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Home My WebLink About07. Consider agreement with Montrose Air Quality Services for air emissions testing services Page 1 of 4 Item 7. CENTRAL SAN CENTRAL SAN BOARD OF DIRECTORS POSITION PAPER MEETING DATE: SEPTEMBER 6, 2018 SUBJECT: CONSIDER AUTHORIZING THE GENERAL MANAGER TO EXECUTE TECHNICAL CONSULTING SERVICES AGREEMENT WITH MONTROSE AIR QUALITY SERVICES, LLC FOR AN AMOUNT NOT TO EXCEED $220,000 TO PROVIDE AIR EMISSIONS TESTING SERVICES FOR MULTIPLE HEARTH FURNACES, COGENERATION, AND AUXILIARY BOILERS THROUGH JUNE 30, 2019 SUBMITTED BY: INITIATING DEPARTMENT: RANDYSCHMIDT, SENIOR ENGINEER ENGINEERING AND TECHNICAL SERVICES- ERC-REGULATORY COMPLIANCE REVIEWED BY: LORI SCHECTEL, ENVIRONMENTAL & REGULATORY COMPLIANCE DIVISION MANAGER JEAN-MARC PETIT, DIRECTOR OF ENGINEERINGAND TECHNICAL SERVICES Roger S. Bailey Kenton L. Alm General Manager District Counsel ISSUE Board authorization is required to execute an agreement in an amount greater than $100,000 to perform air emissions testing through the end of Fiscal Year(FY) 2018-19. September 6, 2018 Regular Board Meeting Agenda Packet- Page 103 of 135 Page 2 of 4 BACKGROUND The proposed agreement would provide air emissions testing services to meet the following objectives related to regulatory compliance: 1. Annual Title V Auxiliary Boilers Compliance Emissions Test (Scheduled to start September 2018) • The Bay Area Air Quality Management District (BAAQMD) Permit-to-Operate requires an annual emissions test of nitrogen oxides, carbon monoxide (CO), non-methane organic compounds, and sulfur dioxide to demonstrate compliance with the annual Title V testing requirements and emissions limits. 2. Annual Title V Cogeneration Emissions Test (Scheduled to start September 2018) • The BAAQMD Permit-to-Operate requires an annual source test of CO emissions from Cogeneration to demonstrate compliance with the annual Title V testing requirements and emissions limit. 3. Hydrogen Chloride (HCI) Engineering Evaluation and Compliance Emissions Testing on Multiple Hearth Furnace (MHF) No. 2 (Scheduled to start September 2018) • In May 2018, the average HCI emissions measured on MHF No. 2 exhaust during the annual Clean Air Act (CAA) Section 129 compliance emissions test exceeded the applicable 1.2 parts per million by volume, dry (ppmvd) at 7% oxygen limit. BAAQMD staff has been notified of the HCI exceedance, and a Notice of Violation is anticipated from BAAQMD enforcement staff. BAAQMD indicated that a HCI compliance emissions re-test on MHF No. 2 may be required in the near future. To minimize the risks associated with another HCI emissions violation, the Central San Regulatory Compliance staff recommends conducting an engineering evaluation HCI emissions test followed by the HCI compliance emissions re-test on MHF No. 2. The HCI engineering evaluation would involve working with Operations staff to optimize the injection of sodium hydroxide (caustic) into the wet scrubber to ensure efficient acid gas removal and establish a target caustic injection dosage rate for the HCI compliance emissions re-test. 4. New Oxygen Monitor Certification on MHF No. 2 (Scheduled to start September 2018) • A new oxygen monitor was recently installed on the second hearth on MHF No. 2 next to the existing oxygen monitor. The new oxygen monitor is a more robust analyzer and requires less maintenance. The Title V Major Facility Review Permit requires a continuous measurement of the oxygen concentration in the combustion process and establishes a reporting limit of 10% on the oxygen concentration. Since this oxygen monitor will serve as a continuous emissions monitor for compliance determination, BAAQMD requires the completion of a Relative Accuracy Test Audit to certify the accuracy of the new oxygen monitor before it is used to demonstrate compliance. 5. Annual CAA Section 129 and Title V MHF No.1 Compliance Emissions Test (Tentatively scheduled to start in February 2019) • MHF No. 1 is anticipated to begin its annual operation in early 2019. CAA Section 129 requires an annual compliance emissions test on the operating MHF within 60 days of start-up for the following parameters: CO, nitrogen oxides, sulfur dioxide, total particulate matter, HCI, dioxins/furans, mercury, cadmium, and lead. Additionally, the Title V Major Facility Review Permit requires the annual testing of non-methane organic compounds and sulfur dioxide emissions on the operating MHF. September 6, 2018 Regular Board Meeting Agenda Packet- Page 104 of 135 Page 3 of 4 6. Contingency Emissions Tests • Due to increasing regulatory requirements and recent air-related violations, Regulatory Compliance staff recommends the inclusion of a contingency amount of$83,000 to cover any unanticipated air emission testing services that may be needed to demonstrate compliance, mitigate a potential compliance issue, and/or prepare for upcoming regulatory requirements. Potential items to be covered by this contingency air emissions testing item include: - Measurement of air pollutants for the development of site-specific emissions factors to improve the accuracy of the treatment plant health risk assessment in preparation for compliance with the BAAQMD Regulation 11, Rule 18; -Additional HCI emissions testing to optimize the wet scrubber caustic injection; and -Additional testing of HCI emissions to demonstrate compliance with the CAA Section 129 limit. An informal request for proposals (RFP)was issued for the aforementioned scope items. Montrose Air Quality Services, LLC was the only respondent to the request and was determined to be a responsive and responsible vendor. Due to recent air emissions testing, data quality, and reporting issues, Blue Sky Environmental, I nc. (Blue Sky) is no longer under consideration for emissions testing services for Central San until they have resolved these issues with BAAQMD. As such, Blue Sky and Central San have agreed to terminate the contract for convenience. In Spring 2018, Central San was notified by BAAQMD of a testing method error by Blue Sky found in a recent compliance test report for Central San's furnace emissions. BAAQMD requested that Central San retest for a specific pollutant with the correct method. Blue Sky completed the retest with the proper method at their cost. However, upon resubmittal of the latest test results, BAAQMD identified significant data discrepancies (report prepared by Blue Sky indicated passing test results, while the independent lab test data showed results above the permitted limit). BAAQMD may require another retest for this pollutant. ALTERNATIVES/CONSIDERATIONS The Board could reject the proposed agreement. This is not recommended for the following reasons: First, the Title V Major Facility Review Permit and the CAA Section 129 regulations require an emissions test to be conducted on the online MHF every year, and failure to do so will result in violations and potential enforcement actions from BAAQMD. Second, the Title V Major Facility Review Permit and the BAAQMD Permit-to-Operate require an emissions test to be conducted on the Auxiliary Boilers and Cogeneration every year, and failure to do so will result in violations and potential enforcement actions from BAAQMD. Third, without an emissions testing contract, staff would not be able to certify the newly installed oxygen monitor on MHF No. 2. The new oxygen monitor is more robust and provides a more reliable method for measuring oxygen continuously. The new oxygen monitor is also expected to reduce Instrument Shop staff time to troubleshoot issues related to sensor plugging. Lastly, without the contingency emissions testing funds, Central San faces additional risks associated with air-related violations and will be unable to efficiently conduct air emissions testing to mitigate potential air emissions compliance issues and/or properly plan for upcoming regulatory requirements. FINANCIAL IMPACTS The air emission testing for this single contract includes: September 6, 2018 Regular Board Meeting Agenda Packet- Page 105 of 135 Page 4 of 4 Annual Compliance Emissions Test on Auxiliary Boilers $ 15,624 Annual Compliance Emissions Test on Cogeneration 7,391 HCI Engineering Evaluation Emissions Test on 25,375 MHF No. 2 HCI Compliance Emissions Test on MHF No. 2 19,210 MHF No. 2 Oxygen Monitor Certification 3,709 Annual Title V and 129 Compliance Emissions Test on 65,691 MHF No. 1 Contingency Emissions Testing 83,000 TOTAL: $220,000 This project will be funded from the Operations and Maintenance account for Technical Services,Air Sources Test/Emission Inventory(Account No. 001-0270-760-09-02). COMMITTEE RECOMMENDATION This matter was not reviewed by a Board Committee. RECOMMENDED BOARD ACTION Authorize the General Manager to approve a technical consulting services agreement with Montrose Air Quality Services, LLC for an amount not to exceed $220,000 for air emissions testing services for MHFs, Cogeneration, and Auxiliary Boilers through June 30, 2019. Strategic Plan Tie-In GOAL TWO: Strive to Meet Regulatory Requirements Strategy 1 - Strive to achieve 100%permit compliance in air, water, land, and other regulations September 6, 2018 Regular Board Meeting Agenda Packet- Page 106 of 135