Business Roundtable

NESHAPS for Industrial, Commercial and Institutional Boilers

Background

Section 112 of the Clean Air Act (CAA) requires EPA to establish National Emissions Standards for Hazardous Air Pollutants (NESHAPS) for both major and area sources of hazardous air pollutants (HAPS) that are subject to regulation.  A major source is defined as a stationary source that emits or has the potential to emit 10 tons per year (tpy) or more of any single HAP or 25 tpy or more of any combination of the 187 HAPS subject to regulation.  HAPS are different from other types of air pollutants (e.g., sulfur dioxide, nitrogen dioxide, and particulate matter) that are regulated under other provisions of the CAA.  An area source is defined as a stationary source that emits HAPS but that is not a major source.

For area sources, Section 112 requires that EPA develop NESHAPS applicable to area sources that represent 90 percent of the area source emissions of the 30 HAPS that present the greatest threat to public health in the largest number of urban areas.  Those HAPS are listed on the Urban HAPS List for the Integrated Urban Air Toxics Strategy implemented under Section 112.

Major sources generally must install and operate maximum achievable control technology (MACT) to limit HAPS emissions.  For new sources, MACT-based emissions standards cannot be less stringent than the emissions control achieved in practice by the best-controlled similar source.  MACT-based emissions standards for existing sources may be less stringent than standards for new sources but shall not be less stringent than the average emission limitation achieved by the best performing 12 percent of existing sources (or the best performing five sources for source categories with less than 30 sources).

Area sources generally must install and operate generally available control technology (GACT) to limit HAPS emissions.  GACT consists of methods, practices and techniques which are commercially available and appropriate for application by area sources in light of economic impacts and the technical capabilities of the firms to operate and maintain the emissions control systems.

On September 13, 2004, EPA issued final rules that established NESHAPS for new and existing industrial, commercial and institutional boilers and process heaters.  The rules were appealed, however, and on June 19, 2007, the U.S. Court of Appeals for the D.C. Circuit vacated and remanded the NESHAPS.

Overview of Rulemaking

On February 21, 2011, EPA issued separate final rules to reduce HAPS emissions from existing and new industrial, commercial and institutional boilers and process heaters located at major sources and reduce HAPS emissions from existing and new industrial, commercial and institutional boilers located at area sources.  The final rules reflect numerous revisions from rules proposed in April 2010.  The final rules were issued in accordance with a consent decree approved by a federal court.

The pollutants that will be controlled under the final rules include mercury, particulate matter (PM) (as a surrogate for non-mercury metals) and carbon monoxide (CO) (as a surrogate for organic air toxics).  In addition, dioxin and hydrogen chloride will be controlled under the final rule for major sources. 

Under the final rule for major sources, new and existing gas-fired boilers will be subject to a work practice standard (instead of emissions limits) and will be required to perform an annual boiler tune-up.  New and existing boilers with a heat input capacity of less than 10 MMBtu/hr will be subject to a work practice standard and will be required to perform a biennial boiler tune-up.  All other new and existing boilers (except limited use boilers) and process heaters will be subject to emissions limits and compliance monitoring.  Finally, existing major sources will be required to conduct a one-time energy assessment.

Under the rule for area sources, new coal-fired boilers with a heat input capacity of 10 MMBtu/hr or more will be subject to emissions limits for mercury, PM and CO.  New biomass-fired and oil-fired boilers with a heat input capacity of 10 MMBtu/hr or more will be subject to emissions limits for PM.  New boilers with a heat input capacity of less than 10 MMBtu/hr will be required to perform a biennial boiler tune-up.  Existing coal-fired boilers with a heat input capacity of 10 MMBtu/hr or more will be subject to emissions limits for mercury and CO.  Existing biomass-fired and oil-fired boilers and coal-fired boilers with a heat input capacity of less than 10 MMBtu/hr will be required to perform a biennial boiler tune-up.  Finally, area sources with boilers with a heat input capacity of 10 MMBtu/hr or more will be required to conduct an energy assessment.

Current Status

In addition to the final rules, EPA issued a Notice of Reconsideration of Final Rules.  The Reconsideration Notice, which applies to the final rules for major and area sources as well as to a final rule on commercial and industrial solid waste incineration units, states that “we recognize that certain issues of central relevance to these rules arose after the period for public comment or may have been impracticable to comment upon.”  Thus the Reconsideration Notice initiates a reconsideration of several issues in these rules.  The Reconsideration Notice specifies fourteen issues for reconsideration.  EPA also has stated that it will evaluate requests for reconsideration submitted to the agency.  On May 18, 2011, EPA delayed the effective date of these rules until the proceedings for judicial review of the rules are completed or EPA completes its reconsideration of the rules, whichever is earlier.  Comments on specific issues on reconsideration were due no later than July 15, 2011.  EPA is expected to issue final rules in 2012.

Potential Impact of Regulation

According to an EPA Fact Sheet on the final rule for major sources, there are approximately 13,840 boilers and process heaters at major sources in the United States.  The Fact Sheet estimates that the cost of controls to implement the rule will be more than $5 billion.

According to an EPA Fact Sheet on the final rule for area sources, there are approximately 187,000 boilers at 92,000 facilities at area sources in the United States.  Most of those area source boilers are located at commercial and institutional facilities and, in general, are owned and operated by small entities.  The Fact Sheet estimates that the installation and maintenance of controls to implement the rule will be $487 million per year. 

Given the limits on emissions and the number of industrial sources affected, the final rules, although they reflect numerous revisions from rules proposed in April 2010, will still be extremely costly and disruptive.  Moreover, a number of older facilities may be required to close given the magnitude of the costs for installation and maintenance of controls to implement the rules.  Permitting required at the number of affected facilities alone will be extremely challenging. 

Please note:  This document is current only as of the date listed above.