Minnesota Pollution Control Agency (MPCA)

Letter from MPCA Stakeholders to Fred Hanson, et al.

UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
REGION 5
77 WEST JACKSON BOULEVARD
CHICAGO, IL 60604-3590 July 02 1996

REPLY TO THE ATTENTION OF:
R-19J

Mr. Charles W. Williams
Commissioner
Minnesota Pollution Control Agency
520 Lafayette Road
Saint Paul, Minnesota 55155-4194
Re: Minnesota XL-Permit No. 96-01 and Final

Project Agreement for 3M Hutchison,
Minnesota Facility

Dear Mr. Williams:
The United States Environmental Protection Agency (EPA) appreciates the opportunity to comment on the Minnesota Pollution Control Agency (MPCA), 3M Company, and stakeholder Project XL design of a simplified approach to environmental regulation for the Hutchison facility. Enclosed are our comments. EPA believes that the project could be a valuable experiment and is optimistic that all parties can work together to resolve any remaining issues. To that end, EPA is willing to engage in discussions beginning immediately at a location most convenient for MPCA, 3M, and stakeholders. Marilou Martin of my staff will contact Lisa Thorvig of your staff to discuss next steps. If you have any questions, please contact me directly.
Sincerely,

Valdas V. Adamkus
Regional Administrator

MinnesotaXL Permit/Final Project Agreement Comments

As we read the draft permit/FPA, MPCA and 3M are proposing a system with three critical elements:

Emission caps: Absolute pollutant caps for the site as a whole set at levels that assure baseline protection of human health and the environment.

Superior performance: Periodic bench marking of the real measured impact of the site as a whole to ensure that actual emissions are below what actual emissions would have been under otherwise applicable requirements.

Flexibility: Empowerment of the Company to modify or replace equipment, processes, product lines etc., without prior approval of MPCA.

EPA offers the following general comments with respect to emission caps and superior environmental performance and is immediately available to discuss specific language to be incorporated into the permit/FPA.

Preamble: With respect to the scope of the permit/FPA, currently the preamble states that the permit/FPA applies to tape and coating. This language needs to be revised to tape coating. It is EPA's understanding that if 3M wishes to conduct activities unrelated to tape coating, that 3M will seek amendment of the permit.

Emission caps: It is EPA's understanding that under the terms of the MinnesotaXL permit/FPA, the site would under no circumstances be allowed to emit at levels above the caps set forth in that permit/FPA for criteria and hazardous air pollutants (HAPs). MPCA has performed a risk analysis, and included the risk mechanisms in the permit/FPA, to ensure that emissions at or below the levels contained in these caps are portective of human health and the environment. The Federal CAA programs do not require this risk analysis or mechanism, and therefore, EPA does not endorse or otherwise concur with this element of the proposal.

The emission limit cap for criteria air pollutants (PM10, CO, SOx, and Nox) will apply only to existing boilers running. Any change or significant modification to existing boilers will require prior MPCA review and approval, and be subject to otherwise applicable requirements.

With respect to the criteria pollutant caps, MPCA has submitted a demonstration that emissions at the levels contained in these caps would not cause or contribute to a violation of the National Ambient Air Quality Standards. EPA believes that such demonstration must conform to the analytic standards it would use in making such an assessment as part of the PSD permit/FPA process. The following concerns need to be resolved:

*Supporting information (i.e., modeling runs, plant layout, operating parameters) should be supplied in order to conduct a thorough modeling analysis. (Appendix C of Appendix W and Section 9 of Appendix W). It needs to be defined as to whom is the receiver and sender of these items. (i.e., from the state to USEPA?)

*Emission sources/processes that were modeled as point sources or the volume source need to be identified. Additional discussion on rationale for the volume source is warranted. Any sensitivity model runs and discussions on the various point source/volume source scenarios should be submitted to strengthen the rationale. (Appendix C of Appendix W and Subsection 9.1 of Appendix W). (Possibly covered within Item 1 as listed above).

Also, calculations for the source emission estimates need to be included. Incorporate all reference materials needed to calculate such emission estimates. This may have already been requested by other EPA officials for permit/FPA purposes.

*A more refined analysis of receptor "hot spot" needs to be identified and possibly discussed. If already completed, (possibly covered within Item 1 as listed above), submit such modeling run results. (Section 3 of Users Guide for ISC3 Dispersion Model, Volume I and Appendix C of Appendix W).

*Additional "nearby" sources should be included in the modeling runs, if applicable. The monitored background concentration can then be added to the possible new modeled concentration. (Subsection 9.2 of Appendix W).

*The methodology that the company can use to assure continued compliance of the NAAQS needs to be discussed. The state gave information on growth concentrations which may need additional explanation. It could be understood that this is the remaining concentration available in the area up to the NAAQS concentrations.

With respect to the HAP cap of 3000 tons per year, contained in the draft permit/FPA, EPA agrees with the contention made by 3M and by MPCA that the otherwise applicable requirements of the NESHAP program would not at this time place a limit on total emissions of any HAP. However, the most important factor in favor of proposed HAP cap is the fact that it will work in concert with an annual bench marking of the real measured impact of the site as a whole to ensure that, on an air program to program basis, actual emissions are below what actual emissions would have been under otherwise applicable requirements. EPA understands that MPCA will also perform bench marking for the purpose of adjusting the HAP, criteria, and VOC caps.3

Prospective Standards: EPA believes that in order to ensure that 3M complies with MACT requirements, it may be necessary to conduct an advance CAA Section 112(g) MACT determinations for construction changes at the plant, such as conversion to sticky tape, and to set a prospective standard which could, for example, be expressed asaplant-widecontrol efficiency rate. So long as 3M operates at or below these prospective standards, it may modify the facilities without prior approval. EPA expects these standards to be enforceable.

Superior performance: Superior environmental performance is a condition of both the Minnesota XL and EPA Project XL programs. EPA believes that the permit/FPA needs to be modified so that the permittee shall, on a plant-wide basis for each pollutant, achieve actual emissions that are below what actual emissions would have been under otherwise applicable requirements. Failure to attain superior performance which would be assessed through bench marking as described below, would be grounds for, among other things, termination of the XL project. At a minimum, EPA will expect 3M's performance to be 1 0% better than what the CAA would require.

Bench marking: In order to verify compliance with terms of the permit/FPA, the permittee and MPCA should annually complete a regulatory analysis report. The regulatory analysis shall compare performance against two benchmarks: 1) actual emissions from plant versus what actual emissions would have been under otherwise applicable requirements, and 2) emission cap levels to allowable level under otherwise applicable requirements without technology backsliding.

The first benchmark in the regulatory analysis, a comparison of the plant-wide actual emissions achieved versus what the plant-wide emissions would have been under otherwise applicable requirements considering factors such as production levels and coating usage, is meant to ensure that the Minnesota XL permit/FPA achieves superior environmental performance. This is a requirement of both MinnesotaXL and EPA's Project XL.

In constructing this first bench marking in its regulatory analysis, MPCA should use the following protocols:

*Assume that the plant would have continued to operate voluntary control emission devices, procedures, or other actions not required by any otherwise applicable local, state or federal requirement.

*Emissions and emissions reductions should include those of any pollutant covered by the limits contained in the permit/FPA, not simply the pollutant that the otherwise applicable requirement was intended to address (e.g. the analysis of what would have occurred must account for the collateral criteria pollutant benefits of otherwise applicable requirements to control emissions of hazardous air pollutants).

*Otherwise applicable rules should include all federal, state and local rules affecting the facility at the time of the regulatory analysis, including new rules that have come into force since the date of issuance of the permit/FPA.

*In calculating the emissions and emission reductions from controls that were not implemented but would have been implemented as a result of otherwise applicable
requirements, MPCA should assume those controls operate at typical efficiencies unless in its best technical judgment another assumption is justified.

*With respect to production and production levels at the plant, timing of changes etc. MPCA should assume that these factors would have been the same under otherwise applicable requirements as they actually are under requirements of this permit/FPA.

*MPCA may wish to indicate, however, ways in which it believes production or production levels have been affected by the use of this permit/FPA versus otherwise applicable requirements.

*MPCA must take steps to ensure the integrity and proper treatment of information presented in this regard that would constitute Confidential Business Information.

In defining what controls would have been required by otherwise applicable requirements of the PSD program, MPCA should use the following protocols. MPCA should assume that PSD review would have been triggered (applicability requirement) by any physical modification to the facility except modifications subject to synthetic minor exemptions (any physical modification that would not have the potential to increase emissions by more than 40 tons per year). If PSD review would have been triggered under these assumptions, MPCA should assume that the unit would not have been permitted absent installation of Best Available Control Technology (BACT) as defined in the CAA, and normally implemented by MPCA.

To assist MPCA with its determination of what controls would have been implemented under otherwise applicable requirements, the permittee should maintain records of the dates of major modifications to each production line of the plant, equipment shutdown etc. (in the interim between regulatory analyses required by this permit/FPA, the permittee should be able to request from MPCA a determination of whether a particular control would have been required under otherwise applicable requirements, and the likely emissions implications of that control).

The permit/FPA should be clarified to make plain the consequences of failure to achieve superior environmental performance. EPA believes that emissions of any pollutant greater what actual emissions would have been under otherwise applicable requirements could result in termination of the permit/FPA and in a hasty return to otherwise applicable requirements.

To ensure that the site does not have the potential to emit more than it would under MACT requirements, EPA believes that a procedure should be included in the final permit/FPA to adjust the HAP caps as otherwise applicable rules and plant configurations change, such as the promulgation of a new MACT standard, or with modification to the site that would make an additional MACT standard or 112(g) requirements applicable. For purposes of calculating whether such an adjustment is necessary, allowable emissions are defined as what allowable HAP emissions under otherwise applicable requirements would have been, without technology backsliding - meaning the shutoff of pollution controls installed. In the event that the HAP cap exceeded the allowables emissions under otherwise applicable requirements, MPCA should amend the permit/FPA by lowering cap to a point below that level.

Likewise, there must be a procedure in place to adjust criteria emission caps as applicable rules and plant configuration change.

The permit/FPA should be clarified to make plain the consequences of violation of the emissions caps. EPA believes that violation of these caps would constitute a violation of the permit/FPA, subject to enforcement action under the authorities of Minnesota law and the CAA. Furthermore, EPA believes that violation of these caps should result in unilateral termination of the permit/FPA by MPCA and/or EPA and a speedy return to compliance with the CAA.

Title 5: A Title 5 permit requirements cannot be waived. Therefore, the permit/FPA must be substantively equivalent to a Title 5 permit, including but not limited to:

1. 5 year term limit;
2. opportunity for public participation with respect to modifications and permit/FPA reissuance;
3. line-by-line recordkeeping and monitoring, and reporting as required by otherwise applicable requirements; and
4. inspection, entry, and compliance certification requirements.

EMS: Any element of the EMS designed to assure compliance must be subject to review and approval by MPCA and EPA. 3M must comply with all otherwise applicable recordkeeping, reporting and monitoring requirements. Although the permit/FPA references many requirements that will be varied under the permit/FPA, EPA would not support any substantive variation in monitoring, reporting and recordkeeping requirements under EPCRA, CAA, and RCRA. Also, EPA believes monitoring data must be recorded on a daily basis for information purposes and included in the quarterly reports.

EPCRA: EPA believes that the 24 hour notification of emergency spills and releases is not acceptable, as this time period could permit/FPA adverse public health and environmental exposures. Pursuant to Section 304(b)(1) of EPCRA (42 U.S.C. Section 11004(b)(1))and Section 103 of CERCLA, notification must be immediate.

RCRA: EPA believes that extension to 180 days of the storage standards applicable to generators of hazardous waste must only be applied to on-site generated waste and materials. 40 CFR part 265 subpart CC is not yet effective, and EPA can not justify an alternative approach before the subpart is finalized.

Water: It is EPA's understanding that the permit/FPA does not allow unspecified, nonstormwater discharge.

Unilateral Withdrawal: Under the FPA, all parties must have the ability to unilaterally withdraw from the agreement at any time and for any reason. Assuming agreement is reached by the parties, it would be EPA's intent that the FPA be fully implemented.

FPA - Legal and Enforcement: Language describing the Minnesota statute may require a qualifier or clarification. EPA would not agree that waivers under the State statute have any affect on Federal requirements.

EPA is still considering legal mechanisms for reconciling the permit/FPA to the federal environmental requirements. No mechanisms have been eliminated, including enforcement discretion. Therefore, we are not sure what can or will be included in site-specific rule making by EPA. Consequently the FPA must be modified to the extent the FPA purports to describe or otherwise limit the federal rulemaking.

Flexibility: The final permit/FPA should, to the greatest extent possible, empower the Company to modify or replace equipment, process, product lines etc. EPA believes that under the terms described here, a final permit/FPA can be constructed that provides the level of flexibility sought by 3M, as indicated in the draft, while ensuring not simply basic protection of human health and the environment, but superior environmental performance.

Minnesota Pollution Control Agency (MPCA)

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