports leakage from the equipment to a control device (unlike other rules that exempt this equipment). 
  • Closed vent systems and fuel gas systems must be monitored via Method 21 annually.  Current LDAR standards only  require Method 21 monitoring to be done annually for closed vent systems if hard-piped. No specific standards are  provided for fuel gas systems under current regulations.  Additionally, difficult-to-inspect systems must be monitored  annually, which is be more frequently than the current standard requirement of once every 5 years. 
  • Further, the proposed rule specifies that any instrument reading ≥ 500 ppm on equipment in closed vent systems   (CVSs) and fuel gas systems is considered to be a deviation. 
  •  If the referencing subpart prohibits releases from pressure release devices (PRDs) to the atmosphere, the proposed  standards require that PRDs be equipped with devices capable of identifying and recording the time and duration  of a release as well as the calculation of the quantity of regulated material emitted during each release. 
  • The proposed standards require sensory monitoring for more equipment than the other rules reviewed including   equipment in heavy liquid service and instrumentation systems. 
  • The proposed standards require installation of low leak technology on valves and connectors for which repair is  delayed and also requires recordkeeping for delay or repair that involves a calculation showing that the purged  material resulting from an immediate repair exceed the fugitive emissions likely to result from the delay of repair.
  • According to the preamble, EPA elected not to allow pressure testing for batch operations which is included in other LDAR regulations.
  • The proposed standard states in regulated service will be 5 weight percent of regulated material. This would   potentially impact all NSPS (as well RCRA) sources as the LDAR applicability threshold is 10 weight percent of   regulated material (e.g., VOC).

Subpart M – Closed Vent Systems to Control Devices

  • Proposed Subpart M does not include monitoring exemptions for pressure relief devices (PRDs), low leg drains, or high  point bleeds. Most existing rules provide exemptions for bypass monitoring by not requiring the installation of flow  indicators or locking car seals on such equipment components.  The proposed rule would expand bypass monitoring to  such components associated with CVS and fuel gas systems.  
  • Requirements proposed under the proposed Uniform Standards will apply at all times.  There are no provisions   for startup, shutdown, or malfunction (SSM).  The proposed rule states that any release from a CVS through a bypass  line that diverts regulated emissions from a control device to the atmosphere is a deviation.  Proposed Subpart M also  does not provide an exemption for equipment such as low leg drains, high point bleeds, analyzer vents, open-ended  valves/lines, and pressure relief valves needed for safety purposes that is provided in most of the existing subparts. 
  •  Small boilers and process heaters (i.e., less than 44 MW) associated with fuel gas systems will also be subject to the proposed control requirements for small boilers and process heaters under 40 CFR 65.724. 
  • The proposed Uniform Standards for control devices contain more prescriptive requirements for CEMS and CPMS that are  not contained in the existing rules. Additionally, the calibration and accuracy requirements in Table 4 of the Uniform  Standards are more stringent than those contained in HON and Subpart SS.
  • As indicated in the rule preamble, Subpart M does not contain requirements for flares because proposed Subparts  I and J reference the general provisions for flares in Subpart A (40 CFR 63.11(b)).  However, EPA is reviewing data  and may propose new flare requirements in Subpart M in a future rulemaking. 
Impact to Industry

The examples provided herein represent only a small portion of the new requirements contained in the proposed Uniform Standards.  The requirements associated with this proposal will pose a significant financial burden to the U.S. refining and chemical industries, with possibly little of the touted benefit of increased regulatory simplicity. 

EPA points out that, while some general economic considerations are addressed with the proposal, cost effectiveness will be evaluated on a more detailed basis for specific industries when referencing subparts are revised in the future to refer to the Uniform Standards.  As a result, alternate applicability criteria may be established for specific industries in the future.  Questions remain as to whether this approach will truly simplify the rules.  Regardless, industry stakeholders have identified sizeable cost impacts that would result from the new requirements proposed in the Uniform Standards.

Equally important to cost and complexity issues, this novel approach to regulation may set the precedent for future regulations.  Future Uniform Standard proposals are already anticipated for process wastewater and flares and may broaden to other source categories and industries.  For now, this proposed rule presents a source of significant uncertainty to the regulated community.  Understanding this new approach and how it may impact existing refineries and petrochemical plants will pose a (potentially costly) challenge in the coming months and years.   

1 Federal Register, Vol. 77, No. 58, March 26, 2012, pp. 17898 – 18050.
2  Federal Register, Vol. 77, No. 117, June 18, 2012, pp. 36248 – 36386.
Federal Register; Vol. 77, No. 58; Monday, March 26, 2012; Proposed Rules; 17903