E [C]/R Incorporated
                  Providing Environmental Technical Support Since 1989




MEMORANDUM   

DATE:		April 1, 2011

TO:		Melanie King, EPA OAQPS/SPPD/ESG

FROM:	Tanya Parise, EC/R, Inc.

SUBJECT:	Summary of the March 23, 2011 Meeting with AEA Regarding Issues Related to Rural Sources in Alaska Subject to the CI NSPS

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INTRODUCTION

      A meeting was held between EPA and the Alaska Energy Authority (AEA) to discuss AEA concerns related to stationary compression ignition (CI) engines located in remote areas of Alaska that are subject to new source performance standards (NSPS) in 40 CFR part 60, subpart IIII.  EPA proposed amendments to the NSPS on June 8, 2010 (75 FR 32612).  
      
ATTENDEES

Michael Horowitz, EPA
Tanya Parise, EC/R (by phone)
Bob Wayland, EPA (by phone)
Chris Mello, Alaska Industrial Development and Export Authority
Melanie King, EPA (by phone)
Steve Stassel, Alaska Energy and Engineering
Heather Valdez, EPA (by phone)


SUMMARY OF MEETING 

	Representatives of AEA requested to meet with EPA to discuss the unique issues affecting stationary diesel engines in rural areas of Alaska as they relate to complying with the requirements of the CI NSPS.  Prior to the meeting, AEA submitted a letter to EPA with information on the various issues facing rural source diesel engines in Alaska.  Only the major points discussed during the meeting are repeated here, and further details can be found in AEA's letter to EPA, which are available in the docket (EPA-HQ-OAR-2010-0295).

	In general, AEA expressed that it is concerned with the lack of availability of diesel engines in rural Alaskan villages that can meet EPA's Tier 4 emission standards and with the high cost associated with meeting these standards in rural Alaskan villages.  AEA said that it believes that the costs EPA has estimated for the rule are substantially lower than what compliance would realistically cost in rural portions of Alaska.  

	EPA noted that affected sources are not limited to acquiring only Tier 4 certified engines to demonstrate compliance.  EPA pointed out that sources have the option of purchasing pre-Tier 4 engines, for instance a Tier 3 engine, and putting aftertreatment on that engine.  Further, there are several catalyst vendors on the market who have available systems for aftertreatment that have been verified by the California Air Resources Board (CARB) and EPA.  For example, there are systems available that are certified to obtain at least an 85 percent reduction of particulate matter (PM) emissions that have been certified by CARB.  EPA suggested that AEA at a minimum expand the search of available compliance options for engines in Alaska.  AEA noted that Caterpillar, John Deere, and Detroit Diesel are the engine manufacturers AEA purchases engines from.  Those three engine makers have 90 percent of the market share and introducing new engine makers to rural Alaska is difficult, according to AEA.  Manufacturers have indicated to AEA that they cannot provide pre-Tier 4 engines and added they believe that there are no provisions in the rule allowing this type of flexibility.  EPA clarified that rural portions of Alaska may have special provisions in the final rule.  EPA also offered to provide AEA with control technology vendor contact information and also talk to vendors directly to obtain more information.  

	Regarding maintenance, AEA indicated that engine manufacturer John Deere claims that there is no way to maintain their filters in the field in rural Alaska.  AEA said that the information for mobile sources EPA used to develop the rule for stationary engines is not applicable for stationary engines in rural Alaska and indicated that this is one of their points of contention.  AEA said that the service intervals are much shorter on their stationary diesel engines because of higher run times and noted that a stationary diesel engine could run for 100,000 hours in prime service.  

	Regarding used oil blending, AEA stressed that this is an important provision for engines in rural locations of Alaska.  AEA explained that it understood that if the fuel is controlled to on-specification levels (Note:  On-specification levels and properties of used oil are defined in 40 CFR 279.11) the fuel is allowed to be burned in stationary diesel engines.  AEA noted that it had estimated that the used oil blending would have to occur at less than 1 percent in order to obtain a blended result of less than 15 parts per million (ppm) sulfur, and according to AEA, the used oil could sometimes be well above 200 ppm sulfur.  EPA asked why the used oil would have such high sulfur content. AEA responded that sulfur is a good lubricator and there are oils that had high sulfur levels for lubricity purposes.

	In terms of the benefits associated with regulating stationary diesel engines in rural areas, AEA argued whether it was necessary to do so because in a rural community the only diesel engines are at the power plant versus in an urban setting where there are numerous diesel engines.  AEA does not believe that the benefits outweigh the costs of compliance for rural diesel engines in Alaska.  For the reasons provided during this meeting and in additional information submitted to EPA, AEA believes there is justification for providing flexibility for rural sources in Alaska, specifically exempting stationary diesel engines from meeting Tier 4 emission standards.  	
	
