E C/R Incorporated	          Providing Environmental Technical Support
Since 1989



	

MEMORANDUM  SEQ CHAPTER \h \r 1    

TO:		Melanie King, EPA OAQPS/SPPD/ESG

FROM:	Tanya Parise, EC/R, Inc.

SUBJECT:	Summary of the September 3, 2010 Teleconference with Exterran
Regarding the Proposed Amendments to the NSPS for Stationary Engines

INTRODUCTION

Exterran requested this teleconference with EPA to discuss the proposed
amendments to the new source performance standards (NSPS) for stationary
engines, specifically issues related to the definition of reconstruction
and the date of manufacture.  The proposed NSPS amendments were
published in the Federal Register on June 8, 2010 (75 FR 32612).  

ATTENDEES

Melanie King, EPA	Gerald Meinecke, Exterran

Michael Horowitz, EPA	Mike Wasson, Exterran

Alan Stout, EPA	Bill Bowes, Exterran

Tanya Parise, EC/R Inc.	James Harrison, Exterran

Jeff Holmstead, Bracewell & Giuliani	Kyle Jantzen, Exterran

Rebecca Rentz, Bracewell & Giuliani

	

SUMMARY OF TELECONFERENCE

	Exterran indicated that it had concerns with certain provisions in the
proposed amendments to NSPS for stationary engines.  Exterran’s main
issue with the proposed amendments was the addition of the definitions
of “reconstruct” and “date of manufacture.”

In terms of the reconstruction provisions, Exterran noted that the
proposal represents a departure from other 40 CFR part 60 regulations
and expressed particular concern with triggering NSPS with the 75
percent capital cost threshold.  Exterran asked what EPA’s intentions
are with the proposed amendments.  EPA indicated that the proposed
amendments are not entirely different from other regulations; in fact,
something similar is being done with reconstruction of combustion
turbines.  EPA indicated that the purpose of the proposed amendments was
to minimize attempts to circumvent the requirements where an engine
should be regulated as a new engine.  Also, EPA indicated that the
language with respect to reconstructing, rebuilding, or refurbishing an
engine previously made it seem as if only owners and operators would be
subject to the requirements.  EPA intended to clarify that with the
proposed amended language and to generally minimize relying on the
language in the General Provisions by being more specific in the
proposed amendments.  EPA indicated that it is open to ideas from
industry and would like information on how the proposed amendments could
cause problems for owners and operators.  

In Exterran’s opinion, EPA needs to look at the additional costs
associated with reconstructing an engine and not only consider the costs
directly associated with the engine itself.  For example, engineering,
installation and other equipment costs need to be included in
determining a “comparable new facility.”  According to Exterran,
stationary engines are regularly updated and during an overhaul the
engine is unbolted from the support system and dropped back into place
after the necessary components (exhaust system, cooling system, inlet
air system, etc.) have been inspected and replaced, as necessary.  To
find a new engine to fit in the same location having the same design,
would be difficult, e.g., the mounting arrangement could change, and
according to Exterran, a new engine could not just be “dropped-in”
with the existing auxiliary system.  Such replacement would at least
have to be re-evaluated and Exterran asked that EPA look at and allow
the use of other costs as well like the install and engineering costs
that would occur during such a determination.  EPA indicated that it
would consider Exterran’s comments and discuss this issue with the
Office of Enforcement and Compliance Assurance.  EPA indicated that it
was not intending on changing the definition of “fixed capital
costs” in 40 CFR 60.15(c).  

Exterran indicated that the nitrogen oxides (NOx) emissions from
4-stroke lean burn engines (4SLB) are less than 3 grams per
horsepower-hour (g/HP-hr).  According to Exterran, 4SLB engines can
easily meet the first tier of standards in the spark ignited NSPS. 
However, Exterran believed that it would not make sense to control 4SLB
engines to 1 g/HP-hr of NOx if these engines received a new date of
manufacture and subsequently would be subject to the second tier of
standards.  In Exterran’s opinion, this would be getting rid of an
efficient engine and this does not seem to be EPA’s intent.  Exterran
recommended that if a source meets the 75 percent reconstruction
criteria, the engine should be subject to the standards applicable to
reconstructed engines, not the standards applicable to new engines.

Where EPA proposed to add the definition of “date of manufacture” to
40 CFR §§60.4219 and 60.4248, Exterran disagrees that the removal of
the crankshaft during reconstruction should a determining factor. 
According to Exterran, the crankshaft is removed with every maintenance
event and the removal of this part does not seem to fit with EPA’s
intent.  EPA indicated that it would look at this issue.  Exterran
indicated that it would provide additional and more extensive discussion
and rationale supporting its position in the comments that it intends on
submitting to EPA on the proposed rule amendments.

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