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RAP Model Rule

The U.S. DOE, through the National Renewable Energy Lab, has sponsored the development of a national model rule for regulation of emissions from distributed generation. The project was coordinated by the Regulatory Assistance Project (RAP) . The goal of the effort was to establish emission standards that could be applied uniformly across the country to ensure appropriate emission limits for DG technologies and to streamline the permitting process for those technologies. The group has developed a draft model rule which was released in late October of 2002. Once the model rule is completed, it will need to be adopted by individual states to become effective. This summary provides background on the process and summarizes the draft rule.

Background
The national model rule is being developed by a working group of state air and energy regulators along with a few industry and environmental group representatives. The model rule development effort started in January 2001 and has proceeded primarily through conference calls and emails.

There are two primary justifications for the rule. One is to set emission limits for DG sources that are currently not regulated or not effectively regulated. The increased use of diesel standby generators as peaking units is one of the primary concerns. The other justification is to streamline the permitting of DG units that meet the new limits and provide manufacturers with one uniform, national target. Coordinating these two goals has been difficult. Streamlining is really not an issue for the many small generators that currently are not regulated at all. On the other hand, jurisdictions with stringent and complex requirements will have a difficult time accepting a national standard that may be less stringent.

A related underlying tension in the development of the rule has been the debate between those who would like to set limits based on the output-based performance of large gas combined cycle units and those who believe that approach is not appropriate. The combined cycle levels of control cannot be achieved by most currently available technologies and are unlikely to be achievable in the foreseeable future.

Defining the applicability was another difficult issue. There is no clear definition of "distributed generation". The group considered factors including generating capacity, location, and emission and technology factors and eventually settled on including all sources that are not major emission sources. This means that the regulation would apply to much larger units of a clean technology than a higher emitting technology. This fits the streamlining goal. Since the major source threshold varies regionally, this means that the applicability will vary regionally. In attainment areas, the rule could include very large clean units, while in nonattainment areas it would apply only to much smaller units.

The Draft Rule
A draft model rule was released in late October of 2002. The rule applies to new, non-mobile electric generators that do not exceed the Federal new source review major source threshold in a given location. The rule would allow them to be automatically permitted if they meet the required emission levels and certain record-keeping requirements. Portable generators subject to the Federal non-road engine standards are not covered by this rule.

The primary focus of the rule is on certification of small generators. However, other generators that can show compliance would be eligible to use this rule even if they were not certified. This is important for larger size generators or special application technologies that are not likely to go through the certification process.

The model rule includes separate standards for emergency and non-emergency units. The limits are phased in over time. The initial phase begins in 2004. The second phase is 2008 - 2012. The third phase is 2012 and beyond. The phase-in is supposed to encourage the development and commercialization of new technologies.

The rule sets limits for NOx, CO, particulates and CO2, however the development discussion has focused mostly on NOx and CO2. The CO2 limits are intended to send the message that CO2 emissions are important, without necessarily creating compliance problems for existing technologies. Since most of the technologies are already gas-fired, there is little that can actually be done at this point to reduce CO2 emissions.

Emergency Generators
This category is limited to generators that run only during power outages and limited maintenance hours. The generator may run up to a maximum of 50 hours per year for maintenance and whenever there is a power emergency, with a total limit of 300 hours per year. Operation for peaking, load shaving or load response programs is not allowed under this category. The source must record the date and start/stop time for every operation as well as total annual run hours. Maintenance hours must be separately accounted for.

Emergency generators must meet the emissions standards set by the US EPA for non-road engines (40 CFR 89) at the time of installation. Any engine that is certified under the US EPA non-road standards is automatically certified under this rule to operate as an emergency generator. In addition, CO2 emissions standards for emergency generators are as follows:

Non-Emergency Generators
All stationary generators that cannot qualify as emergency generators and that are not subject to the Prevention of Significant Deterioration or New Source Review programs will be limited to the following:

PM limits for nonreciprocating engines are yet to be determined.

By December 31, 2010, the agency will complete a review of the Phase Three standards. Beginning in 2017 and every five years thereafter, the agency will review these standards and determine whether the emissions set out should be amended.

Dual-fuel generators must meet these requirements when operated on gaseous fuels and are limited to no more than thirty days per year of operation using liquid fuel.

Credit for Concurrent Emissions Reductions
If a generator uses fuel that would otherwise be flared, the emissions that would have been produced through the flaring can be deducted from the actual emissions of the generator, for the purposes of calculating compliance with the requirements of this rule. If the actual emissions from flaring cannot be documented, then the following default values shall be used:

Combined Heat and Power
To receive thermal output related emission credits, CHP installations must:

20% or more of the fuel’s total recovered energy must be thermal and at least 13% must be electric.

The design system efficiency must be at least 55%.

A CHP system can receive a compliance credit based on the emissions that would have been created by a conventional separate system. The credit will be subtracted from the actual generator emissions. The credit will be calculated according to the following assumptions and procedures:

Pollutant	Maximum emission rate (lbs/MMBtu)
NOx	0.3
CO	0.08
CO2	117

End-Use Efficiency and Non-Emitting Resources
When end-use energy efficiency, conservation measures or non-polluting electricity generation are installed and operated at the facility where the generator is installed and operated, then the electricity saved or produced by these technologies can be added to the electricity supplied by the generator for the purposes of calculating compliance with the requirements of this rule.