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HomeMy WebLinkAboutAQ_F_1900015_20151102_ENF_SOC Special Order By Consent ARAUCO PANELS USA, LLC BEFORE THE NORTH CAROLINA ENVIRONMENTAL MANAGEMENT COMMISSION STATE OF NORTH CAROLINA ) COUNTY OF CHATHAM ) IN THE MATTER OF: SPECIAL ORDER BY CONSENT ARAUCO PANELS USA, LLC ) SOC 2015-02 MONCURE MANUFACTURING SITE ) MONCURE, CHATHAM COUNTY ) NORTH CAROLINA ) [SITE NUMBER 05/19/00015] This SPECIAL ORDER BY CONSENT (hereinafter referred to as the "ORDER") is made and entered into pursuant to North Carolina General Statute 143-215.110 by and between ARAUCO PANELS USA, LLC (hereafter referred to as "ARAUCO" or "COMPANY") and the ENVIRONMENTAL MANAGEMENT COMMISSION,an agency of the State of North Carolina (hereinafter referred to as the "COMMISSION"). WITNESSETH: I. The COMMISSION and ARAUCO do hereby stipulate and agree to the following: A. ARAUCO Panels USA LLC ("ARAUCO" or "COMPANY") operates a manufacturing site that includes a Particleboard Manufacturing Facility ("PB Facility") and a Medium Density Fiberboard Manufacturing Facility ("MDF Facility") (hereafter referred to collectively as the "FACILITIES") in Moncure, Chatham County, North Carolina. The FACILITIES currently operate under Air Permit 03449T44. B. The PB and MDF FACILITIES include "affected sources" subject to MACT requirements under 40 CFR Part 63 Subpart DDDD ("Subpart DDDD" or MALT). The FACILITIES are also subject to certain requirements under the Prevention of Significant Deterioration(PSD)program and the State Toxic Air Pollutant program under 15 NCAC 2D .1100. No exceedances of the North Carolina Acceptable Special Order By Consent ARAUCO PANELS USA, LLC Ambient Levels are anticipated to occur as a result of increases in air toxics emissions. C. Air pollutants from the FACILITIES are controlled by several pollution control devices, including Photo-catalytic Gas Treatment (PGT) systems on each manufacturing line. The PB Facility includes one PGT system, while the MDF Facility has two PGT systems. These systems were installed by the FACILITIES' previous owner. The PGT units oxidize and thereby destroy volatile emissions, including the hazardous air pollutants (HAPs) formaldehyde and methanol, using hydrogen peroxide and UV lighting systems. The PGT units require significant quantities of proprietary ferrous sulfate and oxalic acid solutions for catalyzing the oxidation reaction. The UV lighting systems are difficult to maintain and require frequent replacement due to the difficult operating environment. D. On March 31", 2015, COMPANY representatives met with staff of the Division of Air Quality (DAQ) from the Raleigh Regional Office, and Raleigh Central Office Technical Services and Permitting Sections to discuss the current operating and reliability problems with the PGT pollution control devices at the Facilities and employee safety issues related to chemical exposure and UV-C radiation. Hydrogen peroxide leaks have led to several fires at the Facilities. The PGT units consume about 46,000 pounds of 50% hydrogen peroxide per day, approximately 15 million pounds per year. Three fires have occurred as a result of chemical handling accidents related to the PGT's since 2013. An employee's leather boot reacted and caught on fire when he walked through a small leak of hydrogen peroxide in the chemical storage room in February 2013. A pinhole leak of hydrogen peroxide accumulated on a nearby plastic tarp, reacted with the tarp, and ignited into a fire in July 2013. A nitric acid tote leaked in the trailer of a delivery truck causing the bed of the trailer to catch on fire in October 2014. Nitric acid mist from small leaks in pumps has degraded all non-stainless steel structures in the PGT chemical storage areas. Employees working in these areas are at risk to both chemical burns and acid mist inhalation since mitigation tools in place may not be effective in all cases. Maintenance of the UV light systems exposes employees to UV-C radiation for which no feasible protection, other than a physical barrier, - 2 - Special Order By Consent ARAUCO PANELS USA, LLC exists to prevent exposure and tissue damage. Visors and face shields may not be completely effective and may still result in burns. Consequently, as UV light maintenance has resulted in several incidents of employee skin and eye burns, replacement of the control technology installed by the FACILITIES' previous owner is required. E. PGT operation requires a chemical reaction within a very narrow, low pH range and is difficult to sustain on a continuous operational basis. For example, the PB Facility Wet ESP utilized for particulate control requires a high caustic pH level for consistent operation. The Wet ESP exhausts to the PGT unit and drives the pH level up. To reduce the pH for the correct operating level for the PGT unit requires continuous addition of 90% nitric acid to meet the required pH level, resulting in cyclical pH swings in the PGT unit destabilizing the system and reduces the HAP destruction efficiency. This pH adjustment requires the plant to utilize approximately 650 gallons of 90% concentration nitric acid daily. In addition, the defoamer chemical required for the Wet ESP also exhausts into the PGT unit and further inhibits HAP destruction by consuming hydrogen peroxide in the PGT, which is the critical chemical for HAP reduction. F. The Moncure site was acquired by ARAUCO in 2012 and after thorough investigation and firsthand experience operating the PB dryers, ARAUCO has determined that the PB PGT is undersized for the airflow required to safely operate the two PB dryers. The undersized unit causes system back pressure which has led to dryer fires, and is causing the Wet ESP to go from negative to positive pressure at points during continuous operation. In an attempt to alleviate this safety issue, the Wellons heater was converted from wood-firing to natural gas in 2014 but the fires have persisted. G. The operation of the PGT units on a continuous basis includes use of hydrogen peroxide, ferrous sulfate, oxalic acid, and nitric acid for the chemical reaction and operation of UV lights and pumps. Substantial maintenance is required for each of these systems, including the UV lights, spare parts and pump replacement. In particular, .due to the corrosive operating environment, UV lights need to be - 3 - Special Order By Consent ARAUCO PANELS USA, LLC completely replaced at least every 9 months and generate universal waste of approximately 1,600 UV lamps and 800 ballasts per year. H. In consideration of the significant employee and contractor safety concerns, fires, and operational issues experienced and discussed above, the COMPANY has requested an ORDER to allow shutdown of the PGT units in order to eliminate the operational and safety concerns and to replace the units with alternate pollution control devices while continuing manufacturing operations. Immediate shutdown of the PGT units is required due to their location and space adjacent to the PB and MDF manufacturing operations. In order to locate and construct the new control devices,the peroxide and reaction tanks must be removed, as well as the PGT units. I. This ORDER authorizes operation of the FACILITIES without operating the PGT units for the period of time necessary for DAQ to evaluate applications and revise the air permit and for the COMPANY to install, shakedown, and test new air pollution control devices, and to implement all applicable requirements of this ORDER. Potential emissions (based on 8760 hour operation) from the particleboard plant while the PGT unit is being replaced will increase by approximately 165 pounds per day of methanol and 340 pounds per day of formaldehyde. Emissions from the MDF plant during PGT replacement will increase by 1,270 pounds per day of methanol and 925 pounds per day of formaldehyde. Upon cessation of PGT control operations, the DAQ will issue a Notice of Violation (NOV) to the facility for violation of MACT Subpart DDDD for operating the FACILITIES without MACT control. The COMPANY will notify DAQ by letter, as provided in Section II below, of the shutdown of the PGT units. The MDF FACILITY may exceed the permitted PSD avoidance limit for VOCs depending on product mix and timing of the start-up of the replacement control technology. J. Installation of new air pollution control devices will likely require significant additional water use in the devices and result in the need to discharge significant quantities of treated water from the FACILITIES. As a result,the FACILITIES will likely require NPDES surface water discharge permit(s) or other authorizations to discharge to surface water. DAQ will work with the COMPANY and other DENR - 4 - Special Order By Consent ARAUCO PANELS USA, LLC agencies for issuance of any necessary water permit(s) or authorizations to the COMPANY on a timely basis. Given the large volume of water used in a Biofilter if this type of unit is selected the unit could not be started up or operated without the necessary water permit(s) or authorizations. In the event that issuance of the NPDES permit by the Division of Water Resources is delayed beyond December 31, 2015, the schedules in the ORDER may require revision. In that event, DAQ and the COMPANY will consult and revise them to the extent allowed by 15A NCAC 2D .2200 or take other appropriate action. K. During the period of this ORDER, all pollution control equipment at the FACILITIES, other than the PGT units, that are required by the current air permit shall continue to operate in compliance with all requirements. L. The COMPANY has converted the resin used in its Particleboard manufacturing to MDI, a formaldehyde-free material. As a result, formaldehyde and methanol emissions from the operation have been significantly reduced. THEREFORE, the COMMISSION and the COMPANY, desiring to resolve and settle the compliance issues between them, have agreed to enter into this ORDER with the following terms and conditions: II. The COMPANY, desiring to operate in a safe and environmentally sound manner in accordance with the rules and regulations of the COMMISSION does hereby agree to perform the following activities: A. MDF FACILITY i. Within one day of PGT unit shutdown, the COMPANY shall officially notify the DAQ by letter. The DAQ will issue a Notice of Violation for operating the 40 CFR 63 MACT DDDD equipment without the appropriate controls to demonstrate compliance. ii. In the event that the FACILITY exceeds the permitted PSD avoidance limit for VOCs, a stipulated penalty will be due per section III of this SOC. The COMPANY shall officially notify the DAQ by letter within 14 days following the end of the month that the PSD avoidance limit exceedance - 5 - Special Order By Consent ARAUCO PANELS USA, LLC occurs. If deemed necessary by the DAQ Director, a PSD permit application shall be submitted within 120 days of notification by the DAQ. iii. Air flow from the MDF press will be ducted to the furnace for combustion of VOC and HAP emissions. The Company will commence construction of the new ductwork within 30 days after execution of this Order, and complete the duct work within 180 days after execution of this Order. The ducting of these gases will result in the immediate control of approximately 20 tons of VOCs and 10 tons, respectively, of formaldehyde and methanol per year. iv. Within 90 days after the effective date of this ORDER, the COMPANY shall file with DAQ an application for a revised permit for the installation of a Biofilter or other alternative pollution control technology to replace the MDF PGT units. If an alternative, non-MACT DDDD Table 2 control technology is chosen, the facility shall also petition EPA Region IV for operating parameters and copy the DAQ on the letter. V. The COMPANY shall sign the necessary contract(s) for the purchase and installation of the control technology to be installed within 6 months after issuance of the revised permit by DAQ. vi. The COMPANY shall commence construction according to the specifications in the contract(s) within 3 months after signing of the purchasing contracts. vii. The COMPANY shall complete the installation according to the terms of the contract(s) within 20 months after issuance of the revised permit. viii. The COMPANY shall submit a test protocol at least 60 days prior to the compliance test. ix. The COMPANY shall conduct engineering evaluation, shakedown, and compliance testing to demonstrate compliance with applicable permit requirements and submit a test report within 180 days after completion of installation. X. The COMPANY shall submit no later than 14 days after the deadline for completing each milestone required in Paragraph II.A.v through vii written - 6 - Special Order By Consent ARAUCO PANELS USA, LLC certification to the Air Quality Regional Supervisor, Raleigh Regional Office, Division of Air Quality, whether such milestone has been performed. B. PB FACILITY i. Within one day of PGT unit shutdown, the COMPANY shall officially notify the DAQ by letter. The DAQ will issue a Notice of Violation for operating the 40 CFR 63 MACT DDDD equipment without the appropriate controls to demonstrate compliance. ii. The COMPANY shall evaluate the practicability of installing a new Biofilter Unit according to the following schedule. iii. In order to properly evaluate seasonal temperature variations, testing and evaluation of the Biofilter Unit shall be completed within one year of the effective date of this ORDER. The evaluation will include venting the particleboard dryer exhaust to atmosphere and capturing a slip stream from this exhaust to route through a pilot unit. This will aid in determining the effectiveness and viability of a pilot biological air treatment system when receiving the caustic Wet ESP exhaust. If the pilot unit is successful, then the facility will proceed with the engineering and acquisition of a biological air treatment system. iv. If a Biofilter Unit proves to be practicable for the PB FACILITY, the COMPANY shall submit a permit application for installation within 90 days after completion of the testing and evaluation. V. If a Biofilter Unit does not prove to be practicable, the COMPANY shall submit a permit application for installation of an Alternate Pollution Control Device within 90 days after completion of the testing and evaluation of a Biofilter Unit. vi. Installation of either a Biofilter Unit or an Alternate Control Device shall follow the same schedule and requirements as set forth above in Paragraph II.A.ly-x. - 7 - Special Order By Consent ARAUCO PANELS USA,LLC III. The COMPANY shall pay the following civil penalties: A. The COMPANY agrees to pay the COMMISSION a stipulated penalty of$1,000 per month for the period from shutdown of the PGT units until the new pollution control units are operating. This sum is due and payable on a semiannual basis and shall be paid with submittal of the FACILITIES' semiannual Title V reports by January 30th and July 301h each calendar year. B. The COMPANY agrees to pay the COMMISSION a stipulated penalty of$1,000 per month for each month that the MDF 12-month total PSD avoidance limit is exceeded. This sum is due and payable on a semiannual basis and shall be paid with submittal of the FACILITIES' semiannual Title V reports by January 30th and July 30th each calendar year. C. The COMPANY agrees to pay the COMMISSION a civil penalty in the amount of $60,000. This amount shall be due and payable within 30 days of the effective date of this ORDER. IV. In the event that the COMPANY fails to comply with any deadline as set out in this ORDER or fails to achieve final compliance with any applicable requirement in this ORDER, the COMPANY agrees that,unless excused under Paragraph V, the COMPANY will pay the COMMISSION according to the following schedule: Deadlines and Requirements Stipulated Penalties Failure to comply with any deadline in $500 per day for the first 5 days and Paragraph 1I (A, and B) and Paragraph III $1000 per day thereafter. Stipulated Penalty Failure within thirty (30) days of receipt of the Director's written demand to pay the penalties will be grounds for a collection action, which the Attorney General is hereby authorized to initiate. By entering this ORDER, the COMPANY waives any and all defenses and agrees that the sole issue in such action is if the COMPANY is excused pursuant to Paragraph V of this ORDER. The COMPANY shall pay all costs, including agency and attorney fees, associated with collection of a delinquent stipulated penalty. - 8 - Special Order By Consent ARAUCO PANELS USA, LLC V. The COMPANY's obligation to comply with the requirements set forth in this ORDER for which a stipulated penalty may be assessed, may be delayed or excused only to the extent that noncompliance is caused by circumstances beyond control of the COMPANY, as determined by the DAQ Director(hereinafter referred to as the"DIRECTOR"). Contractor delays or failure to obtain funding will not be considered events beyond the COMPANY's control. If any such delaying event occurs,the COMPANY shall notify the DAQ in writing within ten(10) days of encountering or discovering the delaying event, describing in detail the event or delay, the precise cause(s) of the event or delay, the measure(s) taken and to be taken by the COMPANY to prevent or minimize the event or delay, and the schedule by which those measures will be implemented. If the DIRECTOR determines that non- compliance with this ORDER was caused by circumstances beyond the control of the COMPANY, the COMMISSION and the COMPANY jointly may stipulate and agree to a written modification of this ORDER. Extension of any compliance date pursuant to this Paragraph shall not extend any subsequent deadlines established in the ORDER unless the subsequent deadline necessarily is dependent upon completion of the earlier deadline. VI. This ORDER shall pertain only to that equipment, sources, and operations described in Paragraph I.B of this ORDER. Any violation of Air Quality Standards resulting from these emission units or any other sources or equipment for which the COMPANY is responsible, shall subject the COMPANY to appropriate enforcement action pursuant to North Carolina General Statute 143-215.114A. VII. The COMPANY agrees to waive any rights it may have to seek judicial review to challenge this ORDER or to seek a stay of enforcement of this ORDER in connection with any judicial review of the State Implementation Plan. The COMMISSION acknowledges that this waiver does not prohibit the COMPANY from seeking modification of this ORDER if any regulatory standards upon which this ORDER is based are changed subsequent to its execution. In such cases, the COMPANY may petition that the ORDER be modified to reflect those regulatory changes. - 9- Special Order By Consent ARAUCO PANELS USA, LLC VIII. In the event the COMMISSION or the DAQ find that reports, plans, specifications, or permit applications required by Paragraph II are in any respect deficient or if additional information is necessary to comply with the requirements of North Carolina General Statutes 143-215.107 et seq., any regulations promulgated thereunder, or any other applicable laws or regulations, the COMPANY shall be notified by the DAQ as soon as possible. The COMPANY shall be afforded an opportunity to modify, amend or supplement its submissions to make such submissions complete and appropriate IX. All notices and reports required by this ORDER shall be delivered to: Patrick Butler, P.E., Regional Air Quality Supervisor N.C. Dept. of Environment and Natural Resources 3800 Barrett Drive, Suite 101 Raleigh,North Carolina 27609 All payments required from the COMPANY by this ORDER shall be delivered to: Enforcement Group—Payments NCDENR—DAQ 1641 Mail Service Center Raleigh, North Carolina 27699-1641 X. This ORDER constitutes full and final settlement and satisfaction of all matters addressed herein and any and all claims or prospective claims that the COMMISSION has or may have for violations of regulations described in Paragraph I hereof, as of the date this ORDER is approved by the COMMISSION and continuing until this Order terminates as provided in Paragraph XVI. This ORDER shall not affect the COMPANY's obligation to comply with any Federal, State, or local laws or regulations. XI. Final approval and entry into this ORDER are subject to the requirements that the COMMISSION give notice of proposed consent decrees to the public, and that the public have at least thirty (30) days within which to comment on the ORDER. XII. Should any provision of this ORDER be declared by a court of competent jurisdiction to be inconsistent with Federal or State law and therefore unenforceable, the remaining provisions hereof shall remain in full force and effect. - 10 - Special Order By Consent ARAUCO PANELS USA, LLC XIII. Any modifications of this ORDER must be agreed to in writing signed by both parties XIV. Except as otherwise set forth herein, this ORDER is not and shall not be interpreted to be a permit or modification of an existing permit under Federal, State or local law, and shall not be construed to waive or relieve the COMPANY of its obligations to comply in the future with any permit XV. In the event of termination of operations and closure of the FACILITIES, the COMPANY shall notify the DIRECTOR in writing, within five (5) business days of the earlier of(i) the date any Workers Adjustment and Retraining Notification Act(WARNA),notification, or (ii) FACILITY closure. Receipt of said notification from the COMPANY by the DIRECTOR shall terminate any obligations of the COMPANY pursuant to this ORDER, including those pertaining to stipulated penalties, and this ORDER shall become null and void in its applicability to the COMPANY. The COMPANY acknowledges its responsibilities pursuant to this ORDER from the date of final approval and entry of this ORDER, through the date of receipt by the DIRECTOR of notification of closure required by this Paragraph. - 11 - Special Order By Consent ARAUCO PANELS USA, LLC XVI. This ORDER is effective on execution by the Division of Air Quality and shall expire on September 30, 2020. �k This the day of , 2015. ATTESTED: ARAUCO PANELS USA, LLC BY: Tom Quesenberfy Manufacturing Director Moncure,N.C. APPROVED AND ACCEPTED: BY: Environmental Management Commission DATE: �l - 12 -