November 14, 1995





MEMORANDUM

SUBJECT:  Calculating Potential to Emit (PTE) and Other Guidance
          for Grain Handling Facilities                        

FROM:     John S. Seitz, Director
          Office of Air Quality Planning and Standards (MD-10)

TO:       Director, Office of Ecosystem Protection, Region I 
          Director, Air and Waste Management Division, Region II
          Director, Air, Radiation, and Toxics Division, 
            Region III
          Director, Air, Pesticides, and Toxics Management
            Division, Region IV
          Director, Air and Radiation Division, Region V 
          Director, Multimedia Planning and Permitting Division,
            Region VI
          Director, Air, RCRA, and TSCA Division, Region VII
          Assistant Regional Administrator, Office of Pollution
            Prevention, State and Tribal Assistance, Region VIII
          Director, Air and Toxics Division, Region IX 
          Director, Office of Air, Region X 


     The purpose of this guidance is to address the determination
of PTE for grain elevators and other issues for grain handling
facilities.

Background

     In a memorandum dated January 25, 1995, the Environmental
Protection Agency (EPA) addressed a number of issues related to
the determination of a source's PTE under section 112 and title V
of the Clean Air Act (Act).  [Memorandum from John Seitz to EPA
Air Directors entitled  Options for Limiting the Potential to
Emit (PTE) of a Stationary Source Under Section 112 and Title V
of the Clean Air Act,  hereinafter referred to as the  January 25
memorandum ].  One of the issues discussed in the memorandum was
the term "maximum capacity of a stationary source to emit under
its physical and operational design," which is part of the
definition of "potential to emit."  The memorandum clarified that
inherent physical limitations and operational design features
which restrict the potential emissions of individual emission
units, should be taken into account.  This clarification was
intended to address facilities for which the theoretical use of
equipment is much higher than could ever actually occur in
practice.  For such facilities, if their physical limitations or
operational design features are not taken into account, the
potential emissions could be overestimated and the source owner
could be subject to the Act requirements affecting major sources. 
Although such source owners could accept enforceable limitations
restricting the operation to its designed level, the EPA believes
this administrative requirement to be unnecessary and burdensome. 
    

     On the topic of "physical and operational design," the
January 25 memorandum provided a general discussion.  In
addition, the EPA committed to providing technical assistance on
the type of inherent physical and operational design features
that may be considered acceptable in determining the potential to
emit for certain individual small source categories.  The EPA is
currently conducting category-specific analyses in support of
this effort, and hopes as a result of these analyses to generate
more general guidance on this issue as well.  The purpose of this
memorandum is to address the issue as it relates specifically to 
grain elevators, and to provide EPA guidance on other issues
related to grain handling facilities.

     The policies set forth in this memorandum represent official
EPA guidance on this issue and are intended to provide guidance
to State regulators on methods that the EPA believes are
appropriate for sources whose potential emissions are, as a
practical matter, restricted by inherent operational limitations.
The policies set forth in this memorandum are intended solely as
guidance, do not represent final Agency action, and cannot be
relied upon to create any rights enforceable by any party.

     In addition to today s guidance, there are two additional
recent EPA activities that relate to emission calculations for
grain elevators and other grain handling facilities.  First, the
EPA recently issued a policy memorandum entitled  Definition of
Regulated Pollutant for Particulate Matter for Purposes of  
Title V,  (Lydia Wegman to Regional Offices, October 16, 1995.) 
In this memorandum, the EPA recognizes PM-10 as the only
regulated form of particulate matter for purposes of determining
applicability to title V major source requirements.  Second, the
EPA is issuing revised emission calculation methods (interim
update to AP-42, section 9.9.1,  Grain Elevators and Processes ) 
The combined result of the October 16 memorandum and the revised
emission calculation methods is a substantial reduction in the
particulate emission estimates from a given grain elevator and
grain handling facilities.     


Guidance for Grain Elevators   

     For purposes of today's guidance, a "country grain elevator"
means any grain elevator that receives more than 50 percent of
its grain from farmers in the immediate vicinity during the
harvest season, and a grain terminal is an elevator that receives
grain primarily from other elevators.  

     Grain elevators emit particulate matter, including PM-10,
during the receiving, handling, and shipping of grain.  The rate
of particulate matter emitted is directly proportional to the
amount of grain handled by the elevators.  

     The EPA recognizes that country grain elevators are clearly
constrained in their operation, to the extent that they are
designed to service, and as a matter of operation only service, a
limited geographic area from which a finite amount of grain can
be grown and harvested.  Moreover, the principal determinant of
which given elevator will be used by a farmer is the proximity of
the elevator to the harvest.  Consequently, a single elevator
services essentially the same geographic area from year to year. 
The EPA believes that this constraint is "inherent" to the
operation of the elevator (i.e., operation of the grain elevator
is directly linked to a specific and definable harvest area). 
The grain handling and storage facilities at grain elevators are
designed to handle very large amounts of grain in a relatively
short period of time (i.e., at harvest).  Although the physical
capability exists to handle large amounts of grain throughout the
year, such a year-round operation is clearly unachievable as a
practical matter and does not occur in reality.  Although the
amount of grain harvested during any 1 year will vary somewhat,
the EPA believes that an estimable and reasonable upper bound can
be determined which would never be exceeded absent extraordinary
circumstances.      

     For existing country grain elevators, the EPA has determined
that a reasonable and realistic "upper-limit" estimate of the
number of bushels of grain projected to be delivered to the
elevator may be considered in identifying the "maximum capacity"
of such elevators for the purpose of estimating their PTE. 
Consequently, the EPA does not recommend basing the potential to
emit calculation for existing country grain elevators on a
throughput estimate based upon year-round operation of the
elevator at its maximum rate of operation.

     Instead, the EPA recommends that the PTE be determined based
upon a more realistic estimate of the maximum amount of grain
that could be received during a record crop year in the
geographic area served by the elevator.  The EPA believes that
the highest amount of grain received during the previous 5 years,
multiplied times an adjustment factor of 1.2, will constitute a
realistic upper bound on the amount of grain a country elevator
could receive.  The adjustment factor of 1.2 is designed to take
into account additional considerations that might affect the
maximum harvest including:  (1) the possibility that the number
of acres harvested in the local area could increase, (for
example, if an increased percentage of acres in the growing
region became available for planting because of changes in
government policy); and (2) increases in crop yields.

     The EPA expects that there may be rare cases where the
future grain receipts in a given year could exceed the 1.2 times
the historical production figure.  Where this is the case, the
maximum receipt estimate should be recalculated.  

     Example:  The maximum amount of grain received during the
     previous 5 years for a given elevator is 2 million bushels. 
     Consequently, the estimate of maximum receipt, to be used
     for purposes of determining the facility s potential to
     emit, is 2 x 1.2, or 2.4 million bushels.  In some future
     year, 2.6 million bushels are received.  At this point, the
     maximum receipt estimate becomes 2.6 x 1.2, or 3.1 million
     bushels.   

     The EPA believes that this guidance, in combination with the
previously mentioned updates to emission calculation methods,
will result in few, if any, country grain elevators exceeding the
major source threshold for PM-10.


Permitting of Nonmajor Sources

     In response to recent questions, the EPA wishes to clarify
the requirements of the title V program for nonmajor source grain
elevators subject to section 111 or 112 standards.  This issue is
addressed in 40 CFR part 70, paragraph 70.3(b)(1), which allows
States to exempt nonmajor sources from title V permitting until
such time as the EPA completes a rulemaking to determine how the
program should be structured in the future for nonmajor sources.

     For grain elevators over a certain size, there is an
existing new source performance standard (i.e., a section 111
standard) that was promulgated during the late 1970s.  This same
standard also applies to additional agriculturally-related
facilities such as flour mills, corn mills (human consumption),
and rice mills.  Some sources covered by this standard may have
potential emissions less than the major source threshold.  For
these nonmajor sources, as indicated in section 70.3(b)(1), the
EPA has granted a temporary exemption from title V permitting. 
As noted, this temporary exemption from title V permitting is set
to expire when the EPA completes a further rulemaking addressing
permitting of nonmajor sources.  However, it is the EPA s intent
that this rulemaking or a separate rulemaking will establish a
permanent exemption for grain elevators, feed mills, and other
grain handling facilities that are nonmajor sources.  

     There are currently no applicable section 112 standards for
the grain and feed industry.  As indicated by paragraph
70.2(b)(2), the EPA will, for any future section 111 or 112
standards that may apply, determine whether to exempt any or all
nonmajor sources from the requirement to obtain a title V permit
at the time the standard is promulgated.  

Facilities with Low Actual Emissions

     The EPA also believes it useful to reiterate its policy
guidance with respect to sources with low annual rates of actual
emissions.  In the January 25 memorandum, the EPA announced a 2-
year transition policy for plant sites emitting less than 50
percent of the major source threshold.  Under this transition
policy, sources emitting less than this amount, and keeping
adequate records, are not required to be treated by States as
major sources for purposes of determining applicability of title
V and section 112 requirements.  The transition period in the
memorandum expires in January 1997.  

     The EPA intends to promulgate rulemaking amendments that
would extend permanent relief to low-emitting sources, excluding
such sources from being classified as  major sources  for
purposes of title V permitting.  (The exact cutoff for what
constitutes a low-emitting source would be determined in the
rulemaking process).  Such amendments are scheduled for
completion before the end of the 2-year transition period.  (If
the amendments are not promulgated by January 1997, the
transition period will be extended for the facilities addressed
in this document until the above-mentioned amendments are
finalized). 

     The EPA believes that these provisions for low-emitting
sources will ease the regulatory burden for grain elevators, feed
mills, and other agriculturally-related facilities.  Using the
recently adopted (November 1995) interim emission factors for PM-
10, even on an uncontrolled basis, the EPA has determined that
grain elevators with an actual throughput less than the values
listed in Attachment 1 will not exceed 50 percent of the major
source threshold. So long as adequate records of annual
throughput are kept, sources handling less than those levels are
considered by the EPA to be emitting less than the 50 percent
cutoff and can be exempted from title V.  Because these
facilities are often well controlled, many grain terminals with
greater throughputs will not be subject to title V permitting. 
In addition, preliminary calculations indicate that only the
largest of feed mills are likely to exceed this cutoff.           
     


Consideration of Control Measures

     The effect of control devices and measures in grain handling
facilities can be taken into account in determining whether a
source can be considered a  low-emitting source  as described
above, so long as adequate records are kept documenting the
proper operation and maintenance of the control devices and
measures. 

     The EPA and the grain industry are working to develop
estimates of the effectiveness of oil addition as a control
measure.  The results of this effort should be available by later
this year or early next year.  Interim guidance on the
effectiveness of oil addition is available in the above-described
revisions to section 9.9.1 of AP-42.  Consistent with the
provisions affecting other types of control devices or measures,
the effectiveness of oil addition can be taken into account in
determining whether actual emissions are below the cutoff for
 low-emitting  facilities as described above.  

     For sources whose actual emissions exceed the cutoff
described above, consistent with the EPA s general PTE policy,
the effect of control measures (including oil addition) can be
taken into account where those control devices and measures are
subject to enforceable limits or are inherent to the operation of
the facility. [Control measures that are  inherent  are those
which are always being operated and maintained for reasons other
than community air quality protection.  Examples of inherent
control measures would include (a) product collection devices for
which the value of the product collected greatly exceeds the cost
of the collection device, and (b) devices for which the primary
purpose is to improve product quality control, to recover
product, or to enhance production operating efficiency (for
example, product recovery cyclones associated with operations
such as pellet cooling at feed mills).]

     There are a number of grain elevators that have  closed
loop  systems in which conveyors are completely enclosed
essentially from the grain unloading point to the point at which
grain is deposited to the bin.  Where this is the case, some
agencies (for example, the State of Michigan) have made
adjustments in the emission estimate to take this into account. 
The EPA agrees that such adjustments are appropriate,
particularly in estimating emissions from the  headhouse  or
 internal  portions of the emission factors.  Further, in the
case of feed mills, there are certain operations which can be
totally enclosed.  Where this is the case, the emission
calculations should take this into account.

Cautions

     This guidance is not intended to replace the establishment
of operational limitations in permits to construct or operate
when such limitations are deemed appropriate or necessary, such
as the establishment of PTE limits in a minor source
preconstruction permit for sources not yet in operation.  (For
such sources, there may not be a historical data base on crop
production).  Additionally, this memorandum is not intended to be
used as the basis to rescind any such restrictions already in
place.

     This guidance should not be interpreted as having any effect
on whether new source performance standards apply to a given
elevator.  The guidance is not intended to prevent any control
agency from imposing requirements designed to provide for
attainment of the national ambient air quality standards.        

Distribution/Further Information

     The Regional Offices should send this memorandum to States
within their jurisdiction.  Questions concerning specific issues
and cases should be directed to the appropriate Regional Office. 
Regional Office staff may contact Tim Smith of the Integrated
Implementation Group at 919-541-4718.  The document is also
available on the technology transfer network (TTN) bulletin
board, under "Clean Air Act, Title V, Policy Guidance Memos."
(Readers unfamiliar with this bulletin board may obtain access by
calling the TTN help line at 919-541-5384).

Attachment

cc:  Chief, Air Branch, Regions I-X

Grain Throughput associated with Uncontrolled PM-10 emissions 
of 50 tons/yr





Type of
shipping/receiving
Grain
Total throughput
(bushels)


Truck or rail
receiving/truck or
rail shipping
Wheat
Corn/soybeans
Milo (sorghum)
32 million
14 million
20 million


Truck or rail
receiving/barge
shipping
Wheat
Corn/soybeans
Milo (sorghum)
24 million
10 million
15 million


Barge receiving/ship
shipping
Wheat
Corn/soybeans
Milo (sorghum)
10 million
4.0 million
6.1 million


Truck or rail
receiving/ship
shipping
Wheat
Corn/soybeans
Milo (sorghum)
17 million
7.1 million
10 million


     
Notes:

     1.  This table indicates, based upon the EPA s recommended
interim emission factors, the throughput associated with 50 tons
per year of uncontrolled PM-10 emissions, which is 50 percent of
the major source threshold for PM-10.  (For a small number of
geographic locations designated as serious PM-10 nonattainment
areas, the major source threshold is 70 tons per year.  For any
elevators located in such areas, the above number should be
multiplied times 0.7).  

     2.  The estimates take into account: (a) receiving, (b)
internal grain handling emissions, (c) bin vents, and (d)
shipping.   These are the sources that are generally present at a
given terminal.  If there are other significant sources of PM-10
at a given terminal, these would need to be considered.

     3.  Calculations assume density of wheat = 60 lb/bushel. 
Density of corn, soybeans, milo (sorghum) = 56 lb/bushel.