Guidelines For Obtaining Power Plant Permitting Under The Clean Air Act

When planning a new industrial power plant or expansion of an existing facility, permitting procedures mandated by the CAAA, as contained within the SIPs, must be considered.

By Mark L. Brecher March 1, 1998

When planning a new industrial power plant or expansion of an existing facility, permitting procedures mandated by the CAAA, as contained within the SIPs, must be considered. SIP requirements vary not only with abutting states, but also within the state’s boundaries, depending on whether a given air basin is in attainment or not and the pollutants contributing to nonattainment. (See the “Acronym dictionary” for definitions of acronyms used in this article.)

SIPs have some similarities, as dictated by the CAAA and accompanying federal regulations. In all cases, NAAQSs are reiterated, areas within the state found in nonattainment are listed, strategies for bringing areas into compliance are identified, and standards and permitting requirements for new and, in the case of operating permits, existing facilities are spelled out.

Local variations in the SIP may restrict the use of fuels within selected jurisdictions of the state to low sulfur residual, 0.5% No. 6 fuel oil, or distillate grades of oil and natural gas. Individual permitting thresholds and specific reporting requirements may vary, as long as federally mandated guidelines are met.

Permitting procedures

The process of obtaining necessary air emission permits to construct a new or expanded facility should begin as soon as the scale of the project is known. Early estimates of plant capacity and, based upon equipment manufacturers’ data, emissions of regulated pollutants should be tested against the thresholds contained in the SIP to determine application requirements.

Although experiences vary from state-to-state and with the size of the proposed facility, it is reasonable to allocate about 6 mo for permit approvals for simple small scale projects to a year or more for larger, more complicated facilities. Remember that most permits to construct new facilities have a time limit within which the work must commence.

Most states have specific guidelines, instructions, and forms for preparation of the necessary applications. Within this framework, it is necessary to provide specific supplemental information. Examples vary with application type, but minimally usually consist of the following data.

– Site plans and facility design documents in sufficient detail to establish location, scale, and relationships, horizontally and vertically, to and between proposed facilities and adjacent properties or existing onsite construction is required. Stack and building heights are established in these documents.

– Equipment manufacturers’ emissions data are a necessity. Usually this information is representative, since equipment sources may not be known during the application stage.

– Estimated load data — both peak and annual — should be calculated.

– Determine potential emissions by applying the above factors and assuming that all new or increased capacity operates at full rated load for 24 hr/day, 365 days/yr.

– Description of all existing systems to be modified or displaced by the new construction, including emissions information, is needed. These data provide the basis for determining whether a modification is to be classified as major or not, and will be necessary if the permit application seeks to include credits or offsets.

– Depending upon the scale and location of the project, a BACT analysis must be provided.

– AQIA is another common supporting document. There are degrees of complexity required for performing the required modeling depending again on project scale. Local and regional impact modeling considering the new facility alone or together with other local or regional sources are commonly required.

– Provide a description of any fuel use restrictions or fuel shifting proposed to reduce annual emissions.

– Develop a description of any emission offsets or credits being applied as a result of discontinued use of an existing emissions source, or as a result of upgrading obsolete equipment. Firm contracts or detailed engineering analysis must be provided to support any such claims of credits or offsets. Also, most regulations do not allow 1:1 swap. Offset or credit requirements can vary from 1.1:1 up to 1.2:1. For example 1.1 lb of NOx emissions saved from replacing an existing burner with a new low emissions burner provides you with the ability to add new equipment contributing 1 more lb of emissions.

Compliance and nonattainment

Of all provisions in the CAAA, those mandating PSD in areas in compliance and NSR in areas on nonattainment offer the greatest challenge. On the surface, it appears that no new major facilities can be constructed in areas of nonattainment. In reality, permitting such facilities is achievable if certain requirements are met. Similar challenges are present in areas presently in compliance, but whose air quality may degrade below NAAQS as a result of the proposed new facility.

PSD . If the proposed facility will be a major source, a determination must be made that the impact will not result in a lowering of air quality below NAAQS, or that air quality won’t degrade from baseline levels more than by an allowable amount referred to as the “PSD Increment.” A major source is a listed industry with the potential to emit 100 tpy of a regulated pollutant or any other source with the potential to discharge more than 250 tpy of a regulated pollutant.

Since the basis of the comparison is the potential to emit, fuel use restrictions and switching are very effective and an acceptable means of staying below the threshold that defines a major source, thus simplifying the permitting process.

If it is determined that the proposed project will result in a significant deterioration in air quality, the CAAA provides that the project not be permitted for construction unless emissions can be offset by reductions in discharges from preexisting sources. There are also provisions for purchasing of emission credits from preexisting facilities which have ceased operation or whose discharges have been greatly reduced.

NSR . NSR is required for all proposed major facilities or major modifications located in areas of nonattainment. Under the NSR provisions, LAER emissions are required. This provision is like BACT, but economics must be ignored in selecting the best control alternative. Under NSR, emission offsets or credits are mandatory to allow a facility to be permitted.

Clearly, the hurdles faced in areas of nonattainment are higher and more frequent than those placed in the path of permitting in areas of attainment. However, it is possible to clear them all with good planning and engineering.

Offsets and credits

Credits are usually limited to emissions from the same site or source being replaced or upgraded. However, credits generally are available from a broader category of sources within a given geographical area, in the case of ozone nonattainment, specifically. Offsets and credits must meet specific requirements.

Baseline . This figure is the actual emissions off the source from which the offsets will be obtained or the applicable emission limits as established under the regulations or, if more stringent, those contained in the SIP.

Emissions quality . Proposed offsets should be of the same quality, or have the same potential environmental or health impact. For example, an unacceptable offset would be reducing CO emissions while increasing NOx emission rates. It is mandated to provide like offsets, PM-10 for PM-10, etc.

Criteria pollutants . Only offsets of the same criteria pollutant are acceptable as long as the next requirement is met.

NSPS/NESHAPS . NSPS must be complied with for all emissions, and NESHAPS must be followed for criteria pollutants.

BACT/LAER . The BACT test must be applied to the proposed new source or, in the case of HAPs, LAER applies.

Hydrocarbons . One hydrocarbon cannot be substituted for another as an offset.

Particulates/SO(sub 2) Effective stack height of the new source must be no greater than the one being offset.

VOC . Summer increases in VOC will not be permitted, if offset by winter reductions.

Offsets and credits must be verifiable. Reporting requirements include periodic stack emissions data and annual fuel usage based upon a rolling 12-mo period, and may include continuous stack emission monitoring.


As time passes, obsolete or underutilized systems are abandoned, replaced, or downsized. Emissions from these facilities can, under the regulations, be placed in a “bank” for future withdrawal. This area is still not fully realized or defined. Most SIPs only recognize credits from within that state’s political boundaries.

If a plant intends to pursue an emissions bank as a source of credits to be applied toward a new facility, it is important to have a clear agreement from the regulatory agency responsible for the application to construct your facility that the source is acceptable. It is also important to have a long-term renewable agreement guaranteeing the availability of the credit over the projected life of the facility.

Operating permits

The CAAA not only defines the requirements for permitting to build new facilities, but also requires the permitting of many existing and newly completed facilities. These operating permits are often referred to as Title V permits. Title V (of the 1990 CAAA) permitting is required for all facilities with major emissions and was intended to provide a data base for monitoring and enforcement.

Title V operating permit applications will require as a minimum:

– Fees paid to the state for plan administration

– Means of reporting air emissions either by CEM or fuel usage supported by periodic stack testing

– Onsite recordkeeping of relevant data

– Certification of compliance with applicable emission limitations.

Final look

The CAAA utilizes a program of permitting as a tool to achieving NAAQS. It assumes regulatory responsibility over all potential sources of air pollution and provides a framework for state implementation and enforcement.

For the most part, the CAAA as it relates to fossil fuel burning facilities focuses on new or expanded facilities. However, existing plants are subject to its provisions. The recent NOx RACT plant modifications were derived from mandated reductions in such emissions in an effort to achieve NAAQS.

— Edited by Ron Holzhauer, Managing Editor, 847-390-2668,

Key concepts

Act provides a baseline for clean air, mandatory compliance regulations, and procedures for implementation and enforcement.

Detailed and numerous state guidelines, instructions, and forms are part of the application package.

Contaminant threshold requirements depend on whether the area is in attainment or nonattainment.

Acronym dictionary

AQIA — Air quality impact analysis

BACT — Best available control technology

CAAA — Clean Air Act as amended

CEM — Continuous emissions monitoring

HAP — Hazardous air pollutant

HHRR — High heat release rate

LAER — Lowest achievable emission rate

LHRR — Low heat release rate

PSD — Prevention of significant deterioration

NAAQS — National ambient air quality standards

NESHAPS — National emissions standards for hazardous air pollutants

NSPS — New source performance standards

NSR — Nonattainment area new source review

RACT — Reasonably available control technology

SIP — State implementation plan

CAAA Provisions

1. Establishes a baseline for clean air by creating NAAQS. These standards state the maximum allowable level of air pollutants within the various categories of compounds that can be found in the air at a given location and duration. Meeting or exceeding these standards defines whether a region is in attainment or nonattainment.

2. Establishes mandatory compliance regulations over those emissions sources or types which have a history of federal regulation or are a matter of international treaty. Specifically, the CAAA addresses mobile sources, hazardous air pollutants, acid deposition control (acid rain), and stratospheric ozone depletion. It is this provision which endeavors to control acid deposition by restricting the use of high-sulfur fuels, mostly coal, or requiring stringent emission controls. This provision codified and established the enforcement mechanism required by the “Acid Rain” Treaty with Canada. Stratospheric ozone depletion provisions provide the basis for curtailing the manufacture and use of ozone depleting chemicals. The greatest impact has been the switching of refrigerants from CFC to more ozone-friendly products.

3. Establishes procedures for implementation and enforcement by defining the requirements to be included in SIPs. SIP defines local emissions standards, permitting requirements, and other procedures for reaching and maintaining local air quality within the limits imposed by the NAAQS.

4. Offers some novel approaches to dealing with the regional issues of air pollution. Emission offsets and credit banking are examples of these.

5. Addresses issues of research, economic impact, and miscellaneous other administrative and reporting functions.


CAAA and its associated regulations define standards for new sources of air emissions. The standards vary with heat input, fuel source, and whether or not the source is an electric power generating utility. As a minimum, all new fossil fuel burning boilers must have emissions at or below these thresholds. States may impose even more stringent requirements under their SIPs to meet NAAQS. As originally stated, emission standards were in terms of either a percentage reduction from potential to emit or an absolute limit. Some confusion resulted from the original wording. Presently NSPS regulations are being redrafted with the intent of clarifying and making the imposed limits more specific. The following standards applied under the regulations in effect at the time this article was written.

– Industrial steam generating equipment with less than 10 million Btuh input are not regulated under the NSPS.

– Industrial steam generating equipment with a heat input from 10 to 100 million Btuh have imposed emissions standards of 0.50 lb/million Btu for SO(sub 2) and 20% opacity for fuel oils.

– For equipment with heat inputs from 100 to 250 million Btuh, the standards for SO(sub 2) and particulate emissions are unchanged. However, standards for NOx are now imposed. For LHRR equipment, standard for natural gas and distillate fuel oil is 0.1 lb/million Btu and for HHRR equipment the number is 0.2 lb/million Btu. For residual oil, the LHRR equipment figure is 0.3 lb/million Btu and HHRR equipment is 0.4 lb/million Btu.

– For equipment with heat inputs over 250 million Btuh, SO(sub 2) and particulate emission standards become broader and more restrictive. SO(sub 2) is restricted to 10% of the potential to emit for all but very low sulfur fuel oils, which are excused from this standard. Particulate emissions are restricted to 0.1 lb/million Btu. Standards for NOx remain unchanged.


This document is essentially an economic impact analysis of various technologies available to limit the emissions of regulated pollutants. First and maintenance costs and operating expenses can be taken into account when comparing options against a baseline system. SIP guidelines are not often hard and fast when it comes to what is the minimum cost (usually expressed in dollars/ton of emissions reduced) that must be incurred in order to meet the BACT test. The BACT analysis must accomplish three conditions.

1. Establish a baseline facility by describing its principal components, fuels, capacity, and potential to emit based on actual emission rates or by assuming that no controls are applied beyond those specifically mandated or required to achieve specific emission limits on a unit basis, usually expressed in lb/million Btus input or ppm of emissions output. Data should also include heat release rates which define the allowable NOx generation rates under some SIPs. Under CAAA and SIP requirements, the baseline must be in compliance with mandated restrictions, as defined in the NSPS.

2. Define a series of BACT alternatives to be considered. These possibilities may include fuel shifting, including relying on natural gas when it is available. Under the regulations, interruptible service can be considered as long as there is a very conservative estimate made of the time and portion of the total annual load that cannot be served with natural gas. Quasi-firm or 10-mo contracts are generally more accepted by regulators when considering the annual contribution of a new facility. It is important to remember that the commitment to fuel shifting or any other BACT must last the life of the facility. If changes are necessary, such as the need to reduce the use of natural gas, a new permit filing must be made. Hardware upgrades include high performance, low emission burners or the introduction of emissions’ polishing equipment such as multiclone particulate separators and wet or dry scrubbers. Installation of advanced new technologies such as selective and nonselective catalytic reduction technologies are another option.

3. The BACT analysis provides a comparative economic look at the alternatives with the results expressed in dollars/ton of emission reductions compared to the minimum acceptable baseline. Factors usually included are first cost, including engineering fees, prorated over the life of the facility; cost of capitalization (interest); additional energy costs due to loss of efficiency; power required to operate the control technology, such as electricity for dry scrubbers or for additional fan horsepower; chemical use such as ammonia in SCR; and documentable additional maintenance costs.


All efforts should be made to develop processes and systems that minimize the reliance on fossil fuels, yet remain economical. Each SIP contains specific plant and equipment size thresholds which trigger more extensive permitting requirements. Under the provisions of the CAAA, various threshold levels are defined for nonattainment and attainment areas.

Nonattainment areas

1. A major source is generally one with the potential to emit a regulated pollutant in quantities which will exceed a preset threshold. Regulated pollutants are carbon monoxide, lead, nitrous oxides, ozone, particulate matter, and sulfur dioxide. In different ozone attainment areas, the threshold can vary from 100 tpy to as little as 10 tpy. For HAPs regulated by the EPA, the threshold is 10 tpy of a single HAP or 25 tpy of multiple HAPs in combination.

2. A major modification at an existing major source is one which would result in a significant new emissions increase of any regulated pollutant of 100 tpy CO, 40 tpy NOx, 40 tpy SO(sub 2), 40 tpy ozone (measured as VOC), or 0.6 tpy lead. Lower limits are common under individual SIPs.

3. New facilities are subject to emission limits established for each of several industrial categories under the NSPS provisions of the CAAA. It is very important to remember that these limitations are for the entire complex and not just the power plant.

Attainment areas

1. All proposed facilities with major emission levels are subject to review to determine if they will result in a deterioration in local air quality to below that defined by the NAAQS. The most significant variations from the regulations applicable to areas of nonattainment are those defining a major source. A major source is a listed industry with the potential to emit 100 tpy or more of any regulated pollutant, or any other stationary source with the potential to emit 250 tpy or more of any regulated pollutant.

2. A major modification is defined as any physical change or method of operation change at an existing major stationary source that results in a significant net emissions increase of a regulated pollutant. Staying below these thresholds by limiting the size of the power plant means less stringent controls on emissions and less first cost, and can make the difference in successfully permitting the facility for construction. Therefore, process energy efficiency should be of paramount concern.

More info

The author is willing to answer technical questions concerning this article. Mr. Brecher is available at 617-423-7423; mbrecher@hvac.vander