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Letter from EPA to NRDC

On behalf of EPA, thank you for your letter of July 3, 1996, regarding the Intel XL project in Chandler, Arizona. You raise a number of important points that have and will continue to help shape EPA's positions on the project. While EPA has yet to propose approval of or to formally solicit public comment on a Final Project Agreement for the Intel project, I want to share with you the Agency's current thinking on the points you raise and to supplement the information you have been receiving from various members of the Intel XL project team during the course of project development.

Your letter and our recent conversations confirm the fact that NRDC shares EPA's principal goal for Project XL - achieving superior environmental performance. The Intel project must, and we believe will, deliver to the people of Chandler real multi-media reductions in pollution and greater protection of human health and the environment relative to what would have been delivered without XL. Under the FPA, Intel commits to:

Beyond its environmental impacts, the Intel project has important economic and community benefits. A simplified regulatory environment will allow the company to make rapid changes in its production line without extensive pre-construction reviews that can at times last longer than it takes Intel to develop its products in the first place. This regulatory environment will help the company to create over 2000 high-skill jobs in its new Chandler facility, and to further expand operations in Chandler in the future. Continuation of the highly public and inclusive process of creating the project, while never perfect and sometimes painful, will itself strengthen common understanding on environmental issues among the various interests in the Chandler community.

But our principal goal and yours is to create a project that achieves superior environmental performance relative to what would happen absent XL. Your specific comments on this point can be grouped into four general areas: (1) concern about the impacts of hazardous air pollutant emissions; (2) desire to see the project achieve substantial progress in pollution prevention; (3) concern for worker safety; (4) questions regarding the measurement of environmental outcomes; and (5) questions on the use of risk analysis.

(1) Hazardous Air Pollutant Emissions

Many of your comments address the protectiveness of regulation of HAP emissions under the Intel XL project. I want to be clear that the Intel project will comply with all applicable local, state and federal statutory and regulatory requirements regarding the control of HAPs, including requirements concerning the emissions of specific pollutants as well as the entire class of HAPs. As you know, Intel, local stakeholders, and regulators at all levels have worked together to apply existing legal requirements more effectively, and to supplement these requirements with additional environmental goals. In this sense, the Intel project exemplifies the point you make in your letter concerning the potential to achieve significant environmental progress without departure from the letter of existing requirements.

However, to achieve superior environmental performance with respect to HAP emissions, the Intel project must also go beyond compliance with applicable rules. We believe that the project does this in several respects. For example, to merit minor source classification, the Clean Air Act establishes a 25-tons/year limit for emissions from all HAPs combined and a 10-tons/year limit for emissions from any one HAP. Under XL, Intel would commit to establishing permit limits at 20-tons/year for all HAPs and a 10-ton/year limit each for emissions from all organic and inorganic HAPs. The 10-ton/year limit for inorganic HAPs includes a 5-ton/year limit for emissions from phosphine, a pollutant of specific concern.

Intel would supplement these over-all HAP limitations by demonstrating that no permitted emissions exceed AAAQGs at its property line. Before using any chemical that might pose a risk to human health or the environment in its processes-whether or not regulated under the Clean Air Act-Intel would perform screen modeling at 10-ton/year levels to demonstrate that AAAQGs would not be exceeded at the property line. If the model demonstrates otherwise, Intel would limit annual emissions of any such chemical to ensure consistency with the AAAQGs (as it has already proposed to commit to doing for phosphine). The idea of this analysis is to estimate a worst case for each chemical, determine whether that case would pose any risk, and if so, to put in place limits on that pollutant that prevent such risk. Again, this kind of protection goes well beyond what Intel would do without XL. Intel's proposed permit provisions thus go "beyond compliance" while providing the company with a measure of the operational flexibility it seeks. Furthermore, the project provides more and not less protection against a trade of less toxic HAPs for more toxic HAPs than would be provided absent XL.

You are quite right in stating that the emission limits are "intended to accommodate" the entire Ocotillo site, and not just the existing facility. We believe that this makes the emission limits more, rather than less, stringent. As a requirement of the proposed air permit, Intel may make operational changes on this site if and only if those changes do not result in emissions that exceed the permit's limits. In addition to complying with permit limits, a second facility-if built-must be compatible with the same type of controls and monitoring requirements established for the first facility.

Your comments also reference Toxic Release Inventory (TRI) data, comparing the actual performance of other semiconductor facilities to the proposed permit limits for Intel. As you point out, many semiconductor facilities operate with aggregate TRI releases below the proposed permit limits. EPA believes that comparisons of Intel's Chandler facility to other semiconductor plants should be part of the project, but that the comparison should be of actual performance and should account for the vast differences among different facilities in this industry. It is certainly appropriate for those evaluating the project to compare its actual progress in these areas to other similar facilities-as you put it in your comments-to "benchmark." It is our expectation that a successful project would compare favorably. But we do not believe it makes sense to compare actual performance of one facility against the absolute permit limits proposed for Intel. Finally, Intel is committing to reporting its air emissions on the Internet and will report these emissions on a per unit of production basis as well as on an aggregate basis. These commitments should assist the interested public in making normalized comparisons of actual environmental performance at Chandler with other facilities and to make their own assessments concerning the facility's progress in this area.

(2) Pollution Prevention

EPA believes, as you do, that pollution prevention will be necessary if superior environmental performance is to be achieved in the Intel project. The FPA includes company commitments to reducing solid and hazardous waste, reducing the use of fresh-water, reducing employee commuting, and establishing property set-backs that surpass current requirements. Air provisions within the FPA other than those covering HAPs establish CO, SO2, NOx, and PM-10 limits at amounts lower than those that exist under Intel's current permit. The establishment of a HAP limit on a per unit of production basis, which Intel would commit to in the Final Project Agreement (FPA), is a key driver for toxics reduction and pollution prevention. Such a limit ensures that the "pollution efficiency ratio" to which you refer does not increase as a result of operational modifications or expanded production.

But, as your comments suggest, pollution prevention is not just an outcome, it is an ongoing process to find new ideas. In your comments, you lay out a fairly elaborate mechanism to encourage pollution prevention. While EPA does not believe that the specifics of your comments must be incorporated into the project, we do endorse the basic idea - an ongoing process to develop pollution prevention concepts which includes local stakeholders and is integrated into the basic business decisions of the company. We believe that one benefit of the public process used to create the project is a cohesive, well-defined stakeholder group including individuals well equipped to continue to help Intel find ways to reduce pollution. Like you, we are pleased that this group will continue to function as the project is implemented. In addition, Intel is committing to measures that will provide a broader segment of the public with the ability to judge its progress in this area. As part of its corporate philosophy of Designing for the Environment, Intel has established a cross-corporation council to ensure that Intel's facilities, products and processes are designed with improvements in chemical, water and energy use for each generation of production technology. EPA expects to continue to work closely with the general public and with local stakeholders including members of Intel's Community Advisory Panel to review the company's performance towards pollution prevention and the goals established in the FPA.

(3) Worker Safety

Your comments on HAP emissions also address the more specific concern for worker safety. Again let me be clear that Intel will comply fully with all applicable requirements concerning air quality and other aspects of worker safety. Intel will also go beyond compliance in this respect by demonstrating that exposure to HAPs on site is consistent with 1-hour exposure guidelines in the AAAQGs. If the model demonstrates otherwise, Intel would either have to limit its use of the compound in question to amounts consistent with the AAAQGs or to provide additional analysis in consultation with the regulators to demonstrate that workers are not at risk. As you know, Intel line-workers have had many opportunities to provide input into the FPA development process. Like NRDC, EPA believes that greater involvement of line-workers in the project as it proceeds will improve not only worker safety, but overall efforts to reduce and prevent pollution.

(4) Measurement of Environmental Impacts

Finally, your comments address the need for careful monitoring of actual emissions as part of the project. Volatile Organic Compound (VOC) emissions from the site will be calculated using mass balancing. Intel will make the fairly conservative assumption that all VOCs used on site less all VOCs recovered through its control system is released to the atmosphere. HAPs will be computed through the use of emission factors, developed through analytical testing of process tools. (In this case, the actual factors are dependent upon information considered confidential business information (CBI) by the company. State and Federal regulators and others, who are bound by CBI rules, have reviewed the development of emission factors and are satisfied with the accuracy of the methods used.)

(5) Risk Analysis

The term "risk analysis" when describing Intel's proposed treatment of HAPs should be used advisedly to avoid confusion. The project does not intend to substitute risk analysis for otherwise applicable legal requirements. While the AAAQGs are risk-based (Will Humble, of the Arizona Department of Health Services, should be able to provide greater detail on how these guidelines were developed), Intel intends only to demonstrate that the AAAQGs are not exceeded through its use of screen models.

In summary, we believe that the Intel project can address the important substantive issues you raise in your letter of July 3. Your continued comments on this and other XL projects, and most importantly the focus of those comments on environmental performance, is critical to the success of XL. As such, I thank you again for your continued interest and participation in Project XL. If you have further questions or comments please contact the XL Intel project leads: Jeff Rosenbloom of EPA's Region 9 (415-744-1962), or Pasky Pascual, who is in my staff (202-260-6887).

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