CAPCOA BACT Clearinghouse Resource Manual

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Permitting Processes in California
     A. The Basic Function of Permits and Permit Programs
     B. The CEQA Process
     C. District Evaluation of a Project
     D. The Permitting Process
     E. Applicable Control Technology Requirements
     F. Power Plant Certification Process
     G. Information Resources for Permitting of Stationary Sources
VI. Permitting Processes in California

        A. The Basic Function of Permits and Permit Programs

        In general, permits serve several functions. At an elementary level they serve more or less as a source registry. They also provide a link between the regulator and the regulated in terms of communication of authorized activities and requirements. The registration and tracking of sources allows one to assess or inventory stationary source emissions. Permits allow a district to more easily carry out application and enforcement of prohibitory rules. Finally, the use of conditional permits constrains the construction and operation of a source so that it will theoretically comply with all applicable standards, rules, and regulations.

        Beyond the basic functions of a permit, one can also apply discretionary requirements which are required for more specific application than prohibitory rules. An example of such requirements is found in NSR and PSD. These requirements provide a mechanism for siting a new source or modifying an existing source without causing a new, or exacerbating an existing, violation of an air quality standard. Another secondary function is to provide for a systematic review of the proposed construction and operation of the source so as to ensure compliance with more discretionary case-by-case requirements that depend on the size and nature of the source, such as stringent control technology and mitigation through reduction of existing emissions. In a broad sense, permitting programs can be thought of as measures to site sources while preventing a significant decline in local or regional air quality. This is especially true for direct or precursor emissions of pollutants which could exacerbate air quality standard violations or PSD air quality increments for attainment and unclassified pollutants. With regard to emissions of nonattainment pollutants, one of the primary reasons for a permitting program is to prevent emissions from new and modified sources from countering gains in emission reductions from existing sources through control measures in the local air quality plan. As a result, one can think of an NSR rule as an air quality maintenance measure within the context of the state implementation plan (SIP).

        B. The CEQA Process

        The CEQA process is described in Figure 5. If a project is not exempt from CEQA review, it is analyzed to determine if there is the possibility of a significant effect on the environment. If a significant effect is possible, the lead agency prepares an initial study to evaluate the potential for an effect. If there are no potential impacts, a negative declaration is issued by the lead agency. If a potential impact exists which the project proponent can and will commit to mitigate, a mitigated negative declaration can be issued. Otherwise, the lead agency will issue a notice of preparation (NOP) of an environmental impact report (EIR). At this point, responsible agencies may comment on the required content of the EIR. These comments are then used by the lead agency to produce a draft environmental impact report (DEIR). The purpose of a DEIR is to assess any significant effect on the environment by the project and to evaluate potential mitigation measures. This report is available for review by responsible agencies and the public during the public review period. Comments on the DEIR by any of these parties may be submitted prior to the end of the public review period on such topics as completeness and accuracy of the draft EIR. The lead agency then reviews these comments and prepares a final EIR with responses to comments on the draft EIR. The final EIR is used by the lead agency in approving the project and by responsible agencies in issuing permits.

        Unlike district rules and regulations, CEQA analyzes must consider: impacts of facility construction, startup and shutdown; indirect emissions from increased mobile source activity; and the cumulative impacts of projects within the area. For example, construction impacts might include fugitive dust emissions raised by mobile construction equipment. Indirect emissions may include emissions from trips to and from work by employees as well as increases in emissions from commercial vehicles using the facility. Cumulative effects account for any incremental significant effect over a period of time from the siting of sources with individually insignificant effects.

        If there is a significant impact, the lead agency will need to evaluate the need for mitigation measures identified in the EIR before approving the project. The applicant may agree to identified mitigation measures to get the project approved. However, if the applicant successfully argues that the mitigation is not feasible, the lead agency may approve the project siting due to overriding considerations.

        C. District Evaluation of a Project

        An engineering analysis is usually performed to assess emissions and air quality impacts, as well as to document compliance of the project with all applicable district and state requirements. In essence, an engineering analysis traditionally satisfies part of the California Health and Safety Code requirements for a district permit program stated in Section 42301 (a) and (b), i.e.:

        42301. A permit system established pursuant to Section 42300 shall do all of the following:
         (a) Ensure that the article, machine, equipment, or contrivance for which the permit was issued shall not prevent or interfere with the attainment or maintenance of any applicable air quality standard.
         (b) Prohibit the issuance of a permit unless the air pollution control officer is satisfied, on the basis of criteria adopted by the district board, that the article, machine, equipment, or contrivance will comply with all of the following:
         (1) All applicable orders, rules, and regulations of the district and of the state board.
         (2) All applicable provisions of this division.

In addition, since approvals are conditional, the engineering analysis should be accompanied by a proposed conditional authority to construct for each emissions unit.1 Conditions on the authority to construct will not only include required limits, but also other limits and restrictions based on 1) information in the application and 2) district assumptions regarding design and operation made in determining the approvability of the project. In some cases, an air quality analysis will be required to demonstrate that the project will not interfere with achievement or maintenance of air quality standards.
        Criteria pollutant review is relatively straightforward compared to toxic air contaminant (TAC) review. The objective with criteria pollutant review is to prevent violation of a standard or air quality increment through the application of NSR and PSD requirements. The review process for TACs is much less established. The objective of TAC review is to not allow increased risk to health beyond acceptable levels. The process of such a review and the acceptable level of risk can vary from district to district. Most districts do not even have rules governing the process of TAC review within the permitting process. Most are using policies; however, a CARB-approved risk management guideline is available for use by districts.2 If an applicant wishes to site or modify a source of TACs, he or she should contact the district regarding its policies on TAC review.

        D. The Permitting Process

        Although the permitting process differs by district, there is a fair amount of interdistrict consistency. Flowcharts of the permit processes for authorities to construct and permits to operate are provided in Figures 6 and 7, respectively. Figure 6 depicts the generalized process for obtaining an authority to construct. The permitting process starts with the submission of an application; however, there is often a lot of work required of the applicant prior to application submittal. The required contents of an application are normally listed in the district rules and regulations, or a list of such contents is available upon request from the district.

        After defining the project and specifying the basic equipment, the applicant needs to calculate both separate emissions from each component source and a total for the project to determine the applicability of various permitting requirements. In some cases, usually for small sources, no control requirements may apply. If a source is small enough, it may even be exempt from all permit requirements. In the case of large sources, the applicant may have to submit a complex application containing an analysis for control technology requirements, air quality analyzes, and proposals for air quality impact mitigation.

        If emissions are high enough, application requirements normally include a BACT or LAER analysis. In this analysis, the applicant may be required to conduct a survey to determine what methods, measures, or control technologies are available for control of emissions. In some cases, alternative basic equipment, processes, and fuels have to be considered in addition to emission control technologies. The analysis would also include a justification of the applicant's proposed BACT or LAER.

        Once the application is completed, it is submitted with appropriate forms and fees to the district. The district normally has 30 days to determine if the application is complete. If the application is deemed incomplete, the district should inform the applicant of what deficiencies make the application incomplete. The applicant can then appropriately modify the application and resubmit it to the district. As with the first application, the district has another 30 days to complete its evaluation.

        After the district deems an application complete, the district normally has up to six months to process the application.3 During the application review period, many districts will prepare an engineering analysis which documents emission calculations, satisfaction of district and state air quality regulations, assumptions used to evaluate the acceptability of the project, and required conditions of design and operation to achieve and maintain compliance. Many districts will also generate proposed permits (authorities to construct), usually one

for each unit of equipment to be sited or modified. If the project is large enough, a 30-day public review and comment period is required before a final district decision on the project. If public review and comment is required, the engineering analysis and proposed permits are made available to the public and, in some cases, other air quality regulatory agencies.

        After consideration of all comments, the district may publish a decision to either approve the project application and issue final authorities to construct, or deny the application. Once authorities to construct are issued, the applicant may begin construction, and may even be authorized to conduct an operational shakedown of equipment. Normally, construction has to be completed within the life of the authority to construct.

        Once the equipment is built and the district is satisfied that it can operate in compliance with its regulations, permits to operate can be issued. The generalized process for obtaining a permit to operate prior to Title V rules is depicted in Figure 7. In some cases, this process is still in effect for non-Title V sources. However, Title V of 1990 federal Clean Air Act Amendments now requires a more administratively sophisticated program to be adopted by all California districts. The generalized process used for Title V operating permits is shown in Figure 8. Just the same, non-Title V sources may still be sited under procedures similar to those in Figure 7.

        E. Applicable Control Technology Requirements

        Both NSR and PSD programs are associated with emission control technology requirements for sources emitting applicable pollutants above specified thresholds. These requirements are in addition to previous federal NSPS and NESHAPs. The federal NSR control requirement is called LAER. The PSD control requirement is called BACT. Both were specifically defined in the federal Clean Air Act Amendments of 1977 and the Code of Federal Regulations. However, as stated earlier, these definitions have mostly not been adopted, much less uniformly adopted, by California districts.

        One may wish to note that NSPS and NESHAPs are federal requirements. Much like other programs, e.g., NSR and PSD, the programs can be delegated to the district. In fact, most districts have received delegation. Districts that have received such delegation usually use incorporation of all NSPSs and NESHAPs into their rules by reference with a prohibitory rule.

        F. Power Plant Certification Process

        The power plant siting process has several major components. They are described briefly below. The applicability of any one of these components will depend on the source configuration and status. However, the reader should be aware that the application for certification (AFC) process will normally be the most applicable process for large power plants, while small power plants applicants may be strongly motivated to seek a small power plant exemption (SPPE) for power plants under 100 MWe net capacity.

        The reader should note that the information in this subsection is intended only for the purpose of providing background on the siting program for combustion power sources. It should not be relied on solely by any applicant seeking action on an application by the CEC. Potential applicants should contact the CEC directly for current information on power plant siting processes. Alternative information sources on the CEC siting process is provided in Subsection H of this section.

Notice of Intent (NOI): The original purpose of the NOI process was to determine the need for the proposed facility, determine the acceptability and suitability of the proposed facility and site, and to evaluate alternative sites so as to reduce the risk of relying on a single proposal or site. Due to legislative changes in 1993 and policies set forth in the CEC biennial electricity reports, it is unlikely that an NOI will be required for future energy facility applications. Projects which are exempt from the NOI requirements are specified in Section 25540.6 of the Public Resources Code.

        There is a filing fee for an NOI based on the net generating capacity (one cent per kilowatt) and no process costs. The applicant must also file 150 copies of the NOI. The fee is not to be less than $ 1,000 or more than $ 25,000. The NOI process typically takes about one year once the filing is deemed adequate.

Application for Certification (AFC): Similar to the NOI process, the AFC process (see Figure 9) consists of six components: pre-filing, data adequacy, discovery, analysis, hearings, and decision. During the AFC process, the design, construction, operation, and closure of the facilities are closely examined in relation to applicable laws, ordinances, rules and standards (LORS). In addition, adverse environmental effects are identified and mitigation measures established, and the need for the facilities is determined or reconfirmed if preceded by an NOI. The AFC process ensures that proposed facilities are safe, reliable, environmentally sound, in conformance with the integrated assessment of need, and that they comply with all LORS.

        The CEC staff reviews each AFC filing and determines if the filing contains the information required by the CEC siting regulations (Title 14, California Code of Regulations, Chapter 5, Appendix B). The staff then forwards its determination to the commission who will decide to accept or reject the staff's recommendation. Once an AFC is deemed to be "data adequate," the process moves to the discovery phase. During this phase the CEC staff will personally gather information and develop data or obtain information and data from the applicant via data requests. Workshops are frequently used to discuss those requests and the subsequent responses. During the discovery phase, staff begins to prepare their preliminary staff assessment (PSA).

        The analyzes in the PSA are divided into about 23 technical areas. The two areas that directly address air quality are public health and air quality. The public health section largely addresses nuisance and health impacts associated with exposure to TACs. The air quality section directly addresses air quality impacts of criteria pollutants and their mitigation, as well as compliance with state and local air quality regulations. This analysis usually goes beyond that required by district rules and regulations. And if there is still any residual, unmitigated significant effect on the environment after the application of applicable district and state air quality laws, the CEC may impose additional air pollution control requirements. After the PSA is prepared, the staff may have additional workshops to receive direct comments from the public and agencies. Participants and the public are also invited to make written comments.

        The next part of the process is the evidentiary and adjudicatory hearings. Prior to commencement of the hearings, CEC staff, the applicant, and intervenors will submit their testimony. The final staff assessment, which contains the staff's analyzes and recommended conditions of certification, serves as the staff's testimony. During the hearings they give direct testimony and may be subject to cross examination by other parties. Commissioners, commissioner advisers, and the hearing officer may also ask questions of any of the parties. Once the hearings are closed, the hearing officer, under the supervision of the presiding member, prepares the presiding member's proposed decision (PMPD). This document is the equivalent of a DEIR. Upon consideration of the PMPD, all parties and the public are given 30 days for review and comment. At the end of the comment period, the proposed decision is finalized, making it the equivalent of an EIR. After a 15- day comment period, the proposed decision is considered for approval or disapproval at a regularly scheduled business meeting of the full commission. If the full commission approves the PMPD, the power plant is certified and the proposed decision is finalized. In some cases, however, the committee may approve the presiding member's proposed decision with amendments. The final decision includes information about the project and the nature and result of all proceedings. The decision also contains conditions for approval of the project which includes air quality conditions as explained below.

Determination of Compliance (DOC) as Part of the AFC: Although the responsible air pollution control district does not issue any preconstruction permits, the CEC siting process incorporates procedures to determine the compliance of the project with district requirements. For instance, the district participates in reviewing the application for completeness. It then conducts further analysis during the discovery phase to determine any need for more specific information needed to determine the acceptability of the project. During the analysis phase, the district independently evaluates the project and prepares an engineering analysis. The engineering analysis documents the configuration of the facility, its component sources, emissions, applicable regulations, air quality impact assessment, and lays the foundation for all proposed authorities to construct for all would-be permit units. The district's analysis contains design, operation, and other conditions needed to ensure compliance with district and state air quality regulations.

        This in-lieu "A/C analysis," including recommended permit conditions, is submitted to the commission as a DOC to the CEC. Essentially, the DOC is a statement by the district (with accompanying analysis) that the project complies with all district and state air quality regulations. It essentially acts as an authority to construct.

        According to many district rules, the DOC must be prepared no later than 180 days after the AFC is deemed complete. However, an earlier date may be desirable in order for the DOC to be filed and incorporated into the PSA. The district finalizes the DOC no later than 240 days after the date that the application is deemed complete so that it may be incorporated into the final staff assessment. The district staff may be called on to testify on the conditions or the analysis in the DOC. If the district has intervened, then the district may present separate testimony. When a project is approved, the commission decision will contain air quality conditions of certification. Some of these conditions will be in addition to those recommended by the CEC staff. However, most will reflect the requirement set forth by the district in the DOC. After the facility is constructed, the district is then allowed by the CEC to issue an operating permit to allow local enforcement of the air quality component of the compliance plan. This allows the district to conduct normal enforcement activities in assuring compliance of the new facility with state and district air quality rules and regulations.

Small Power Plant Exemption (SPPE): The CEC's approval of an SPPE exempts the proposed project from the CEC's siting jurisdiction and refers the project to the local agencies for permit processing. In order to qualify for an SPPE, the project must meet two criteria:

        1. The project must have no substantial adverse impact on the environment or energy resources resulting from its construction or operation; and
        2. It must conform with the CEC's adopted energy demand forecast.

        The emphasis of the review is on environmental impacts and need assessment. Unlike the AFC only limited engineering analysis is performed by the CEC staff, and there is no data adequacy review. The CEC serves as lead agency under CEQA for any SPPE. The resulting staff analysis is contained in an initial study which supports the findings necessary for a negative declaration or mitigated negative declaration. The initial study serves as the testimony of the CEC staff. After the CEC approves an SPPE and issues the negative declaration, the initial study/negative declaration is also used by responsible agencies which must subsequently issue permits for the project. Therefore, after an SPPE approval, the applicant only needs to obtain a preconstruction permit from the applicable air pollution control district without any need for any additional CEQA document.

        There is no filing fee, but 100 copies of the SPPE must be filed. The applicant must pay the costs of staff's environmental review. The typical processing time for an SPPE is six months.

        G. Information Resources for Permitting of Stationary Sources

        The following are sources of information one may use to get further information on stationary source permitting programs:

        ARB Web Page

                Access: The web page is at /.

                a. Federal Clean Air Act.
                b. California Health and Safety Code. You may also order a copy of Division 26 of the Health and Safety Code from the Air Resources Board Public Information Office at (916) 322-2990.
                c. Rules and regulations for California districts.
                d. Downloadable BACT compilation document on Wordperfect 6.1 format. Note that you may keep your tables current since they are periodically updated.
                e. Searchable BACT database.
                f. Business assistance information.

        The U.S. House of Representatives Internet Law Library

                Access: Web page at

                Contents: Code of Federal Regulations.

        Office of Planning and Research, California Governor's Office

                Access: Web page at, then choose CEQA.
                Contents: The web page contains the CEQA statutes, regulations, and guidelines. One may also order the manual from General Services at (916) 574-2200. The clearinghouse is part of the Office of Planning and Research. The manual is called the "California State Clearinghouse Handbook." The current edition is that of September 1987.

        California Office of Permit Assistance, California Trade and Commerce Agency

                Access: Web page at

                Contents: The web page has access to the California Permit Handbook. One may also order the handbook at (916) 322-4245.

        U.S. Environmental Protection Agency (U.S. EPA)

                Access: Web page at for U.S. EPA in general, or for the Office of Air and Radiation.

                a. U.S. EPA publications
                b. State agency addresses and phone numbers
                c. Technical contacts
                d. Organizational structure
                e. Federal Clean Air Act and 1990 amendments
                f. Federal regulations

        U.S. Environmental Protection Agency Technology Transfer Network Bulletin Board

                Access: Web page at

                Contents: There is an array of services offered on this bulletin board. Examples are:
                a. Emission Measurement Technical Information Center (EMTIC)
                b. RACT/BACT/LAER Information System (BLIS)
                c. National Air Toxics Information Clearinghouse (NATICH)
                d. New Source Review (NSR)
                e. Support Center for Regulatory Air Models
                f. Federal Clean Air Act Amendments (CAAA)
                g. Control Technology Center (CTC)
                h. Small Business Assistance (SBAP)

        California Energy Commission

                Access: The web page is at

        Contents: The web page has information on the structure of the agency and functions of the CEC and its various divisions and offices. In addition, there is information about the siting process and the following:
                a. The Warren-Alquist Act, Public Resources Code 25000 et seq.
                b. The Commission Siting Regulations, Title 20, California Code of Regulations, Chapters 1, 2, and 5
                c. A more detailed explanation of the siting processes, including flow charts for the AFC and SPPE processes
                d. A guide to public participation in the siting process
                e. An explanation of the roles and responsibilities of various parties, including the commissioners, siting case committee, hearing officer, public adviser, applicants, CEC staff, other public agencies, intervenors, public, and executive director
                f. A commission siting history

                Other Information:

                a. All siting process questions should be directed to the Energy Facilities Siting Office at (916) 654-5100.
                b. The Publications Unit has copies of past commission decisions which cover the requirements and conditions for each approved AFC and SPPE. The Publications Unit can be reached at (916) 654-5200.
                c. The CEC 's public adviser can be reached at (800) 822-6228 or (916) 654-4489. The public adviser is an attorney who is available to explain the CEC's legal procedures, advise the public on the most effective methods of participation, facilitate public participation, assist the public in obtaining records, and other duties.

1. As defined in federal regulations, an emissions unit means any part or activity of a stationary source that emits or has the potential to emit any regulated air pollutant listed under Section 112(b) of the federal Clean Air Act. Note that an emissions unit is an identifiable portion of an encumbering facility, or stationary source. The term "stationary source" is avoided since some California NSR rules have previously used a dual-source definition, i.e., the term is defined to simultaneously refer to both the facility and any one of its component emissions units, depending on the context. As a result, rule emission calculation procedures and requirements apply at both the emission-unit and facility-wide levels. In such cases, analyzes of emissions and requirements must be conducted separately at both levels. Where an emissions unit and facility-wide analyzes result in two different requirements for a given emissions unit (such as, BACT or LAER being required in one analysis but not the other), the most stringent requirement would apply.

2. See CARB publication titled "Risk Management Guidelines for New and Modified Sources of Toxic Air Pollutants." This document is available from the Public Information Office of CARB.

3. In cases where complications arise, the district may extend the review period beyond six months if the applicant approves.

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