ARCHIVED REPORTS LEC APPLICATION FOR CERTIFICATION

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Attachment 5.1 F-1 Interpollutant Offset Analysis The objective of an emission offset requirement is to ensure that new projects will have a net air quality benefit in the region. The offset program seeks to achieve this by reducing emissions at one location to balance,or offset, an emission increase elsewhere. The simplest case involves the generation of emission offsets by reductions from an existing source at,or near,the new source. When the pollutants are the same and the location is the same,the presence or absence of a net air quality benefit is relatively easy to determine: if the new emissions are less than the old emissions, a regional net air quality benefit is achieved. When the location of the source of offsets is different from the source of new emissions, the areas impacted by the two sources differ. It is often impossible to demonstrate that the area impacted by the new source is benefited everywhere by the reductions from the existing source. Agencies usually address this by setting an offset ratio that takes distance into account. The amount of reductions required is higher than the emission increase,resulting in a net benefit to the region as a whole and to most locations in the impacted area as well. This approach is usually coupled with a requirement to conduct an impact analysis to ensure that no significant increases occur in those areas where the effect of the increase is greater than the benefit from the decrease. The analysis becomes much more complicated when the proposed reduction is of a different pollutant than that emitted by the proposed new source. The principle is the same: a net air quality benefit must be demonstrated. However,when the offsetting pollutant is different than the new pollutant,the demonstration is not straightforward. Although the statutory requirement is to show an overall net air quality benefit,the practice has been to apply this test on a pollutant-specific basis. The agencies have allowed the reduction of one pollutant to offset the increase of another pollutant only where the two pollutants can be related, generally because one pollutant is a precursor for the other,or both are precursors for a third pollutant. The SJVAPCD is not in attainment with the state 24-hour standard for PMlo. The District's new source review rule requires offsets for most increases in emissions of PMlo and its precursors,which include NOx,SO2,VOC, and PMlo. The applicant will be required to provide offsets for these pollutants. NCPA has purchased NOx,SO2,VOC, and PMlo offsets. However,the applicant has not been able to obtain sufficient PMlo offsets available to fully offset project PMlo with PMlo reductions. SJVAPCD allows the use of interpollutant offsets,provided the project demonstrates a net air quality benefit and the impact analysis demonstrates that the project does not worsen or cause non-compliance with any ambient air quality standard. LEC proposes to meet the PMlo offset requirements through provision of both direct PMlo and interpollutant SO2 reductions. The impact analysis requirement was addressed in Section 5.1.2.5. This analysis provides a technical basis for determining that the proposed offset ratio for SO2 to PMlo is sufficient to demonstrate a net air quality benefit.