The Texas Commission on Environmental Quality (commission) proposes amendments to §§115.10, 115.720, 115.722, 115.725 - 115.727, 115.729, 115.760, 115.761, 115.764, 115.769, 115.780 - 115.783, and 115.786 - 115.789. The commission also proposes to repeal §§115.766 - 115.768 and 115.785, and proposes new §115.766 and §115.767. These amendments, repeals, and new sections are being proposed in Subchapter A, Definitions; Subchapter H, Highly-Reactive Volatile Organic Compounds, Division 1, Vent Gas Control; Subchapter H, Division 2, Cooling Tower Heat Exchange Systems; and Subchapter H, Division 3, Fugitive Emissions.

The amended, repealed, and new sections are proposed to be submitted to the United States Environmental Protection Agency (EPA) as revisions to the state implementation plan (SIP).

BACKGROUND AND SUMMARY OF THE FACTUAL BASIS FOR THE PROPOSED RULES

The Houston/Galveston/Brazoria ozone nonattainment area (HGA) is classified as Severe-17 under the Federal Clean Air Act Amendments of 1990 (as codified in 42 United States Code (USC), §§7401 et seq .), and therefore, is required to attain the one-hour ozone standard of 0.12 parts per million (125 parts per billion) by November 15, 2007. The HGA consists of Brazoria, Chambers, Fort Bend, Galveston, Harris, Liberty, Montgomery, and Waller Counties, and the commission has been working to develop a demonstration of attainment in accordance with 42 USC, §7410. The most relevant HGA SIP revisions to date are the December 2000 one-hour ozone standard attainment demonstration, the September 2001 follow-up revision, and the December 2002 nitrogen oxides (NO _x )/highly-reactive volatile organic compound (HRVOC) revision.

This process has proven to be extremely challenging due to the magnitude of reductions needed for attainment. The emission reduction requirements included as part of the December 2000 SIP revision represent substantial, intensive efforts on the part of stakeholder coalitions in the HGA, in partnership with the commission, to address ozone. These coalitions include local governmental entities, elected officials, environmental groups, industry, consultants, and the public, as well as EPA and the commission, and worked diligently to identify and quantify control strategy measures for the HGA attainment demonstration.

December 2000

The December 2000 SIP revision contained rules and photochemical modeling analyses in support of the HGA ozone attainment demonstration. The majority of the emissions reductions identified in this revision were from a 90% reduction in point source NO _x . The modeling analysis also indicated a shortfall in necessary NO _x emission reductions, such that an additional 91 tons per day (tpd) of NO _x reductions were necessary for an approvable attainment demonstration. In addition, the revision contained post-1999 rate-of-progress (ROP) plans for the milestone years 2002 and 2005 and for the attainment year 2007, and transportation conformity motor vehicle emissions budgets (MVEB) for NOx and volatile organic compound (VOC) emissions. The SIP also contained enforceable commitments to implement further measures in support of the HGA attainment demonstration, as well as a commitment to perform and submit a midcourse review.

September 2001

The September 2001 SIP revision for the HGA included the following elements: 1) corrections to the ROP table/budget for the years 2002, 2005, and 2007 due to a mathematical inconsistency; 2) incorporation of a change to the idling restriction control strategy to clarify that the operator of a rented or leased vehicle is responsible for compliance with the requirements in situations where the operator of a leased or rented vehicle is not employed by the owner of the vehicle (the commission committed to making this change when the rule was adopted in December 2000); 3) incorporation of revisions to the clean diesel fuel rules to provide greater flexibility for compliance with the requirements of the rule while preserving the emission reductions necessary to demonstrate attainment in the HGA; 4) incorporation of a stationary diesel engine rule that was developed as a result of the state's analysis of EPA's reasonably available control measures; 5) incorporation of revisions to the point source NO _x rules; 6) incorporation of revisions to the emissions cap and trade rules; 7) the removal of the construction equipment operating restriction and the accelerated purchase requirement for Tier 2/3 heavy-duty equipment; 8) the replacement of these rules with the Texas Emission Reduction Plan program; 9) the layout of the midcourse review process that details how the state will fulfill the commitment to obtain the additional emission reductions necessary to demonstrate attainment of the one-hour ozone standard in the HGA; and 10) replacement of the 2007 ROP MVEBs to be consistent with the attainment MVEBs.

As was discussed in the December 2000 revision, the modeling resulted in a 141 parts per billion peak ozone level that correlated to a shortfall calculation of 91 tpd NO _x equivalent emissions. An additional five tpd was added to the shortfall, because the state could not take credit for the NO _x reductions associated with the diesel pull-ahead strategy. The excess emissions from this strategy were not included in the original emissions inventory. The gap control measures adopted in December 2000, along with the stationary diesel engine rules included in the September 2001 revision, resulted in NO _x reductions of 40 tpd, which left a total remaining shortfall of 56 tpd. The state committed to address this shortfall through the midcourse review process.

December 2002

In January 2001, the Business Coalition for Clean Air--Appeal Group (BCCA-AG) and several regulated companies challenged the December 2000 HGA SIP and some of the associated rules. Specifically, the BCCA-AG challenged the 90% NOx reduction requirement from stationary sources in the HGA. In May 2001, the parties agreed to a stay in the case, and Judge Margaret Cooper, Travis County District Court, signed a consent order, effective June 8, 2001, requiring the commission to perform an independent, thorough analysis of the causes of rapid ozone formation events and identify potential mitigating measures not yet identified in the HGA attainment demonstration, according to the milestones and procedures in Exhibit C (Scientific Evaluation) of the order.

In compliance with the consent order, the commission conducted a scientific evaluation based in large part on aircraft data collected by the Texas 2000 Air Quality Study (TexAQS). The TexAQS, a comprehensive research project conducted in August and September 2000 involving more than 40 research organizations and over 200 scientists, studied ground-level ozone air pollution in the HGA and East Texas regions. The study revealed that while industrial source NOx emissions were generally correctly accounted for, industrial source VOC emissions were likely significantly understated in earlier emissions inventories. The study also showed that surface monitors were insufficient to capture the phenomenon of ozone plumes downwind of industrial facilities. On four separate days, aircraft instruments recorded ozone levels exceeding 125 parts per billion that were missed by surface monitoring equipment. The findings from the study are constantly evolving and have raised questions about the formation of high ozone levels in the HGA.

To address these findings and to fulfill obligations in the consent order, the commission adopted a SIP revision in December 2002 that focused on replacing the most stringent 10% industrial NO _x reductions with VOC controls. In light of the TexAQS study, the commission conducted further modeling analysis of ambient VOC data. The results of photochemical grid modeling and analysis indicated that the same level of air quality benefits achieved with a 90% industrial NO _x emissions reduction could be achieved with an overall 80% industrial NO _x emissions reduction when combined with an industrial VOC emissions reduction. This conclusion was based on results from several studies, including photochemical grid modeling of the August-September 2000 episode using a top-down emissions inventory adjustment to point source HRVOC emissions, and analyses of ambient HRVOC measurements made by commission automated gas chromatographs and airborne canisters using the maximum incremental reactivity and hydroxyl reactivity scales. Four HRVOCs (ethylene, propylene, 1,3-butadiene, and butenes) clearly play important roles in the HGA ozone formation, and these four seemed to be the best candidates for the first round of HRVOC controls.

In order to address these scientific findings, the commission adopted revisions to the industrial source control requirements, one of the control strategies within the existing federally approved SIP. The December 2002 revision contains new rules to reduce HRVOC emissions from four key industrial sources: fugitives, flares, process vents, and cooling towers. The adopted rules target HRVOCs while maintaining the integrity of the SIP. Analysis showed that limiting emissions of ethylene, propylene, 1,3-butadiene, and butenes in conjunction with an 80% reduction in NO _x is equivalent in terms of air quality benefit to that resulting from a 90% point source NOx reduction requirement. As such, the HRVOC rules are performance-based, emphasizing monitoring, recordkeeping, reporting, and enforcement, rather than establishing individual unit emission rates.

The technical support documentation accompanying the revision contains the supporting analysis for early results from ongoing analysis examining whether reductions in HRVOC emissions could replace the last 10% of industrial NO _x controls with a reduction of approximately 64% in industrial HRVOC emissions, while ensuring that the air quality specified in the approved December 2000 HGA SIP is met.

Current SIP Revision

As mentioned previously, the commission committed to perform a midcourse review to ensure attainment of the one-hour ozone standard. The midcourse review process provides the ability to update emissions inventory data, utilize current modeling tools, such as MOBILE6, and enhance the photochemical grid modeling. The data gathered from the TexAQS continues to improve photochemical modeling of the HGA. The collection of these technical improvements give a more comprehensive understanding of the ozone challenge in the HGA that is necessary to develop an attainment plan. In the early part of 2003, the commission was preparing to move forward with the midcourse review; however, during the same time period EPA announced its plans to begin implementation of the eight-hour ozone standard. The EPA published proposed rules for implementation of the eight-hour ozone standard in the June 2, 2003 issue of the Federal Register (68 FR 32802). In the same time frame, EPA also formalized its intentions to designate areas for the eight-hour ozone standard by April 15, 2004, meaning states would need to reassess their efforts and control strategies to address this new standard by 2007. Recognizing that existing one-hour nonattainment areas would soon be subject to the eight-hour ozone standard, and in an effort to efficiently manage the state's limited resources, the commission decided to develop an approach that addresses the outstanding obligations under the one-hour ozone standard while beginning to analyze eight-hour ozone issues.

The commission's one-hour ozone SIP commitments include: 1) completing a one-hour ozone midcourse review; 2) performing modeling; 3) adopting measures sufficient to fill the NO _x shortfall; 4) adopting measures sufficient to demonstrate attainment; and 5) revising the MVEB using MOBILE6.

Results from the TexAQS and recent photochemical modeling indicate that additional HRVOC reductions will be the most beneficial measure to reduce ozone in the HGA. The commission is proposing to reduce HRVOC emissions to reach attainment of the one-hour ozone standard. The photochemical modeling of the August-September 2000 episode coupled with a weight-of-evidence argument demonstrates attainment of the one-hour ozone standard. To achieve the necessary HRVOC reductions, the commission is proposing a two-pronged approach that would address variable short-term emissions through a not-to-exceed limit, and would address steady-state and routine emissions through an annual cap. The annual HRVOC cap in Harris County would be reduced from the existing HRVOC cap in order to support the attainment demonstration modeling. The annual HRVOC cap in the seven-county surrounding area is equivalent to the total emissions limits established in the December 2002 SIP revision, but represented on an annual basis instead of a 24-hour rolling average. The commission will continue to evaluate the necessity to require short-term and annual reductions from those sites subject to Chapter 115, Subchapter H, Divisions 1 and 2, that are located within the seven-county surrounding area. If the evaluation demonstrates that reductions from these counties have little impact on attainment of the one-hour ozone standard, the short-term and annual limits for those other seven counties may no longer be required. The commission also solicits comments on possible ways to mitigate violations of the short-term emissions cap.

The annual HRVOC cap emissions would be distributed and enforced through an HRVOC emissions cap and trade program under 30 TAC Chapter 101, Subchapter H, new Division 6 (Highly-Reactive Volatile Organic Compound Emissions Cap and Trade Program) being proposed in concurrent rulemaking. This program would establish a mandatory annual HRVOC emissions cap on all sites located in the HGA that emit or have the potential to emit more than ten tons per year of HRVOC, and that are subject to the HRVOC control requirements of Chapter 115, Subchapter H, Division 1 or Division 2. The cap would be enforced by the allocation, trading, and banking of allowances. An allowance is the equivalent of one ton of HRVOC emissions. This HRVOC cap would be established at levels demonstrated as necessary to allow the HGA to attain the one-hour ozone standard. The proposed cap would initially be implemented on April 1, 2006. The proposed HRVOC cap and trade program would also require all sites with new or modified HRVOC sources in the HGA to obtain unused allowances from other sites already participating under the cap to offset any increased HRVOC emissions. For sites that have the potential to emit ten tons per year or less of HRVOCs from sources subject to the HRVOC control requirements of Subchapter H, Division 1 or 2, the total aggregate HRVOC emissions from those sources would be limited to ten tons per year. Sites that are exempt from the HRVOC emissions cap and trade program would be extended an opportunity to opt-in, receive an HRVOC allocation, and thereby not be restricted to the ten tons per year limit.

The HGA SIP no longer relies solely on NO _x -based strategies. A combination of point source HRVOC controls and NO _x reductions appear to be the most effective means of reducing ozone in the HGA and there is no longer a NO _x shortfall in the HGA SIP. The commission also evaluated a number of the existing control strategies that were put in place in the December 2000 revision. The photochemical modeling shows that some of these strategies are no longer necessary to attain the one-hour ozone standard. This SIP revision is proposing the repeal of the commercial lawn and garden equipment restrictions, the repeal of the heavy-duty vehicle idling restrictions, and the removal of the motor vehicle inspection and maintenance program requirements from Chambers, Liberty, and Waller Counties. In addition, this SIP proposal includes revisions to the environmental speed limit strategy. In September 2002, the commission revised the existing speed limit strategy to suspend the 55 mile per hour (mph) speed limit until May 1, 2005, and, where posted speeds were 65 mph or higher before May 1, 2002, to increase speed limits to five mph below what was posted. The 78th Legislature, 2003, removed the commission's authority to determine speed limits for environmental purposes; therefore, this proposal would remove the reinstatement of the 55 mph speed limit on May 1, 2005, and would maintain the currently posted speed limits at five mph below the posted limit before May 1, 2002. Also, as part of this SIP revision, the commission is proposing new statewide portable fuel container rules. Historically, the commission has expressed a preference to implement technology-based strategies over behavior-altering strategies, and these proposed changes embody that philosophy.

Through this revision, the commission is fulfilling its outstanding one-hour ozone SIP obligations and beginning to plan for the upcoming eight-hour ozone standard. This proposal demonstrates attainment of the one-hour ozone standard in the HGA in 2007 and provides a preliminary analysis of the HGA in terms of the eight-hour ozone standard in 2007 and 2010. EPA's proposed eight-hour implementation rules provide flexibility to the states in transitioning from the one-hour to the eight-hour ozone standard, and the commission believes the steps taken in this proposal and the technical work performed to date will be invaluable through the transition period. Upon EPA's finalization of the eight-hour implementation and the transportation conformity rules, the commission expects to begin developing eight-hour ozone SIPs.

This is to put all interested parties on notice that, although the commission is proposing the following rules, including an annual cap and a short-term limit on HRVOC emissions, the commission may significantly amend these proposed rules at adoption, repropose a portion of these rules, or propose additional rules, as appropriate.

First, the commission continues to analyze the rules for implementation of the eight-hour ozone standard adopted by EPA on April 15, 2004. These rules and their preamble suggest that a demonstration of attainment of the one-hour ozone standard may not be required for the portion of the SIP pertaining to the HGA. This means that the commission will need to review the measures contained in the current proposal to ensure that they are needed in this form in order to demonstrate noninterference. Additional analysis of the impact of the proposed rules on attainment of the eight-hour standard may indicate a need for new or more stringent control measures.

Second, the commission may determine that, if a one-hour attainment demonstration is necessary, additional, different, or more stringent control measures may be needed based on additional modeling. The commission staff continues to model scenarios under the one-hour standard, and the commission may determine that the results indicate a need for changes in control strategies. Moreover, the one-hour attainment demonstration includes a weight-of-evidence argument. Additional review of the issues relating to the weight-of-evidence argument could lead the commission to propose new strategies or to repropose the control strategies proposed today.

Finally, the commission is also concurrently proposing a cap and trade program in Chapter 101, Subchapter H, new Division 6 as a refinement of the annual cap proposed for HRVOC emissions.

SECTION BY SECTION DISCUSSION

General Administrative Rule Language Changes

The commission proposes to change the word "which" to "that" and the word "shall" to "must" in numerous locations in the rule language to conform to the drafting rules in the Texas Legislative Council Drafting Manual , October 2002.

The commission proposes to spell out acronyms the first time they are used in a section and to delete acronyms that are only used once in a section.

SUBCHAPTER A, DEFINITIONS

The proposed amendment to §115.10, concerning Definitions, would add a new definition of "Emergency flare" to differentiate flares that only receive emissions during upset events or unscheduled maintenance, startup, or shutdown activities from other flares. The remaining definitions in §115.10 are proposed to be renumbered accordingly.

The proposed amendment to the definition of "Strippable volatile organic compound" would remove the listing of test methods used to determine the concentration of strippable VOC because the test methods are not necessary to define the term and are already listed in the cooling tower rules.

SUBCHAPTER H, HIGHLY-REACTIVE VOLATILE ORGANIC COMPOUNDS

Division 1, Vent Gas Control

Section 115.720, Applicability and Definitions

The proposed amendment to §115.720(a) would add language to specify that the applicability of this rule includes both controlled and uncontrolled vent gas streams containing HRVOC. A new definition for "Degassing safety device" is proposed in §115.720(b) to address low-flow pilots that are typically permitted as flares, but used only at geologic storage facilities during emergency releases. The remaining definitions in §115.720 are proposed to be renumbered accordingly.

Section 115.722, Site-wide Cap and Control Requirements

The commission proposes to amend this section to allow sites the flexibility of compliance with the vent gas control requirements of this division through compliance with the HRVOC emissions cap and trade program. The proposed amendment to §115.722(a) would change the long-term site-wide cap strategy to a calendar year basis instead of the existing 24-hour rolling average basis, and would state that owners or operators of a site subject to the HRVOC vent gas rules shall comply with the HRVOC emissions cap and trade program in Chapter 101, Subchapter H, Division 6. The proposed amendment to §115.722(a) would also remove the reference to the site-cap limits in the tables of the SIP.

Proposed new §115.722(b) would specify that all sites subject to this division or to Division 2 that are exempt from the HRVOC emissions cap and trade program in accordance with §101.392 (Exemptions) are limited to ten tons of HRVOC emissions per calendar year.

Proposed new §115.722(c) would provide a short-term, not-to-exceed limit, in pounds of HRVOC per one-hour block, for all sites subject to this division. The commission continues to evaluate the magnitude of the short-term limit, and the time period over which this short-term limit would be enforced. The commission solicits comment regarding the appropriate level for this short-term limit, and requests any supporting data regarding alternatives to the magnitude and time period. Proposed new §115.722(c)(3) would address how exceedances of the short-term limits should be calculated to determine compliance with the long-term cap. Existing §115.722(b) and (c) are proposed to be relettered to §115.722(d) and (e), respectively. The proposed amendment to relettered §115.722(d) would correct a citation to 40 Code of Federal Regulations (CFR) §60.18 and add two new paragraphs to specify the methods to demonstrate compliance with the minimum net heating value requirements and the maximum exit velocity requirements. The commission does not propose to require continuous monitoring of potential visible emissions from flares.

Section 115.725, Monitoring and Testing Requirements

The proposed amendment to §115.725(a) would specify that pressure relief valves are not subject to the requirements of §115.725(a). Proposed §115.725(a) would also specify that each vent gas that is not controlled by a flare must be tested. The proposed amendment to §115.725(a) would specify that HRVOC emissions are considered to be zero during non-operational periods for cyclic or batch processes. Additionally, the proposed amendment to §115.725(a) would add requirements in §115.725(a)(1) and (2) for owners or operators to select operational parameters for uncontrolled and controlled vents, monitor those parameters, and establish operating limits based on averages during the tests required by §115.725(a). The process parameter monitoring requirements are necessary to help assure compliance with the site-wide caps in §115.722(c). Proposed new §115.725(a)(3) would require that HRVOC emissions during emissions events and scheduled startup, shutdown, and maintenance activities be determined using either testing or process knowledge and engineering calculations. This requirement is necessary due to the inclusion of emissions from emissions events and scheduled startup, shutdown, and maintenance activities in the site-wide caps in §115.722 and to better assure compliance with the HGA attainment demonstration SIP. Proposed new §115.725(a)(4) would require the owner or operator to develop, implement, and follow written monitoring plans for the operational parameters required under §115.725(a)(1) and (2). Proposed new §115.725(a)(5) would specify that additional testing may be performed to update emission data after the initial HRVOC emission test has been performed, and that test plans for additional testing must be submitted to the executive director at least 45 days prior to testing. Proposed new §115.725(a)(6) would include the provisions currently under §115.725(c), regarding the use of testing performed prior to approval of the test plans, and proposed new §115.725(a)(7) would include the language currently under §115.725(g), regarding test waivers for one-half of the vents that are identical in design and operation.

The proposed amendment to §115.725(b) would specify that the alternatives provided may not be applied to pressure relief valves and that the vent gas stream must comply with the process parameter monitoring requirements of §115.725(a). The proposed amendment to §115.725(b)(1)(B) would specify that cylinder gas audits must be performed at a minimum quarterly, after the initial cylinder gas audit. The proposed amendment in §115.725(b)(2) would specify that process data, "sufficient to demonstrate compliance status" may be used to determine maximum potential HRVOC hourly emissions, and would remove pressure relief valves from the types of processes for which process knowledge may be used. Finally, the proposed amendment to §115.725(b) would include the addition of degassing safety devices in §115.725(b)(2)(D) to the types of processes for which process knowledge may be used in lieu of testing.

Proposed new §115.725(c) would provide monitoring requirements for pressure relief valves, and the proposed new language in §115.725(c)(1) would specify the requirements of the pressure relief valve monitoring system. Proposed new §115.725(c)(2) would specify that the owner or operator may use process knowledge to determine the HRVOC emission rates during events when the pressure relief valves open. Proposed new §115.725(c)(3) would require written monitoring plans for the pressure relief valve monitoring systems, and would specify the requirements of the plans. Finally, proposed new §115.725(c)(4) would specify that the written monitoring plans must be submitted within 30 days upon written request by the executive director, and that the executive director may require additional or alternative monitoring requirements.

The proposed amendment to §115.725(d) would specify that except for subsections (e) - (i), the owner or operator shall perform continuous monitoring in accordance with the requirements of §115.725(d) to demonstrate compliance with §115.722(a) - (d). The proposed amendment to §115.725(d)(2) would revise the calibration requirements for the on-line analyzer. The proposed amendment to §115.725(d)(2)(A)(i) would specify that for HRVOC constituents, the owner or operator must follow the procedures and requirements of 40 CFR Part 60, Appendix B, Section 10 of Performance Specification 9, except as provided for in §115.725(d)(2)(A)(i). Proposed new §115.725(d)(2)(A)(ii) would specify that for the constituents monitoring to determine net heating value and molecular weight, the owner or operator may elect to follow the §115.725(d)(2)(A)(i) calibration requirements or the manufacturer recommended procedures. Proposed new §115.725(d)(2)(A)(ii)(I) would require that if the manufacturer recommended procedures are selected, those procedures must include, at a minimum, weekly calibration checks of the top two non-HRVOC constituents affecting molecular weight and net heating value to meet the performance criteria of Section 10.2 of Performance Specification 9. Proposed new §115.725(d)(2)(A)(ii)(II) would require that manufacturer information and data be submitted with a quality assurance plan (QAP) for those constituents for which routine calibration is not performed. Proposed new §115.725(d)(2)(A)(iii) would specify that the range of calibration standards required for calibration of the on-line analyzer may be based on the typical concentrations instead of the full potential range of concentrations. The language in §115.725(d)(2)(A)(iii) would also specify that data must be submitted with the QAP to demonstrate the accuracy of the analyzer at the maximum concentrations outside the proposed calibration range. Proposed new §115.725(d)(2)(A)(iv) would state that the executive director may specify calibration requirements in the approval of the QAP. Finally, proposed new §115.725(d)(2)(B) would specify that the owner or operator may install an on-line calorimeter to determine net heating value instead of monitoring for individual constituents to determine net heating value. It has come to the commission's attention that a reference in Performance Specification 9, Section 10.1 correctly cites Section 13.3 of Performance Specification 9 with regard to the acceptance criteria for multipoint calibration requirements. Section 13.3 would require industry to comply with a five-minute sampling frequency for the on-line analyzers. The correct citation for the precision and linearity requirements should be Section 13.2 of Performance Specification 9. The commission has confirmed the appropriate citation with the EPA. Therefore, it is the commission's position that industry should comply with the multipoint calibration requirements in Section 13.2 of Performance Specification 9.

The proposed amendment to §115.725(d)(3) would specify the calculation methodology for determining the percent measurement data availability. The proposed amendment to §115.725(d)(4) would change the start of daily sampling from within 24 hours to within ten hours of initial on-line analyzer malfunction, and would specify that the samples collected during periods of monitor downtime shall be used to demonstrate "continuous compliance with the requirements of §115.722(a) - (d) of this title." The proposed amendment to §115.725(d)(5) would delete the move the language specifying that compliance with the minimum net heating value requirements is based on block one-hour average to §115.722(d)(1). The language currently in §115.725(d)(7) would be renumbered to §115.725(d)(6) and revised to move language to §115.722(d)(2) specifying that compliance with the exit velocity requirements is based on a block one-hour average. Additionally, §115.725(d)(6) would be renumbered to §115.725(d)(7) and revised to specify that HRVOC emission rates shall be calculated from data gathered according to paragraphs (1) - (6), and to specify that the heating value requirement is based on net heating value. Finally, in order to better organize the monitoring and testing rules, §115.725(d)(8) regarding minor modifications to the methods and alternative monitoring methods, is proposed to be moved to a new §115.725(j) and the language revised to better specify the requirements.

Section 115.725(e) currently states that flares used solely for abatement of emissions from loading operations for transport vessels or temporary portable flares used solely for the abatement of emissions from scheduled maintenance or startup or shutdown activities are not required to comply with the monitoring requirement of §115.725(d) provided specific requirements are satisfied. The proposed amendment to §115.725(e) specifies that this subsection would only apply to flares used solely for abatement of HRVOC emissions, would apply to loading operations from marine vessels, and would not apply to temporary portable flares used solely for scheduled startup, shutdown, or maintenance activities. The proposed amendment to §115.725(e) would also move the recordkeeping requirements in §115.725(e)(1)(B) to §115.726(d)(5), and renumber §115.725(e)(1)(A) - (D) to §115.725(e)(1) - (3). The proposed amendment to §115.725(e)(1) - (3) would also specify the requirements to demonstrate compliance with the minimum net heating value requirements and the exit velocity requirements of §115.722(d), and compliance with the site-wide cap in §115.722. Proposed new §115.725(e)(4) would specify that the owner or operator may use process knowledge to determine net heating value and HRVOC emissions for flares that receive greater than 98% of an individual HRVOC at all times.

The proposed amendment would reletter §115.725(f) to §115.725(j) and specify that minor modifications to either test methods or monitoring methods may be approved by the executive director.

Proposed new §115.725(f) would specify monitoring requirements for flares used solely for abatement of emissions from scheduled startup, shutdown, and maintenance activities. Proposed new §115.725(f) would incorporate language removed from §115.725(e)(2), regarding temporary portable flares; however, but would also expand the applicability to any flare type used solely for scheduled startup, shutdown, and maintenance activities. Proposed new §115.725(f)(2) would limit the total number of days to 28 days in 12 consecutive months for which an account may temporarily send HRVOC to multiple flares under the provisions of §115.725(f). Proposed new §115.725(f)(6) would specify that the owner or operator may use process knowledge to determine net heating value and HRVOC emissions for flares that receive greater than 98% of an individual HRVOC at all times.

The proposed amendment to §115.725(g), regarding test waivers for one-half of the vents that are identical in design and operation, would move the language to §115.725(a)(8).

Proposed new §115.725(g) would specify monitoring requirements for emergency flares as proposed to be defined in §115.10. Proposed new §115.725(g)(1) and (2) would provide the option of complying with the monitoring requirements of §115.725(d) or using process knowledge and engineering calculations to determine compliance with §115.722(a) - (d). Proposed new §115.725(g)(2) would specify additional requirements for emergency flares for which process knowledge and engineering calculations are used. Proposed new §115.725(g)(2)(A) would specify parameter monitoring for emergency flares with physical seals, such as water seals, to monitor the status of the physical seals, record the time and duration of each event when emissions are sent to the flare, and verifies that the seals have been restored after an event. Proposed new §115.725(g)(2)(B) would specify parameter monitoring for emergency flares without physical seals to monitor flow to the emergency flare with a flow monitor or flow indicator to determine the time and duration of each event when emissions are sent to the flare and to determine the minimum flow rate that indicates when emissions are sent to the flare. Proposed new §115.725(g)(2)(C) would specify that any owner or operator electing to use process knowledge for emergency flares, must develop, implement, and follow a written monitoring plan for the parameter monitoring under §115.725(g)(2)(A) or (B). Proposed new §115.725(g)(2)(D) would specify that the written monitoring plans must be submitted within 30 days upon written request by the executive director. Proposed new §115.725(g)(2)(E) would specify the calculation methods for the actual exit velocity and the HRVOC hourly average mass emission rate from the flare, and the destruction efficiencies for various situations.

Proposed new §115.725(h) would specify requirements for flares other than emergency flares that temporarily receive HRVOC emissions from activities other than scheduled startup, shutdown, and maintenance. Proposed new §115.725(h)(1) and (2) would limit the total number of days that HRVOC may be temporarily sent to an individual flare, or to multiple flares at an account under the provisions of §115.725(h). Proposed new §115.725(h)(3) would options to determine flow rate to the flare in lieu of monitoring in accordance with §115.725(d)(2), including process knowledge, actual measurement, or for flares that temporarily receive HRVOC emissions from flare systems that are monitored according to §115.725(d), data substitution. Proposed new §115.725(h)(4) would specify options to determine net heating value and HRVOC constituents in lieu of monitoring in accordance with §115.725(d)(2), including daily sampling according to §115.725(d)(4) or, for flares that temporarily receive HRVOC emissions from flare systems that are monitored according §115.725(d), data substitution for time periods up to 72 consecutive hours. Finally, proposed new §115.725(h)(5) would specify that, if an emissions event occurs while HRVOC emissions are sent temporarily to a flare under §115.725(h), then process knowledge may be used to determine compliance with §115.722(a) - (d).

Proposed new §115.725(i) would specify that process knowledge may be used to determine compliance with §115.722(a) - (d) for flares that are specifically designed to receive and control liquid or dual phase streams. This amendment is necessary because the monitoring provisions in the §115.725 are not applicable to flares designed to control liquid streams, and the current state of monitoring technology is not sufficient to allow continuous monitoring of dual phase streams.

Proposed new §115.725(j) (that was relettered from §115.725(f)) would incorporate language previously in §115.725(f) to specify that minor modifications to either test methods or monitoring methods may be approved the executive director.

Finally, proposed new §115.725(k) would specify that when process information and engineering calculations are used to demonstrate compliance with §115.722(a) - (d), the process information and engineering calculations must be submitted within 30 days upon written request by the executive director. This addition to §115.725 is necessary to ensure the commission has adequate information to determine compliance with the site-wide caps.

Section 115.726, Recordkeeping and Reporting Requirements

The proposed amendment to §115.726(a) would remove the unnecessary language specifying review of test plans and QAPs, and would specify that the owner or operator of each affected flare or vent gas stream subject must subsequently comply with the approved testing plans and QAPs for monitoring. The proposed amendment to §115.726(a)(1) would specify that the paragraph applies to the monitoring requirements in §115.725(d) and the proposed amendment to §115.726(a)(1)(A) would specify the latest date that the QAP must be submitted. The proposed amendment to §115.726(a)(1)(B) would change the requirement to submit QAP for flares that become subject to the requirements of the division after the compliance date. The proposed amendment to §115.726(a)(1)(B) would change the requirement to submit the QAP at least 60 days prior to the flare being place in HRVOC service by removing the 60-day time period and only require that the QAP be submitted prior to the flare being placed in HRVOC service. The proposed amendment to §115.726(a)(2) would specify that the paragraph only applies to the testing requirements in §115.725(a). Additionally, proposed new §115.726(a)(2)(D) would specify that the operation parameters required in proposed new provisions in §115.725(a)(1) and (2) must be identified in the test plan.

The proposed amendment to §115.726(b) would include more specific recordkeeping requirements of the vent testing and monitoring conducted as required by §115.725(a) and (b). Proposed new §115.726(b)(1) - (3) would include the addition of recordkeeping requirements for the process parameter monitoring and monitoring plans required under proposed new §115.725(a)(1), (2), and (4). Additionally, proposed new §115.726(b)(4) - (7) would provide more specific recordkeeping requirements for vent gas streams monitored using a continuous emission monitoring systems in accordance with §115.725(b)(1), and for vent gas streams for which alternatives to testing have been allowed under §115.726(b)(2).

The proposed amendment would reletter §115.726(c), relating to recordkeeping requirements for flares monitored in accordance with §115.725, to §115.726(d). Proposed new §115.726(c) would include recordkeeping requirements for affected pressure relief valves monitored in accordance with the proposed new provisions in §115.725(c). The proposed additional recordkeeping requirements would include records of the date, time, duration, volumetric flow rate, and speciated and total HRVOC emissions for each pressure relief event. The proposed recordkeeping requirements for affected pressure relief valves would include records of the parameters monitored in accordance with §115.725(c)(1), all process information, data, and calculations used to determine flow and emission data as specified in §115.725(c)(2), and the monitoring plans required under §115.725(c)(3).

The proposed amendment to §115.726(d) (that was relettered from §115.726(c)) would specify that the recordkeeping requirements are for flares monitored in accordance with §115.725. The proposed amendment to §115.726(d)(4) (that was renumbered from §115.726(c)(4)) would specify that the records maintained for the calculated net heating values and exit velocities must be recorded on a 15-minute average basis rather than instantaneous values.

Proposed new §115.726(d)(5) would specify recordkeeping requirements specific to flares used solely for loading operations under §115.725(e), in addition to the general flare recordkeeping requirements in §115.726(d)(1) - (4). The proposed new language in §115.726(d)(5) would incorporate recordkeeping requirements moved from §115.725(e)(1)(B) and the requirement in §115.726(d)(5)(A) would require the size of vessel being loading instead of the type of vessel.

Proposed new §115.726(d)(6) would specify recordkeeping requirements specific to flares used solely for scheduled startup, shutdown, and maintenance activities under §115.725(f), in addition to the general flare recordkeeping requirements in §115.726(d)(1) - (4). Similarly, proposed new §115.726(d)(7) would specify recordkeeping requirements specific to emergency flares subject to §115.725(g), in addition to the general flare recordkeeping requirements in §115.726(d)(1) - (4). Finally, proposed new §115.726(d)(8) would specify recordkeeping requirements specific to flares subject to the requirements of §115.725(h) or (i), in addition to the general flare recordkeeping requirements in §115.726(d)(1) - (4).

The proposed amendment would reletter §115.726(d), related to records for exemptions to §115.726(e), and would specify that the records correspond to the exemptions listed in §115.727(a) - (e). The proposed amendment to §115.726(e)(1) (that was renumbered from §115.726(d)(1)) would specify that the records applied to vent gas streams that are routed to flares and that contain less than 5.0% by weight HRVOC, and to vent gas streams that are not routed to flares that does not exceed 100 parts per million by volume HRVOC. The proposed amendment to §115.726(e)(3) would correct cross-references.

The proposed amendment would reletter §115.726(f) to §115.726(i) and add a new §115.726(f) that would specify that an owner or operator claiming exemption under §115.727(e) must submit written notification at least 15 days prior to permanently removing a flare from service, but no later than December 31, 2005.

The proposed amendment would reletter §115.726(e) to §115.726(g). The proposed amendment to §115.726(g) would specify that daily records are required to demonstrate compliance with the tons per calendar year emissions limits in §115.722(a) and (b). Furthermore, the proposed amendment to §115.726(g)(2) would include pressure relief valves in addition to all flares and vents subject to §115.725. Finally, the proposed amendment would delete §115.726(g)(3) because this specific recordkeeping requirement would be moved to §115.726(g)(2).

Proposed new §115.726(h) would specify the recordkeeping requirements to demonstrate compliance with the one-hour block emission limits in §115.722(c).

The proposed amendment to §115.726(i) (relettered from §115.726(f)) would specify that records must be maintained on-site.

Section 115.727, Exemptions

The proposed amendment to §115.727(b)(1) and (2) would correct cross-references. Additionally, the proposed amendment to §115.727 would delete §115.727(c) that specified that emissions from scheduled maintenance, startup, and shutdown activities in compliance with 30 TAC §101.211 are exempt from the requirements of §115.722(a), and §115.727(d) that specifies that emissions from emissions events in compliance with §101.201 are exempt from the requirements of §115.722(a). The proposal to remove the exemptions in §115.727(c) and (d) is necessary to better ensure an approvable SIP and the demonstration of attainment.

The proposed amendment would reletter §115.727(e) to §115.727(c) and include the addition of language to specify that the exemptions in §115.727(c) may apply to vent gas streams that are not routed to a flare. The proposed amendment to §115.727(c)(1) - (3) would correct cross-references. The proposed amendment to §115.727(c)(2) would also add language to provide exemption for vent gas streams with low volumetric rates equal to or less than 100 dry standard cubic feet per hour. This proposed revision provides flexibility for exempting vent gas streams that may exceed the 100 parts per million by volume exemption level already provided, but have minimal HRVOC emissions due to very low volumetric flow rate. An additional proposed amendment to §115.727(c)(2) would specify that the 5.0% limit for the total number of vents claimed exempt under §115.727(c)(2) is based on the long-term pound per hour cap limitation in §115.722(a) or (b). Finally, the proposed amendment to §115.727(c)(3)(A) would add incinerators to list of the sources for which an exemption may be claimed and would specify that the exemption for vent gas streams resulting from the combustion of less than 5.0% HRVOC is "by weight."

The proposed amendment would reletter §115.727(f) to §115.727(d) and correct a cross-reference.

Proposed new §115.727(e) would specify that any flares that will be permanently out of service by April 1, 2006 are exempt from the requirements of the division except for the recordkeeping requirements of §115.726(f). The new proposed exemption will provide relief for owner or operators with flares that will be permanently taken out of service after the December 31, 2005 compliance date to install continuous monitoring equipment, but prior to the April 1, 2006 compliance date for the site-wide caps in §115.722.

Section 115.729, Counties and Compliance Schedules

The proposed amendment to §115.729(1) would add pressure relief valves as applicable devices. Additionally, the proposed amendment to §115.729(1)(A) would specify that the compliance schedule applies to testing and monitoring of vent gas streams and pressure relief valves and that the results must be submitted to the Houston regional office. The proposed amendment to §115.729(1)(A) would also specify that for vent gas streams and pressure relief valves that become subject to the requirements of the division after December 31, 2005, testing and monitoring must be conducted as soon as practicable, but no later than 60 days after being brought into HRVOC service. The proposed amendment to §115.729(1)(B) would specify that the owner or operator shall demonstrate compliance with all other requirements of the division applicable to pressure relief valves in addition to vent gas streams as soon as practicable but no later than April 1, 2006.

The proposed amendment to §115.729(2) would correct a cross-reference, and would specify that for flares that become subject to the requirements of the division after December 31, 2005, testing and monitoring must be conducted as soon as practicable but no later than 60 days after being brought into HRVOC service.

Division 2, Cooling Towers

Section 115.760, Applicability and Cooling Tower Heat Exchanger System Definitions

The proposed amendment to §115.760 would include non-substantive language changes to §115.760(a) and (b).

Section 115.761, Site-wide Cap

The commission proposes to amend this section to allow sites the flexibility of compliance with the cooling tower heat exchange system control requirements of this division through compliance with the HRVOC emissions cap and trade program. The proposed amendment to §115.761(a) would change the long-term site-wide cap strategy to a calendar year basis instead of the existing 24-hour rolling average basis, and would state that owners or operators of a site subject to the HRVOC cooling tower heat exchange system rules shall comply with the HRVOC emissions cap and trade program in Chapter 101, Subchapter H, Division 6. The proposed amendment to §115.761(a) would also remove the reference to the site-cap limits in the tables of the SIP. The proposed amendment would reletter §115.761(b) to §115.761(d). Proposed new §115.761(b) would specify that all sites subject to this division or to Division 1 that are exempt from the HRVOC emissions cap and trade program in accordance with §101.392 are limited to ten tons of HRVOC emissions per calendar year. Proposed new §115.761(c) would provide a short-term, not-to-exceed limit, in pounds of HRVOC per one-hour block, for all sites subject to this division. The commission continues to evaluate the magnitude of the short-term limit, and the time period over which this short-term limit would be enforced. The commission solicits comment regarding the appropriate level for this short-term limit, and requests any supporting data regarding alternatives to the magnitude and time period. Proposed new §115.761(c)(3) would address how exceedances of the short-term limits should be calculated to determine compliance with the long-term cap.

Section 115.764, Monitoring and Testing Requirements

The proposed amendment to §115.764 would change the section title from "Monitoring Requirements" to "Monitoring and Testing Requirements" to reflect the proposed inclusion of the testing requirements formerly in §115.766. Merging the testing requirements of §115.766 with the monitoring requirements of §115.764 would provide more consistency with the rule structure of Subchapter H, Division 1.

The proposed amendment to §115.764(a) would remove the de minimus exemption for 100 parts per million, by weight (ppmw) of HRVOC in the process side fluid. The 100 ppmw de minimus exemption language is proposed to be incorporated into the appropriate exemptions in §115.767, Exemptions, formerly §115.768, to better facilitate interpretation of the rule.

The proposed amendment to §115.764(a)(2) would include the calibration requirements of the total strippable VOC monitoring system from §115.766(1). The proposed revisions to calibration requirements of the total strippable VOC monitor in §115.764(a)(2) would include changing the allowable monitor drift from 3.0% to 5.0%. Furthermore, the proposed amendment would remove the ten parts per billion, by weight detection limit requirement for the total strippable VOC monitor. Finally, the proposed amendment to §115.764(a)(2) would correct the citation to the air-stripping method in Appendix P.

The proposed amendment to §115.764(a)(3) would specify the calculation methodology to determine the percent measurement data availability, would provide consistency for the calculation of monitor uptime, and would specify that time needed for normal calibrations required by the rule is not counted as downtime. The proposed amendment to §115.764(a)(4) and (5) would replace the references to §115.766 with the specific reference to the air-stripping method in Appendix P.

The proposed amendment to §115.764(a)(6) would replace the reference to "speciation of strippable VOC in paragraphs (4) and (5)" with "speciation of strippable HRVOC in paragraphs (4) and (5)" because the requirements of §115.764(a)(4) and (5) are for the speciation of HRVOC only. Additionally, the proposed amendment would remove the requirement to comply with Section 8.2 of EPA Performance Specification 9. While the initial testing required under Section 8.2 of Performance Specification 9 is recommended to help establish proper setup and operation of the analyzer, the commission considers the calibration requirements specified in the proposed amendment to §115.764(a)(6) sufficient to quality assure the data generated by the analyzer, and that it is unnecessary to specifically require Section 8.2 in the rule. Furthermore, the proposed amendment to §115.764(a)(6) would change the frequency of the multipoint calibration check procedure in Section 10.1 of Performance Specification 9 from monthly to quarterly, because quarterly multipoint calibrations checks provide sufficient quality assurance of analyzer linearity and accuracy. The proposed amendment to §115.764(a)(6) would also include non-substantive language revisions to better facilitate interpretation of the monitoring requirements. Finally, the proposed amendment to §115.764(a)(6) would specify that periodic sampling during downtime of the continuous on-line analyzer will continue until the on-line analyzer is properly operating and within the required performance specifications.

The proposed amendment to §115.764(b) would remove the de minimus exemption for 100 ppmw of HRVOC in the process side fluid. The 100 ppmw de minimus exemption language is proposed to be incorporated into the appropriate exemptions provided in §115.767, formerly §115.768, to better facilitate interpretation of the rule. The proposed amendment to §115.764(b)(2) would replace the reference to §115.766 with the specific reference to the air-stripping method in Appendix P.

The proposed amendment to §115.764(b)(3) would add language specifying the calculation methodology for determining the percent measurement data availability to provide consistency for the calculation of monitor uptime and specify that the time required for normal calibrations as required by the rule is not counted as downtime. The proposed amendment to §115.764(b)(4) and (5) would replace references to §115.766 specific references to the air-stripping method in Appendix P. The proposed amendment to §115.764(b)(5) would specify that additional sampling to determine total strippable VOC, speciated and total HRVOC must continue on a daily basis until the concentration of total strippable VOC drops below 50 ppbw.

The proposed amendment to §115.764(b)(6) would remove the reference to "speciation of strippable VOC" and replace with "speciation of strippable HRVOC" because the requirements of §115.764(b)(4) and (5) are for speciation of HRVOC only. Additionally, the proposed amendment would remove the requirement to comply with Section 8.2 of EPA Performance Specification 9. While the initial testing required under Section 8.2 of Performance Specification 9 is recommended to help established proper setup and operation of the analyzer, the commission considers the calibration requirements specified in the proposed revision to §115.764(b)(6) sufficient to quality assure the data generated by the analyzer. Furthermore, the proposed revisions to §115.764(b)(6) would change the frequency of the multipoint calibration check procedure in Section 10.1 of Performance Specification 9 from monthly to quarterly, because quarterly multipoint calibrations checks will provide sufficient quality assurance of analyzer linearity and accuracy. An additional proposed amendment to §115.764(b)(6) would include non-substantive language revisions to better facilitate interpretation of the monitoring requirements. Finally, the proposed revisions to §115.764(b)(6) would specify that periodic sampling during downtime of the continuous on-line analyzer will continue until the on-line analyzer is properly operating and within the required performance specifications.

The proposed amendment to §115.764(c) would incorporate language from the testing requirements in §115.766 that are proposed for repeal. The proposed amendment would remove the ten ppbw minimum detection limit requirement for strippable VOC and HRVOC monitoring that currently exists in §115.766(1). Removing the requirement would provide more flexibility for affected owners or operators in the selection of on-line monitoring systems and laboratories for analysis of periodic samples. However, the requirements in proposed new §115.766(a)(3) and (4) to use one-half the detection limit for HRVOC emission calculation purposes and the full detection limit for total strippable VOC concentrations will encourage owners or operators to use a monitoring system or laboratory analysis with sufficient detection capability appropriate for the specific cooling tower size and the amount of site-wide caps for the account.

The proposed amendment would delete §115.764(d), regarding requirements to submit QAPs for the monitoring systems required by §115.764, and move the requirements for the QAPs to proposed new §115.766(i) in the recordkeeping and reporting requirements. Also, the proposed amendment would reletter §115.764(e) to §115.764(d) and replace the reference to the testing requirements of §115.766 with the reference to the air-stripping method in Appendix P.

The proposed amendment would reletter §115.764(f), relating to alternatives to continuous flow monitoring, to §115.764(e), and would correct cross-references to account for other proposed amendments to the division.

The proposed amendment would reletter §115.764(g), relating to minor modifications and alternative monitoring, to §115.764(f), would correct cross-references, and would specify that the provisions for modifications or alternatives apply to testing as well as monitoring.

Proposed new §115.764(g) would specify that alternative monitoring locations may be used for cooling tower heat exchanger systems in which a single cooling tower services both HRVOC and non-HRVOC process units. The proposed new provisions would allow the owner or operator to monitor from locations that represent the flow and concentrations from HRVOC processes.

Proposed Repeal of Section 115.766, Testing Requirements

The commission proposes to repeal §115.766 and to incorporate specific testing requirements of §115.766 into the appropriate subsections in §115.764 to establish more consistency with Division 2 and to better facilitate interpretation of the proposed requirements.

Proposed Repeal of Section 115.767, Recordkeeping Requirements

The commission proposes to repeal §115.767 and to incorporate specific recordkeeping requirements of §115.767 into proposed new §115.766, Recordkeeping and Reporting Requirements, to establish more consistency with Division 1.

Section 115.766, Recordkeeping and Reporting Requirement

Proposed new §115.766 incorporates the recordkeeping and reporting requirements of §115.767 to establish more consistency with Division 1 and more accurately reflect the requirement of the §115.766. Proposed new §115.766(a)(2) would correct cross-references in existing §115.767(a)(2).

Proposed new §115.766(a)(3) would remove the requirement to maintain hourly records documenting the pound per hour mass emission rate for total strippable VOC in existing §115.767(a)(3). The testing and monitoring requirements in §115.764 for total strippable volatile organic compound, when applicable, do not require determining the mass emission rate of total strippable VOC. The recordkeeping requirements for total strippable VOC concentration are addressed in proposed new §115.766(a)(4). Proposed new §115.766(a)(3) would also correct cross-references and incorporate recordkeeping requirements for alternative monitoring provided for in §115.764(a)(6) or (b)(6). Proposed new §115.766(a)(3) would require owners or operators to use one-half the minimum detection limits for HRVOC emission calculations when concentrations are below detection.

Proposed new §115.766(a)(4) would require owner or operators to use the full minimum detection limit for total strippable VOC when concentrations are below detection. Removing the ten parts per billion detection limit requirement would provide more flexibility for affected owner or operators in the selection of on-line monitoring systems and laboratories for analysis of periodic samples. However, the requirements to use one-half the detection limit for HRVOC emission calculation purposes and the full detection limit for total strippable VOC concentrations will encourage owner or operators to use a monitoring system or laboratory analysis with sufficient detection capability appropriate for the specific size of cooling tower and the amount of the side-wide caps for the account.

Proposed new §115.766(a)(4) would specify recordkeeping requirements for the concentration of total strippable VOC in the cooling water for cooling tower heat exchanger systems monitored in accordance with §115.764(b)(2) or (d). Proposed new §115.766(a)(4) would further specify that if it concentration results for total strippable VOC are below the minimum detection limit, then the full detection limit will be used to calculate the average total strippable VOC concentration in the cooling water.

The proposed amendment to §115.766 would delete the requirements in existing §115.767(a)(5) regarding hourly recordkeeping requirements for the 24-hour rolling average HRVOC emissions in relation to the site wide cap. Provisions for recordkeeping to demonstrate compliance with the site-wide caps specified in §115.761 are provided in proposed new §115.766(g) and (h). The proposed amendment also deletes the requirements in existing §115.766(a)(6) regarding recordkeeping requirements for alternative monitoring performed in accordance with §115.764(a)(6) or (b)(6). As previously noted, new §115.766(a)(3) is proposed to incorporate these recordkeeping requirements.

Proposed new §115.766(a)(5) specifies that the owner or operator must maintain hourly records of the cooling water flow rate. Finally, proposed new §115.766(a)(6) would remove the term "hourly" from the existing language of §115.767(a)(4) to specify that owner or operators must maintain records on a weekly basis.

The proposed amendment to §115.766 includes revisions to §115.766(b) to correct cross-references in the existing language of §115.767(b). The proposed language in new §115.767(c) is the same as the language in existing §115.767(c). Proposed new §115.766(d) includes existing language from §115.767(d)(1) and (2) to reflect proposed new §115.766(a) incorporating the recordkeeping requirements for testing performed in accordance with §115.764(d) and to better facilitate interpretation of the recordkeeping requirements.

Proposed new §115.766(e) and (f) would correct cross-references in existing §116.767(e) and (f).

Proposed new §115.766(g) and (h) would specify recordkeeping requirements to demonstrate compliance with §115.761. Proposed new §115.766(g) would specify recordkeeping requirements to demonstrate compliance with tons per calendar year emission limits in §115.761(a) and (b). Proposed new §115.766(h) would recordkeeping requirements to demonstrate compliance with pound per hour emission limits in §115.761(c).

Finally, proposed new §115.766(i) would incorporate the requirements for submitting QAPs for monitoring performed in accordance with §115.764. The requirements for submitting QAPs is proposed to be moved from §115.764(d) to the recordkeeping and reporting requirements in §115.766 to more appropriately represent the requirement and to be more consistent with the rule structure of Division 1. In addition, proposed new §115.766(i)(2) would change the requirement to submit the QAP at least 60 days prior to the cooling tower heat exchange system being placed into service to a requirement that the quality assurance plan must be submitted prior to the system being placed into HRVOC service. The proposed amendment would also remove the requirement in existing §115.764(d)(2) that specifies that the plan must be submitted prior to initiating a monitoring program to comply with the requirements of §115.764. The proposed amendment to move the quality assurance plan provisions to §115.766(i) would also remove the requirement in §115.764(d)(2) to define each compound that could potentially leak through the heat exchanger. Finally, proposed new §115.766(j) would specify that an owner or operator claiming exemption under §115.767(4) shall submit written notification at least 15 days prior to permanently removing a flare from service, but no later than December 31, 2005.

Section 115.767, Exemptions

The commission proposes to repeal §115.768 and to incorporate exemptions of §115.768 into the appropriate subsections in proposed new §115.767 to be consistent with the section numbering in Division 1. Proposed new §115.767(1) and (2) would specify that the exemptions apply to heat exchangers with greater than 100 ppmw HRVOC in the process side fluid. Also, the commission proposes to delete the exemption in existing §115.768(4), because emissions events are not exempt from §115.761 in this proposal. Proposed new §115.767(4) would specify that cooling tower heat exchange systems that will be permanently out of service by April 1, 2006, are exempt from the requirements of the division, except for the recordkeeping requirements of §115.766(j). The proposed new exemption will provide relief for owners or operators with cooling tower heat exchange systems that will be permanently taken out of service after the December 31, 2005 compliance date for installation of continuous monitoring equipment, but prior to the April 1, 2006 compliance date for the site-wide caps in §115.761.

Section 115.769, Counties and Compliance Schedules

The proposed amendment to §115.769 would update cross-references and add new §115.769(b) to address the compliance date requirements for cooling tower heat exchange systems that become subject to the requirements of the division after December 31, 2005.

Division 3, Fugitive Emissions

Section 115.780, Applicability

The proposed amendment to §115.780 would designate the first paragraph as subsection (a) and would add new §115.780(b) to specify that emission reduction credits or discrete emission reduction credits may not used in order to demonstrate compliance with the HRVOC fugitive emissions rules.

Section 115.781, General Monitoring and Inspection Requirements

The proposed amendment to §115.781(b)(1) would update a cross-reference to specify that the exemptions of §115.357(1) - (11) are not applicable to this division. The term "immediately" is proposed to be added to §115.781(b)(7)(A), to specify that if requested by staff of the Houston regional office or any air pollution control agency having jurisdiction, the owner or operator must provide the account's unsafe-to-monitor list within that business day. The proposed amendment to §115.781(b)(7)(B) would specify that difficult-to-monitor components include components that are located below flooring or deck grating that would require confined space entry as defined in 29 CFR §1910.146, concerning Permit-required confined spaces (December 1, 1998).

The proposed amendment to §115.781(b)(8) and (e) would specify that all pressure relief valves in gaseous service must be monitored with a hydrocarbon gas analyzer for fugitive leaks. The intent of the change is to specify that the body of the pressure relief valve should be monitored for fugitives on a quarterly basis and within 24 hours following actuation, and not to require the monitoring of the vent from the pressure relief valve. The emissions associated with the venting of the pressure relief valve due to a pressure exceedance in the process is addressed in the Subchapter H, Division 1 proposal. However, the quarterly monitoring or other required fugitive monitoring should include a check with a hydrocarbon gas analyzer to ensure that the relief mechanism has properly reseated.

Proposed new §115.781(g) would add language regarding data collection that is similar to data collection language in Subchapter D, §115.354(10). The language is proposed to be removed from §115.354(10) in concurrent rulemaking. These changes are being proposed at the request of industry. The commission seeks comment on these proposed changes.

Section 115.782, Procedures and Schedule for Leak Repair and Follow-up

The proposed amendment to §115.782(c) would specify that components on the delay of repair list that would require a shutdown to correct, must be repaired at the next scheduled process unit shutdown. The proposed amendment to §115.782(c)(1)(B)(i) would replace the current language with language requiring documentation of calculations in §115.782(c)(1)(B)(i) - (iii), and would renumber clause (ii) as clause (iv). The proposed language in §115.782(c)(1)(B)(i) - (iii) is similar to language that is proposed to be removed from Subchapter D, §115.352(2)(A)(i) - (iii), in concurrent rulemaking, and the proposed amendment is at the request of industry. The commission seeks comment on these proposed changes.

The proposed amendment to §115.782(c)(2)(A)(i) would specify that extraordinary efforts must be taken within 14 or 30 calendar days after the leak is found (depending on the amount of the leak detected), instead of seven or 15 days of the valve being placed on the shutdown list. The proposed amendment does not allow any additional days nor reduce the number of days, but simply revises the language to a time frame that the owner or operator will more readily know from the information already in the databases.

Section 115.783, Equipment Standards

The proposed amendment to §115.783(2) would delete the language that recovery devices, flares, and other control devices that are used to control fugitive emissions must obtain a set control efficiency. This language is proposed to be deleted because the emissions from these types of sources are already being controlled or are proposed to be controlled by Subchapter B, Division 2 rules or by Subchapter H, Division 1 rules. The proposed amendment to §115.783(3) would delete the requirement that a pressure relief valve must be equipped with a pressure sensing device. This language is proposed to be deleted because the emissions from these types of sources would be controlled by Subchapter H, Division 1. The proposed amendment to §115.783 would renumber paragraphs (4) - (6) as paragraphs (3) - (5).

Proposed Repeal of §115.785, Testing Requirements

The commission proposes to repeal §115.785 because the section established a stack testing method for sources that control fugitive emissions. These sources are controlled or proposed to be controlled under Subchapter H, Division 1; therefore, these additional requirements are no longer necessary in the fugitive rules.

Section 115.786, Recordkeeping Requirements

The proposed amendment to §115.786(b)(3)(D) would specify that the flow through the bypass line is an estimated flow rate. The proposed amendment to §115.786(c) would specify the exact date that specific records must be submitted to the Houston regional office and any local air pollution control agency having jurisdiction.

The proposed amendment to §115.786(d) and (e) would specify that the type of records used to identify exempt components is the same as the type of records listed in §115.781. Proposed new §115.786(d)(1) and (2) would add similar language that is proposed to be removed from Subchapter D, §115.352(2)(F)(ix) and §115.356(3) in concurrent rulemaking. The proposed amendment to §115.786 would also reletter subsection (e) to subsection (f). The commission seeks comment on these proposed changes.

Section 115.787, Exemptions

The proposed amendment to §115.787(a) would correct a citation from §115.786(d) and (e) to §115.786(e) and (f), and the proposed amendment to §115.787(b) would correct a citation from §115.783(4) to §115.783(2).

The proposed amendment to §115.787(c)(4) would change the language "plant sites covered by a single account number" to "any account." The proposed amendment to §115.787(c)(6) and (7) would replace the phrase "which are in compliance with" with the phrase "that meet the requirements of" because the current language may be incorrectly interpreted as requiring direct compliance with the selected provisions of 40 CFR §63.166 or §63.169.

The commission proposes to delete §115.787(e), because the control of vents of pressure relief valves is being proposed in the amendments to Subchapter H, Division 1 and is no longer needed in this division. The proposed amendment to §115.787 would also reletter subsection (f) to subsection (e).

Proposed new §115.787(f) would reletter the subsection to §115.787(e), and correct a citation from §115.352(4) to §115.783(5).

Proposed new §115.787(f) would exempt any process unit with less than 50 components in HRVOC service from the third-party audit requirements of §115.788.

Section 115.788, Audit Provisions

The proposed amendment to §115.788(a) would change the time frame and number of process units for which the independent third-party audits must be conducted. The proposed amendment would change the requirement to conduct an audit of all process units every two years to a requirement to conduct an audit of at least one process unit at least once per calendar year. In addition, the amendment would require that all process units at an account must be audited at least once every five calendar years. Accounts with less than five process units but more than one process unit, should not audit the same unit two years in a row.

The proposed amendment to §115.788(a)(1) would require the independent third-party organization to verify that all components are properly tagged in accordance with §115.782(a). The proposed amendment to §115.788(a)(1)(B) and (d)(2) would remove the requirement for the audit to include a list of components that should have been monitored but were not on the list to be monitored. The reasoning for the proposed amendment is that the existing language would require the company conducting the audit to completely inspect the entire process unit, including, but not limited to, steam lines, water lines, and waste lines. The commission considers this requirement to be cost prohibitive for the results that would be obtained.

The proposed amendment to §115.788(a)(2) would state that independent third-party organization must perform a field survey to determine the representative percentage of leaking components in the audited process unit. The proposed amendment to §115.788(a)(2)(A) would also specify that the field survey must be started after the usual monitoring service has completed its monitoring of the process unit and that the field survey conducted by the auditing company must be completed by the end of the monitoring period (i.e., quarterly) in which the usual monitoring service conducted its monitoring. The proposed amendment to §115.788(a)(2)(B) would remove superfluous language.

The proposed amendment to §115.788(a)(2)(C) would replace the term, "audit" with the term, "field survey" and further specify that the field survey of a specific process unit must not include components from the most recent field survey of that process unit. Proposed new §115.788(a)(2)(D) specifies that the independent third-party organization must follow Test Method 21 in 40 CFR Part 60, Appendix A, while conducting the field survey.

The proposed amendment to §115.788(a)(3) would specify that the data generated by monitoring technicians must be reviewed by the independent third-party organization. The proposed amendment to §115.788 would also consolidate the language in §115.788(a)(3)(A) and(B), and would move the language in §115.788(d)(4) to §115.788(a)(3)(A). The proposed amendment to §115.788(a)(3)(B) would require that the independent third-party organization review the records to verify proper calibration in accordance with Test Method 21. The proposed amendment to §115.788(a)(3)(C) would delete the term, "abnormal" and specify that the requirement is to identify data patterns indicative of failure to properly implement Test Method 21. The proposed amendment would delete §115.788(a)(3)(D) because the retention of field data from a datalogger is not specifically required.

The proposed amendment to §115.788(b) would make a grammatical correction to remove the term "means" and replace it with the term "is."

The proposed amendment to §115.788(c) would remove the requirement to provide the agency written notification that the audit has been completed. The requirement is unnecessary, because the owner or operator is already required to provide the results of the audit to the Houston regional office within 30 days after completion of the audit.

The proposed amendment to §115.788(d) would specify that the audit report should be submitted to the Houston regional office, instead of the more general description of the Office of Compliance and Enforcement or appropriate regional office. The proposed amendment to §115.788(d)(1) would specify that the list concerning the components that were not tagged but should have been, is based on the requirements of §115.782(a).

The proposed amendment to §115.788(d) would renumber paragraphs (3) and (4) to paragraphs (2) and (3), and the proposed amendment to renumbered §115.788(d)(2) would specify that the percentage of leaking components should be identified during the field survey.

The proposed amendment to renumbered §115.788(d)(3) would delete subparagraphs (A) - (C) and reference the categories specified in §115.788(a)(3)(A) - (C).

Proposed new §115.788(e) would require the owner or operator to submit a corrective action plan with the audit report if the results of the audit indicate deficiencies in the implementation of Test Method 21. Subsections (e) and (f) are also proposed to be relettered as subsections (f) and (g).

Finally, proposed new §115.788(h) would specify that the executive director may require additional corrective actions.

Section 115.789, Counties and Compliance Schedules

The proposed amendment to §115.789(3) would specify that the initial third-party audits required in §115.788 must be completed as soon as practicable, but no later than December 31, 2005. The proposed deletion of the current §115.789(4) would remove the compliance schedules for testing requirements, because the corresponding testing requirements in §115.785 are proposed to be repealed. The proposed amendment to §115.789 would renumber paragraphs (5) and (6) to paragraphs (4) and (5).

FISCAL NOTE: COSTS TO STATE AND LOCAL GOVERNMENT

Nina Chamness, Analyst, Strategic Planning and Appropriations Section, determined that for the first five-year period the proposed rulemaking is in effect, there will not be significant fiscal implications for the agency or other units of state and local government as a result of administration or enforcement of the proposed rulemaking.

The proposed rulemaking affects regulated entities in the HGA that conduct activities that emit HRVOC. State and local governments do not engage in these activities, so they are not affected by the proposed rulemaking.

The proposed rulemaking only affects the petrochemical, chemical, loading, and refinery companies in the HGA. The major impacts of the proposed rulemaking are as follows: 1) caps on HRVOC allowances are lowered, thereby requiring some companies to emit less HRVOC; 2) adds parameter monitoring requirements for pressure relief valves and vent gas streams not routed to a flare. Companies can decide which process parameters to monitor as long as the process parameters satisfy the proposed requirements; 3) includes alternative provisions for specific flare categories such as emergency flares, flares in temporary HRVOC service, and flares designed to receive and control liquid or dual phase streams. These provisions will reduce current monitoring costs; and 4) for companies with greater than two process units, reduces the number of independent, third-party audits of processes in HRVOC service that generate fugitive emissions.

PUBLIC BENEFITS AND COSTS

Ms. Chamness also determined that for each year of the first five years the proposed rulemaking is in effect, the public benefit anticipated from the changes seen in the proposed rulemaking will be the reduction of HRVOC emissions in the HGA. This will allow Texas to comply with the SIP required by 42 USC and reduce the ozone levels in this nonattainment area to levels determined by the EPA to be necessary for a healthy and safe environment.

The commission anticipates fiscal impacts for businesses and individuals in the petrochemical, chemical, loading, and refining industries in the HGA; however, the commission anticipates that the changes in monitoring requirements would not result in significant fiscal implications. Provisions that reduce the HRVOC emissions for compliance with the site-wide cap in Harris County may have significant fiscal implications for these industries, depending upon the methodology used to reduce the HRVOC emissions.

Revised Monitoring Requirements

The proposed rulemaking reduces the requirements for independent, third-party audits of each process that generates fugitive emissions. The commission conservatively estimates that the current audit provision would require affected industries to pay for 400 to 500 audits every two years at a cost of approximately $5,000 - $10,000 per audit. The proposed rulemaking would require independent, third-party audits of a minimum of one process unit per year per account. Depending on the size of the account, the proposed rulemaking could present a significant cost savings to some accounts. For example, under the current rules an account with 40 process units would be required to perform all 40 audits within two years. The proposed rulemaking would require the 40 audits to be performed within a five-year period. The commission estimates that these audits would cost approximately $200,000 - $400,000 over a two-year period. In this example, the cost savings attributed to the proposed rulemaking would be approximately $120,000 - $240,000 during the two-year period. The commission anticipates that the cost savings from reducing the audit provisions would help mitigate any costs associated with additional monitoring that the proposed rulemaking would require.

The proposed rulemaking adds parameter monitoring requirements for pressure relief valves and vent gas streams that are not routed to a flare. The proposed rulemaking provides flexibility on the process parameters that can be monitored as long as the process parameters satisfy the proposed requirements. Thus, companies have some control over the cost of the new monitoring requirements. The commission anticipates that in some cases, parameters that meet the proposed requirements may already be monitored. If a suitable parameter is already being monitored, but is not currently being recorded, companies may be able to make minor modifications to existing process monitoring to comply with the proposed monitoring requirements. Therefore, significant additional monitoring costs should not be incurred.

The proposed rulemaking adds alternatives to the continuous monitoring requirements for specific flare categories, such as emergency flares, flares in temporary HRVOC service, and flares designed to receive and control liquid or dual-phase streams. Under current rules, these flares are subject to the full continuous monitoring requirements including continuously measuring HRVOC. However, for these flare categories, such monitoring may be impractical due to the infrequent use or the nature of the streams sent to the flare. The proposed rulemaking would allow companies to use alternatives, such as process knowledge and engineering calculations, or process knowledge and engineering calculations combined with process parameter monitoring. These proposed alternatives will result in cost savings for owners or operators of the flare categories.

Emissions Compliance

The commission anticipates that HRVOC emissions reductions for compliance with the site-wide cap in Harris County will have a significant fiscal impact on the petrochemical, chemical, and refining industries. The proposed rulemaking would require an additional 57% reduction of HRVOC emissions in the site-wide cap for Harris County. Furthermore, the proposed rulemaking will include emissions in the cap from emission events and scheduled startup, shutdown, and maintenance activities.

At least 93 Harris County sites may incur significant costs when complying with the proposed cap. Because companies are given flexibility in how to achieve cap compliance, the commission staff is unable to provide a total cost estimate per process or per site. Costs will vary widely depending on the methodology each company employs to reduce their HRVOC emissions. If the additional reductions require a company to install an additional control device for previously uncontrolled vent gas streams, the estimated capital and annual operating costs for a control device could be approximately $600,000 and $360,000 respectively, based on fiscal information provided in the 2002 HRVOC rule proposal.

SMALL BUSINESS AND MICRO-BUSINESS ASSESSMENT

The commission has been unable to identify any small or micro-businesses which would be affected by the proposed rulemaking. The majority of sites affected by the proposed rulemaking are large petrochemical and industrial businesses. If there are affected small or micro-businesses, the estimated capital and annualized cost in this fiscal note would be a reasonable cost estimate for small or micro-businesses.

LOCAL EMPLOYMENT IMPACT STATEMENT

The commission reviewed this proposed rulemaking action and determined that a local employment impact statement is not required because the proposed rulemaking does not adversely affect a local economy in a material way for the first five years that the proposed rulemaking is in effect.

DRAFT REGULATORY IMPACT ANALYSIS DETERMINATION

The commission reviewed the proposed rulemaking action in light of the regulatory analysis requirements of Texas Government Code, §2001.0225, and determined that the rulemaking action meets the definition of a "major environmental rule" as defined in that statute. A "major environmental rule" is a rule the specific intent of which is to protect the environment or reduce risks to human health from environmental exposure and that may adversely affect in a material way the economy, productivity, competition, jobs, the environment, or the public health and safety of the state or a sector of the state.

The proposed rulemaking action to Chapter 115 and revisions to the SIP would improve implementation of the existing Chapter 115 by adding requirements to achieve reductions in HRVOC emissions in the HGA. The rules are intended to protect the environment and reduce risks to human health and safety from environmental exposure and may have adverse effects on owners and operators of certain sources, in particular fugitives, flares, process vents, and cooling towers. Many of these sources are owned or operated by utilities, petrochemical plants, refineries, and other industrial, commercial, or institutional groups, and each group could be considered a sector of the economy. This determination is based on the analysis provided elsewhere in this preamble, including the discussion in the PUBLIC BENEFITS AND COSTS section of this proposal. The remaining amendments in this rulemaking are intended to correct typographical errors, update cross-references, add flexibility and delete obsolete language, and these amendments are not expected to adversely affect in a material way the economy, productivity, competition, jobs, the environment, or the public health and safety of the state or a sector of the state.

This proposed rulemaking does not meet any of the four applicability criteria of a "major environmental rule" as defined in the Texas Government Code. Texas Government Code, 2001.0225 applies only to a major environmental rule the result of which is to: 1) exceed a standard set by federal law, unless the rule is specifically required by state law; 2) exceed an express requirement of state law, unless the rule is specifically required by federal law; 3) exceed a requirement of a delegation agreement or contract between the state and an agency or representative of the federal government to implement a state and federal program; or 4) adopt a rule solely under the general powers of the agency instead of under a specific state law.

The rulemaking implements requirements of 42 USC. Under 42 USC, §7410, states are required to adopt a SIP that provides for "implementation, maintenance, and enforcement" of the primary national ambient air quality standards (NAAQS) in each air quality control region of the state. While 42 USC, §7410, does not require specific programs, methods, or reductions in order to meet the standard, SIPs must include "enforceable emission limitations and other control measures, means or techniques (including economic incentives such as fees, marketable permits, and auctions of emissions rights), as well as schedules and timetables for compliance as may be necessary or appropriate to meet the applicable requirements of this chapter," (meaning Chapter 85, Air Pollution Prevention and Control). It is true that 42 USC does require some specific measures for SIP purposes, such as the inspection and maintenance program, but those programs are the exception, not the rule, in the SIP structure of 42 USC. The provisions of 42 USC recognize that states are in the best position to determine what programs and controls are necessary or appropriate in order to meet the NAAQS. This flexibility allows states, affected industry, and the public, to collaborate on the best methods to attain the NAAQS for the specific regions in the state. Even though 42 USC allows states to develop their own programs, this flexibility does not relieve a state from developing a program that meets the requirements of 42 USC, §7410. Thus, while specific measures are not generally required, the emission reductions are required. States are not free to ignore the requirements of 42 USC, §7410, and must develop programs to assure that the nonattainment areas of the state will be brought into attainment on schedule.

The requirement to provide a fiscal analysis of proposed regulations in the Texas Government Code were amended by Senate Bill (SB) 633 during the 75th Legislature (1997). The intent of SB 633 was to require agencies to conduct an regulatory impact analysis (RIA) of extraordinary rules. These are identified in the statutory language as major environmental rules that will have a material adverse impact and will exceed a requirement of state law, federal law, or a delegated federal program, or are adopted solely under the general powers of the agency. With the understanding that this requirement would seldom apply, the commission provided a cost estimate for SB 633 that concluded "based on an assessment of rules adopted by the agency in the past, it is not anticipated that the bill will have significant fiscal implications for the agency due to its limited application." The commission also noted that the number of rules that would require assessment under the provisions of the bill was not large. This conclusion was based, in part, on the criteria set forth in the bill that exempted proposed rules from the full analysis unless the rule was a major environmental rule that exceeds a federal law. As discussed earlier in this preamble, 42 USC does not require specific programs, methods, or reductions in order to meet the NAAQS; thus, states must develop programs for each nonattainment area to ensure that area will meet the attainment deadlines. Because of the ongoing need to address nonattainment issues, the commission routinely proposes and adopts SIP rules. The legislature is presumed to understand this federal scheme. If each rule proposed for inclusion in the SIP was considered to be a major environmental rule that exceeds federal law, then every SIP rule would require the full RIA contemplated by SB 633. This conclusion is inconsistent with the conclusions reached by the commission in its cost estimate and by the Legislative Budget Board in its fiscal notes. Because the legislature is presumed to understand the fiscal impacts of the bills it passes, and that presumption is based on information provided by state agencies and the Legislative Budget Board, the commission believes that the intent of SB 633 was only to require the full RIA for rules that are extraordinary in nature. While the SIP rules will have a broad impact, that impact is no greater than is necessary or appropriate to meet the requirements of 42 USC. For these reasons, rules adopted for inclusion in the SIP fall under the exception in Texas Government Code, §2001.0225(a), because they are specifically required by federal law.

In addition, 42 USC, §7502(a)(2), requires attainment as expeditiously as practicable, and 42 USC, §7511a(d), requires states to submit ozone attainment demonstration SIPs for severe ozone nonattainment areas such as the HGA. The proposed rules, that will reduce ambient HRVOC and ozone in the HGA, will be submitted to the EPA as one of several measures in the federally approved SIP. As discussed earlier in this preamble, controls on upsets and routine industrial VOC emissions are necessary to address some of the elevated ozone levels observed in the HGA; these controls will result in reductions in ozone formation in the HGA and help bring the HGA into compliance with the air quality standards established under federal law as NAAQS for ozone. As discussed in Chapter 6 of the HGA SIP, this revision is another phase in the process of continued analysis and review of the science, and the data collected as a result of these revisions will further assist the commission as it develops its full reassessment of the attainment demonstration at the midcourse review. Therefore, the proposed rulemaking is a necessary component of and consistent with the HGA ozone attainment demonstration SIP required by 42 USC, §7410.

The commission has consistently applied this construction to its rules since this statute was enacted in 1997. Since that time, the legislature has revised the Texas Government Code but left this provision substantially unamended. The commission presumes that "when an agency interpretation is in effect at the time the legislature amends the laws without making substantial change in the statute, the legislature is deemed to have accepted the agency's interpretation." Central Power & Light Co. v. Sharp , 919 S.W.2d 485. 489 (Tex. App. Austin 1995), writ denied with per curiam opinion respecting another issue , 960 S.W.2d 617 (Tex. 1997); Bullock v. Marathon Oil Co. , 798 S.W.2d 353, 357 (Tex. App. Austin 1990), no writ . Cf. Humble Oil & Refining Co. v. Calvert , 414 S.W.2d 172 (Tex. 1967); Sharp v. House of Lloyd, Inc. , 815 S.W.2d 245 (Tex. 1991); Southwestern Life Ins. Co. v. Montemayor , 24 S.W.3d 581 (Tex. App. Austin 2000), pet. denied ; and Coastal Indust. Water Auth. v. Trinity Portland Cement Div. , 563 S.W.2d 916 (Tex. 1978).

As discussed earlier in this preamble, this rulemaking action implements requirements of 42 USC. There is no contract or delegation agreement that covers the topic that is the subject of this action. Therefore, the proposed rulemaking does not exceed a standard set by federal law, exceed an express requirement of state law, exceed a requirement of a delegation agreement, nor adopted solely under the general powers of the agency. Finally, this rulemaking action was not developed solely under the general powers of the agency, but is authorized by specific sections of Texas Health and Safety Code, Chapter 382 (also known as the Texas Clean Air Act), and Texas Water Code that are cited in the STATUTORY AUTHORITY section of this preamble, including Texas Health and Safety Code, §§382.011, 382.012, 382.014, 382.016, 382.017, 382.021, and 382.034. Therefore, this rulemaking action is not subject to the regulatory analysis provisions of Texas Government Code, §2001.0225(b), because the proposed rulemaking does not meet any of the four applicability requirements. The commission invites public comment on the draft RIA determination.

TAKINGS IMPACT ASSESSMENT

The commission completed a takings impact analysis for the proposed rulemaking action under Texas Government Code, §2007.043. The specific purposes of this rulemaking are to achieve reductions of HRVOC emissions and ozone formation in the HGA and help bring the HGA into compliance with the air quality standards established under federal law as NAAQS for ozone, as well as to improve implementation of the existing Chapter 115 by correcting typographical errors, updating cross-references, clarifying ambiguous language, adding flexibility, and deleting obsolete language. If adopted, certain sources located in the HGA will be required to install equipment to monitor emissions and achieve HRVOC emission reductions in the HGA, and implement new reporting and recordkeeping requirements. Installation of the necessary equipment could conceivably place a burden on private, real property.

Texas Government Code, §2007.003(b)(4), provides that Chapter 2007 does not apply to this proposed rulemaking action, because it is reasonably taken to fulfill an obligation mandated by federal law. The emission limitations and control requirements within this rulemaking action were developed in order to meet the ozone NAAQS set by the EPA under 42 USC, §7409. States are primarily responsible for ensuring attainment and maintenance of NAAQS once the EPA has established them. Under 42 USC, §7410, and related provisions, states must submit, for approval by the EPA, SIPs that provide for the attainment and maintenance of NAAQS through control programs directed to sources of the pollutants involved. Therefore, one purpose of this rulemaking action is to meet the air quality standards established under federal law as NAAQS. Attainment of the ozone standard will eventually require reductions of HRVOC emissions, as well as substantial reductions in NO _x emissions. Any VOC reductions resulting from the current rulemaking are no greater than what scientific research indicates is necessary to achieve the desired ozone levels. However, this rulemaking is only one step among many necessary for attaining the ozone standard.

In addition, Texas Government Code, §2007.003(b)(13), states that Chapter 2007 does not apply to an action that: 1) is taken in response to a real and substantial threat to public health and safety; 2) is designed to significantly advance the health and safety purpose; and 3) does not impose a greater burden than is necessary to achieve the health and safety purpose. Although the rules do not directly prevent a nuisance or prevent an immediate threat to life or property, they do prevent a real and substantial threat to public health and safety and significantly advance the health and safety purpose. This action is taken in response to the HGA exceeding the federal ozone NAAQS, that adversely affects public health, primarily through irritation of the lungs. The action significantly advances the health and safety purpose by reducing ozone levels in the HGA. Consequently, these proposed rules meet the exemption in §2007.003(b)(13). This rulemaking action therefore meets the requirements of Texas Government Code, §2007.003(b)(4) and (13). For these reasons, the proposed rules do not constitute a takings under Chapter 2007.

CONSISTENCY WITH THE COASTAL MANAGEMENT PROGRAM

The commission reviewed the proposed rulemaking action and found that the proposal is an action identified in Coastal Coordination Act Implementation Rules, 31 TAC §505.11, or will affect an action/authorization identified in §505.11, and therefore will require that applicable goals and policies of the Coastal Management Program (CMP) be considered during the rulemaking process.

The commission determined that under 31 TAC §505.22 the proposed rulemaking action is consistent with the applicable CMP goals and policies. The CMP goal applicable to this rulemaking action is the goal to protect, preserve, and enhance the diversity, quality, quantity, functions, and values of coastal natural resource areas (31 TAC §501.12(1)). No new sources of air contaminants will be authorized and ozone levels will be reduced as a result of the proposed rulemaking. The CMP policy applicable to this rulemaking action is the policy that commission rules comply with regulations in 40 CFR, to protect and enhance air quality in the coastal area (31 TAC §501.14(q)). This rulemaking action complies with 40 CFR. Therefore, in compliance with 31 TAC §505.22(e), this rulemaking action is consistent with CMP goals and policies. Interested persons may submit comments on the consistency of the proposed rules with the CMP during the public comment period.

EFFECT ON SITES SUBJECT TO THE FEDERAL OPERATING PERMIT PROGRAM

Chapter 115 is an applicable requirement under 30 TAC Chapter 122; therefore, owners or operators subject to the Federal Operating Permit Program must, consistent with the revision process in Chapter 122, revise their operating permits to include the revised Chapter 115 requirements for each emission unit affected by the revisions to Chapter 115 at their sites.

ANNOUNCEMENT OF HEARINGS

Public hearings for this proposed rulemaking have been scheduled for the following times and locations: August 2, 2004, 1:30 p.m. and 5:30 p.m., City of Houston, City Council Chambers, 2nd Floor, 901 Bagby, Houston; August 3, 2004, 10:30 a.m., John Gray Institute, 855 Florida Avenue, Beaumont; and August 5, 2004, 9:30 a.m., Texas Commission on Environmental Quality, 12100 North I-35, Building F, Room 2210, Austin. The hearings will be structured for the receipt of oral or written comments by interested persons. Registration will begin 30 minutes prior to the hearings. Individuals may present oral statements when called upon in order of registration. A time limit may be established at the hearings to assure that enough time is allowed for every interested person to speak. There will be no open discussion during the hearings; however, commission staff members will be available to discuss the proposal 30 minutes before the hearings and will answer questions before and after the hearings.

Persons planning to attend the hearings who have special communication or other accommodation needs, should contact the Office of Environmental Policy, Analysis, and Assessment at (512) 239-4900. Requests should be made as far in advance as possible.

SUBMITTAL OF COMMENTS

Written comments may be submitted to Patricia Durón, MC 205, Office of Environmental Policy, Analysis, and Assessment, Texas Commission on Environmental Quality, P.O. Box 13087, Austin, Texas 78711-3087, faxed to (512) 239-4808, or emailed to siprules@tceq.state.tx.us . All comments should reference Rule Project Number 2004-037-115-AI. Comments must be received by 5:00 p.m., August 9, 2004. For further information, please contact Ashley Forbes of the Environmental Planning and Implementation Division at (512) 239-0493 or Alan Henderson, of the Policy and Regulations Division, at (512) 239-1510.

Subchapter A. DEFINITIONS

Subchapter D. PETROLEUM REFINING, NATURAL GAS PROCESSING, AND PETROCHEMICAL PROCESSES