NC0003298_Plan of Action_20030414

NPDES DOCUHENT ! CANNIN` COVER SHEET
NPDES Permit:
NC0003298
Riegelwood Paper Mill
Document Type:
Permit Issuance
Wasteload Allocation
Authorization to Construct (AtC)
Permit Modification
Plan of Action
Monitoring Report
Instream Assessment (67B)
Environmental Assessment (EA)
Permit
History
Document Date:
April 14, 2003
Thiia document its printed on reuone paper - iiore any
content on the rezrerme aide

ATA 417 12003
NCDENR
North Carolina Department of Environment and Natural ResourcesDIRECTOR'S OFFICE
Michael F. Easley, Governor
April 14, 2003
Mr. Howard D. Lienert, P.E.
Manager, Environmental Regulatory Affairs
International Paper
6400 Poplar Avenue
International Place, Tower II 05 053
Memphis, TN 38197
DIV. OF WATER QUALITY
William G. Ross, Jr., Secretary
A,+1 '1PR 2 9 2003
Subject: International Paper Environmental Innovation Proposals under Maximum Achievable
Control Technology (MACT)
Dear Mr. Lienert:
I was pleased to receive your two March 18, 2003 Environmental Innovation Proposals and your
February 21, 2003 letter outlining your innovation programs for the International Paper (IP) Roanoke
Rapids and Riegelwood Facilities. Due to regulatory requirements, Mr. Keith Overcash, Director of the
North Carolina Division of Air Quality (DAQ), will respond to your MACT compliance extension
requests.
The reason you have given for the extension requests is to allow IP to undertake development of
Environmental Innovation Projects at both facilities jointly with the NC Department of Environment and
Natural Resources (DENR) and EPA Region IV. DENR welcomes such a request, and considers such
gains beyond the MACT requirements offered by your Innovation Proposal especially important and
worthy of a partnering relationship. As your pilot work has demonstrated, such projects are expected to
provide superior environmental results over conventional MACT standard controls.
North Carolina has other regulatory criteria that will need to be considered. Most notable are our
rules about toxic air pollutants, odors, and delegated EPA programs (including New Source Performance
Standards and Prevention of Significant Deterioration). Of most recent concern are the NC
Environmental Management Commission deliberations fording that MACT-compliant operations with
conventional paper mill wastewater treatment systems produce undesirable hydrogen sulfide emissions
and exposure levels — and the cost to remedy the situation with conventional measures is similarly
undesirable. Given that conventional measures can be inadequate and expensive, DENR agrees with IP
that a sensible alternative is to study, define, and engineer innovative controls designed to provide
superior environmental results.
As part of initially assessing your site -by -site innovations program, I propose three ground rules
stemming from -the nature of innovative experimentation and associated management principles identified
in the Joint EPA/State Agreement to Pursue Regulatory Innovation (Federal Register Vo1.67, No.86, May
5, 1998, p. 24784-96). The following ground rules seem appropriate whether or not the innovative
programs are submitted under this agreement:
1601 Mail Service Center, Raleigh, North Carolina 27699-1601
Phone: [phone] / FAX: [phone] /Internet: www.enr.state.nc.us/ENR
An Equal Opportunity \ Affirmative Action Employer — 50% Recycled 110% Post Consumer Paper

Mr. Howard D. Lienert
April 14, 2003
Page 2
•
1. Assurance that the innovative measures represent true improvements with clear advantages,
meaning that they will effect better results (that is, lower emissions of hydrogen sulfide and other
toxic and hazardous air pollutants, such as methyl mercaptan) than the MACT and other State
requirements.
2. Assurance that the innovative measures will be demonstrated to be environmentally better than
the MACT case, meaning the innovations will clearly produce lower releases of hazardous and
toxic pollutants relative to MACT controls. Credible "innovations must have results that are
measured and verifiable."
3. Assurance that the innovative measures will go beyond compliance with the MACT. The
facilities should set aggressive environmental performance goals that include pollution
prevention, a commitment to exceed compliance, and annual improvements to performance.
Goals should result in reductions of the facility's environmental impact and natural resource
conservation. Commitment to an ISO-14000 Certified Environmental Management System
should be part of the innovative approach.
I encourage International Paper's North Carolina facilities to apply to the Environmental
Stewardship Initiative at the Partner level. This two-tier initiative is designed to promote and encourage
superior environmental performance by North Carolina's regulated community. The Environmental
Partner level was established for those facilities interested in beginning the process of developing a
systematic approach to improving their environmental performance or strengthening existing programs.
Please contact Gary Hunt of the Division of Pollution Prevention and Environmental Assistance (DPPEA)
at [phone] for more information.
• I am looking forward to seeing your innovations plan in six months and am hopeful about the
promising effects offered by the effort. I am directing Gary Hunt and Keith Overcash to assign staff to
work with IP on developing the innovation plans including the selection of the appropriate route for
carrying the plan through any necessary EPA and State approvals. I am also asking EPA Region IV to
participate. If you have any questions or comments concerning the innovation proposal, please contact
Mr. Hunt. If .you have any questions or comments on the compliance extension, please contact Mr.
Overcash at [phone].
Sincerely,
i;edeot,
Wil iam G. Ross, Jr.
WGR/bko
cc: Robin Smith, Assistant Secretary Planning/Policy, NC DENR
James Carter, Assistant Secretary Operations and Development, NC DENR
James Palmer, Regional Administrator, EPA Region IV
Gary Hunt, Director, Division of Pollution Prevention and Environmental Assistance
B. Keith Overcash, Director, Division of Air Quality
n Klimek, Director, Division of Water Quality
Wayne Cook, Supervisor,, Wilmington Regional Office
Ernie Fuller, Supervisor, Raleigh Regional Office
Lee Daniel, Supervisor, Technical Services Section
Laura Butler, Supervisor, Permitting Section

ATril
NCDENR
North Carolina Department of Environment and Natural Resources
Division of Aft Quality
Michael F. Easley, Governor William G. Ross, Jr., Secretary
B. Keith Overcash, P.E., Director
Mr. Howard D. Lienert, P.E.
Manager, Environmental Regulatory Affairs
International Paper
6400 Poplar Avenue
International Place, Tower II 05 053
Memphis, TN 38197
April 14, 2003
ifk
Subject: International Paper Riegelwood Environmental Innovation Proposal
Compliance Date Extension Request for Pulp and Paper Maximum Achievable Control
Technology (MACT) I Phase II Rule [40 CFR 63.443] and the Chemical Recovery
Combustion Sources MACT II Rule [40 CFR 63 Subpart MM]
Dear Mr. Lienert:
The Division of Air Quality (DAQ) has received and reviewed your March 18, 2003 request for a
one-year extension to the compliance deadlines for the Pulp and Paper MACT I Phase II Rule [40 CFR
63.443] and the Chemical Recovery Combustion Sources MACT II Rule [40 CFR 63 Subpart MM] for
your Riegelwood Facility. Based upon your Environmental Innovation Proposal and our judgement of its
potential to take this facility "beyond compliance" for this facility, the DAQ grants International Paper
(IP) a:
• One-year extension to the MACT II compliance deadline, making the new termination date
March 13, 2005; and a
• Six-month extension to the MACT I Phase II compliance deadline, making the new termination
date October 16, 2006.
• The MACT II sources at Riegelwood include three Recovery Furnaces (No. 3, No. 4 and.No.5),
three Smelt Dissolving Tanks (No. 3, No. 4 and No.5), and two Lime Kilns (No. 3 and No. 4). The
MACT I Phase II sources include brown stock washers and several clean and recycled water streams.
IP is granted the compliance extensions provided you revise your title V permit application to
incorporate the conditions of the compliance extension and fulfill requirements related to the compliance
extension and innovation proposal. However, the 180-day extension request for both MACT II and
MACT I Phase II compliance testing is denied because testing is an inherent and integral part of
compliance. It should be understood that meeting the extended compliance deadline includes the
requirements of holding verifiable evidence (i.e., test results) that demonstrates each affected source's
compliance with the emission standard.
The stated reason for the compliance extension request is to allow IP the necessary time to
undertake development of an Environmental Innovation Project at the Riegelwood Facility jointly with
the Department of Environment and Natural Resources (DENR) and EPA Region J.V. Without the time
extension, IP would have to abandon the innovation proposal. As IP has previously demonstrated, such
1641 Mail Service Center, Raleigh, North Carolina 27699-1641 • 2728 Capital Blvd. Raleigh, North Carolina 27604
Phone: [phone] Fax: [phone] Internet: http://daq.state.nc.us/
An Equal Opportunity1 Affirmative Action Employer — 50% Recycled \ 10% Post Consumer Paper

Mr. Howard D. Lienert, P.E.
IP Riegelwood Facility
April 14, 2003
Page 2
projects are expected to provide superior environmental results in both air quality and water quality over
conventional MACT standard controls. In fact, IP expects to achieve greater emission reductions for odor
and hazardous air pollutants (HAPs), including hydrogen sulfide, using novel process improvements and
controls, than would be attained otherwise by conventional measures.
Regulatory Requirements
DAQ considers such HAP emission reduction gains beyond the MACT requirements important
and worthy of a compliance extension and partnering relationship with IP and EPA. North Carolina has
other regulatory criteria that will need to be considered, notably our rules about toxic air pollutants, odors,
and delegated EPA programs (including New Source Performance Standards and Prevention of
Significant Deterioration). In addition, DAQ is particularly interested in including hydrogen sulfide
(H2S) as a key toxic air pollutant to track and evaluate whether it would be better controlled under
innovative measures. As you know, proposed revision(s) to the Acceptable Ambient Level (AAL)
guidelines for H,S are currently under consideration by the NC Environmental Management Commission.
As part of the effort, several significant findings about H2S in the paper industry were made.
Collectively, these findings reflect a dilemma for the industry and DAQ: MACT-compliant operations
with conventional mill wastewater treatment systems produce undesirable H2S emissions and exposure
levels — and the conventional control cost to remedy the situation is similarly undesirable. Given that
current measures are inadequate and conventional controls are very costly to meet the current H2S AAL,
DAQ agrees with IP that a sensible alternative is to study, define, and engineer innovative controls
designed to provide superior and affordable environmental results.
Steps Toward Compliance
'As part of this agreement, IP must fulfill requirements related to the compliance extension and
stemming from the nature of innovative experimentation, including. The requirements are the following:
1. Completion of Innovative Plan by October 1, 2003. The evaluation / selection process of the
innovative measures (either specified process changes or emission controls) must be completed
and fully defined by October 1, 2003. At that time if IP elects not to pursue the innovations, or if
other factors preclude implementing the innovations, then IP must return to the original MACT
standard control track.
2. Innovative Plan Better than MACT. DAQ must determine that the innovative measures will
produce superior environmental results than would be attained otherwise by conventional MACT
controls. Without the time extension, IP stated that it would have to abandon the innovation
proposal. It is understood that the key purpose and prerequisite for approval of a successful
regulatory innovation is to find new, better, and more efficient and effective ways to improve
environmental and public health protection.
3. Return to Original MACT I and MACT II Tracks if Items 1 and 2 Not Met. In your March 18,
2003 meeting with the DENR Secretary and staff, you stated that all work on the MACT I Phase
II compliance would not stop while the innovation plan was being developed. Also, as an
innovations exit strategy, IP could return to the MACT control track should you be unable to
complete the innovations plan. If by October 1, 2003 IP elects not to pursue the innovative plan,
or if other factors preclude implementing the plan, then IP must return to the original MACT
standard control track.

Mr. Howard D. Lienert, P.E.
IP Riegelwood Facility
April 14, 2003
Page 3
The new termination date for the MACT II compliance extension is March 15, 2005, one year
from the date in the Rule. Compliance must be demonstrated by this date. The following dates serve as
deadlines for the steps that will be taken toward MACT II compliance:
• Submit final plans for DAQ approval of site -specific innovation projects by October 1, 2003.
• Commence on -site construction by May 15, 2004;
• Complete on -site construction by January 15, 2005;
• Complete required performance testing and hold test results for compliance determination with
the MACT II regulations by March 15, 2005.
The new termination date for the MACT I Phase II compliance extension is October 16, 2006, six
months from the date in the Rule. Compliance must be demonstrated by this date. The following dates
serve as deadlines for the steps taken toward MACT I Phase II compliance:
• Submit final plans for DAQ approval of any innovation projects by October 1, 2003.
• Commence on -site construction by December 16, 2005;
• Complete on -site construction by August 16, 2006;
• Complete performance testing and hold test results for compliance determination with the MACT
I Phase II regulations by October 16, 2006.
Should the innovation plan be better than MACT, we will gladly entertain a request from IP should
additional time be needed to install controls.
DAQ is looking forward to working cooperatively on developing this innovative plan and
recognizes the potential advantages in the results offered by the effort. If you have any questions or
comments, please contact Lee Daniel at [phone] or me.
Sincerely,
ith Overcash, P.E.
B KO/ss
cc: William G. Ross, Jr., Secretary, NC DENR
Robin Smith, Assistant Secretary Planning/Policy, NC DENR
James Carter, Assistant Secretary Operations and Development, NC DENR
James Palmer, Regional Administrator, EPA Region IV
Gary Hunt, Director, Division of Pollution Prevention and Environmental Assistance
Alan Klimek, Director, Division of Water Quality
Wayne cook, Supervisor, Wilmington Regional Office
Ernie Fuller, Supervisor, Raleigh Regional Office
Lee Daniel, Supervisor, Technical Services Section
Laura Butler, Supervisor, Permitting Section
APR 2 . - 2003
DIV. OF WATER QUALITY
DIRECTOR'S OFFICE

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INTERNATIONAL
HOWARD D. LIENERT, P.E.
MANAGER,
ENVIRONMENTAL REGULATORY AFFAIRS
PAPER
Mr. William G. Ross Jr., Secretary
NC Department of Environment and Natural Resources
512 N. Salisbury Street, 14t" Floor
Raleigh, North Carolina 27604-1148
INTERNATIONAL PLACE II
6400 POPLAR AVENUE
TOWER II 05 053
MEMPHIS, TN 38197
OFFICE PHONE [phone]
CELL PHONE [phone]
FAX [phone]
e-mail: [e-mail]
March 18, 200;
RE: Riegelwood Environmental Innovation Proposal
Compliance Date Extension Request for Pulp and Paper MACT I Phase II Rule [40 CFR
63.443] and the Chemical Recovery Combustion Sources MACT II Rule [40 CFR 63
Subpart MM]
Dear Mr. Ross:
To enable International Paper to pursue our Innovations Proposal we are requesting a one-year
extension of the compliance period for the subject requirements as they apply to our Pulp and
Paper Mill located in Riegelwood, North Carolina. The one-year extension for our Riegelwood
Mill will allow us to undertake development of an Innovation Project jointly with NC DENR and
EPA Region IV.
This request is made pursuant to MACT General Provisions [40 CFR 63.6(i)(4)(i)(A)].
Extension is necessary to define and engineer innovative controls that are expected to provide
superior environmental results. The company will work with NC DENR, EPA and affected
community stakeholders to ensure control measures will achieve parity with pollutant reductions
that would result from the MACT rules plus additional environmental improvement. Without the
additional time afforded by the one-year extension, the company would have to abandon pursuit
of the Environmental Innovations Proposal.
Affected Equipment
This extension request applies to the installation of monitoring equipment and controls for Kraft
process combustion sources (recovery furnaces, lime kilns and smelt dissolving tanks), the pulp
mill high volume low concentration (HVLC) gas collection and treatment standards, codified in
40 CFR 63 Subpart MM and 40 CFR 63 Subpart S Part 443, respectively, and to the
corresponding testing and monitoring requirements for these standards. International Paper has
notified NC DENR, in accordance with MACT General Provisions [40 CFR 63.9(b)] that the
rules for which compliance extensions are requested apply to equipment at the site. The HVLC
system control strategy and schedule identified in our initial notification document for the Pulp
and Paper MACT dated April 12, 1999 pursuant to 40 CFR 63.9(b) and in subsequent status
reports is being re-evaluated in light of the Innovations Proposal and is subject to change.

Mr. William G. Ross Jr., Secretary
NC Department of Environment and Natural Resources
Riegelwood Mill Environmental Innovation Proposal
Compliance Date Extension Request for Pulp and Paper MACT I Phase II and MACT II Rule
March 18, 2003
Page 2 of 4
interim Conirols
In the meantime, particulate emissions controls on affected units at the site will continue to
comply with applicable regulations and the existing Air Permit 03138R19. The equipment to be
affected by the MACT standards is already well controlled. (Note: Using the allowed "bubbling"
compliance approach it is probable the mill will meet the MAC? II standards without additional controls.)
Combustion source typical actual emission rates compared to the respective MACT II standards
follow:
Recovery Furnace No. 5
Recovery Furnace No. 4
Recovery Furnace No. 3
Smelt Dissolving Tanks No. 5
Smelt.
Smelt
Dissolving Tanks No. 4
Dissolving Tanks No. 3
Lime Kiln No. 4
Lime Kiln No. 3
For the MACT I Phase 2 sources, brown stock washers, a variety of clean and recycled water
streams for wash water are currently employed that minimize the release to the atmosphere. This
is facilitated by the condensate collection and treatment (per Subpart S) that provides an interim
level of control for the brown stock washer HAP emissions.
Typical Actual PM Emissions
0.017 gr/dscf
0.030 gr/dscf
0.046 gr/dscf
0.09 lb/TBLS
0.21 lb/TBLS
0.08 lb TBLS
0.009 gr/dscf
0.078 gr/dscf
MACT Limits
0.044 gr/dscf
0.044 gr/dscf
0.044 gr/dscf
0.20 lb/TBLS
0.20 lb/TBLS
0.20 lb/TBLS
0.064 gr/dscf
0.064 gr/dscf
Description of Proposed Controls
The innovative control measures to be installed will be unique to the affected mill configuration
and the needs of the affected community and have not yet been fully evaluated. However, based
on a similar project at our Pine Bluff Mill in Arkansas, we have identified control measures that
potentially provide superior environmental performance over conventional MACT standard
controls. While the projects that will compose the Innovations Program at the Riegelwood Mill
can be expected to vary from those at the Pine Bluff Mill, the projects for Pine Bluff are used as
an example of the possible projects at Riegelwood. Based on the Pine Bluff evaluation, the
Innovative Controls Proposal for Riegelwood could include similar projects to the following:
• Black Liquor Oxidation (BLOx) Vent control & associated projects for vent gas incineration
in existing recovery furnaces (air system upgrades and automatic air port rodder additions);
• Increase the compliance requirement for process condensate methanol collection and
treatment inherent in the Pulp and Paper MACT I Rule requirements [40 CFR 63.446];

Mr. William G. Ross Jr., Secretary
NC Department of Environment and Natural Resources
Riegelwood Mill Environmental Innovation Proposal
Compliance Date Extension Request for Pulp and Paper MACT I Phase II and MACT II Rule
March 18, 2003
Page 3 of 4
• Bark Boiler efficiency improvements (over -fire air, air swept distributor spouts, sludge
metering):
• Shutdown or operational limitations on existing power boilers;
• Paper Machine broke overflow collection improvements;
• Process water recycle for reduced surface water withdrawal; and
• Infrastructure improvements that include storm water segregation, evaluation of wastewater
system optimization opportunities, and closure of impoundments as wildlife/wetlands habitat.
Although the following graphs were developed for our Pine Bluff Mill Innovation Program, they
represent the types of environmental benefits that are possible through an Innovation Program at
the Riegelwood Mill.
Pine Bluff Mill Innovation Proposal
Air Quality Emission Comparison
000 --- Parity Plus vsli—also be adlie ed for
MALT Only Irdisbial 80iler MACT metal HAP enission
800 - lates_HAP reductions__
Enissials
u 600
400 j —
j
• 200
-200
HAPs SOx NOx TSP TRS CO VOC
■ Regulatory M ndMis (MACT I Phase II & MACT II) ■ Ln.wel4.r Propas
Pine Bluff Mill Innovation Proposal
mi6Water Quality Benefits Water Quality Benefits
200 T--
0
200
-400
-600
-900
c-I000
T
F-1200
-1400
-1600
-1800
2000 -
Pine Bluff Mill Innovation Proposal
Greenhouse Gas (CO2) Emissions
2 Note: This isa 1,700 TPY4naease
due to the use of an stand alone
incineiation iievise using fossil (7—ieffa HAR(methanot) destruction
■ Regulatory M•det&(MACTI Phasa 1I, MACE II 8 Ind Bair MACI)
■ Innovadan Proposal
25000
3 15000
10000
D
5000
0
a0O T55 COD
( Inlegulato0 Mandates (MAa IPNee II MACTII&Lrd Boller M►CI) I
•5 050Oon Proposal
Pine Bluff Mill Innovation Proposal
350
Im -
250
200
150
100
0
50
TotN TotP
■ Regulatory Mandalay (MACT I Mum A mar • • Ind Boa. ONO)
• In eralbn Proposal

Mr. William G. Ross Jr., Secretary
NC Department of Environment and Natural Resources
Riegelwood Mill Environmental Innovation Proposal
Compliance Date Extension Request for Pulp and Paper MACT I Phase II and MACT II Rule
March 18, 2003
Page 4 of 4
The example innovative controls also are likely to achieve the following environmental benefits:
• Reduced surface water use:
• The innovation program will facilitate process improvements and controls that achieve H2S
emission reductions. (Note: Our preliminary review indicates that we will be able to significantly reduce
H2S emissions from point sources beyond those that would be achieved as a secondary benefit for
implementation of the current pulp and paper MACT rules.)
• Odor reduction beyond that achieved by the MACT standards; and
• Create wildlife/wetlands habitat.
Upon partnering with NC DENR and EPA on the extension and innovation Proposal, we would
evaluate and quantify environmental benefits for the Riegelwood Mill that would address the
specific need of the surrounding community.
Schedule for Compliance
We would expect the schedule to proceed as follows [per 40 CFR 63.6(i)(6)(i)(B)]:
• Evaluate and propose site -specific innovation projects: 16 months before extended
compliance date;
• Commence onsite construction: 10 months before the extended compliance date;
• Complete onsite construction: 2 months before the extended compliance date;
• Compliance with Rule Requirements: March 14, 2005 for MACT II sources and April 16,
2007 for HVLC sources; and
• Completion of performance testing within 180 days of compliance date [per 40 CFR
63.7(a)(2)].
Compliance with this extension request shall be reported with the HVLC Non -binding Control
Strategy Report required in accordance with 63.455(b) biennially until final compliance is
achieved. If you have any questions or comments, please call me at [phone].
Sincerely,
Howard D. Lienert
Manager, Environmental Regulatory Affairs

cc: Mr. Dempsey Benton, Chief Deputy Secretary, NC DENR
Ms. Robin Smith, Assistant Secretary, NC DENR
Mr. Gary Hunt, Director of Pollution Prevention and Environmental Assistance, NC DENR
Mr. Keith Overcash, Director Division of Air Quality, NC DENR
Mr. Jimmy I. Palmer, Regional Administrator, EPA Region IV
Mr. Alan Barnes, Chief of Staff, EPA Region IV
Mr. Bill Patton, Program Manager, Environmental Accountability Div., EPA Region IV
Mr. Bernie Hayes, Regional Innovations Coordinator, EPA Region IV
Mr. Scott Grimes, Riegelwood Mill Manager, International Paper
Mr. Edward J. Kreul, Riegelwood Mill EHS Manager, International Paper
Mr. Thomas Sauer, CPIP Division EHS Manager, International Paper
Mr. Steve Groves, Env. Innovation Sr. Program Manager, International Paper
Mr. C. Johnny Roberts, Cluster Rule Program Manager, International Paper
Riegelwood lnnov Ext Request to NC DENR 03-18-03.doc

ADEQ
A R K A, N SAS
Department of Environmental Quality
March 11, 2003
Howard Lienert, P.E. •
Manager, Env}ronmental Regulatory Affaris
International Paper Company
6400 Poplar Avenue
Tower II 05 053
Memphis, TN 38197
RE: MACT compliance extension request
Pine Bluff Mill
Dear Mr. Linert:
On October 9, 2002, International Paper submitted a one-year MACT extension. Specifically,
the extension request applies to the installation of controls for Kraft process combustion sources
(recovery furnaces, lime kilns and smelt dissolving tanks), the pulp mill high volume low
concentration (HVLC) gas collection and treatment standards, codified in 40 CFR 63 Subpart
MM and 40 CFR 63 Subpart S Part 443, respectively, and to the corresponding testing and
monitoring requirements for these standards.
This request was submitted to enable International Paper to pursue the ECOS Innovations
Proposal for innovative control measures. The EPA has indicated a willingness to work with IP
on a specific project which has been proposed for the Pine Bluff Mill as a demonstration project.
The EPA proposes to manage this project using a team approach utilizing staff from IP, ADEQ,
and EPA.
In accordance with 40 CFR 63.6(i), we grant this extension based on IP's committment to reach
an agreement with EPA and ADEQ. The agreement will be based on each organization's
commitment to the environmental innovation project at Pine Bluff and specify the emission
reduction activities IP intends to implement at the Pine Bluff Mill, schedules for completion,
emission targets, and verification procedures. Based on discussions with EPA, we feel confident
that this agreement can be in place within 90 days.
ARKANSAS DEPARTMENT OF ENVIRONMENTAL QUALITY
8001 NATIONAL DRIVE / POST OFFICE BOX 8913 / LITTLE ROCK, ARKANSAS 72219-8913 / TELEPHONE [phone] / FAX [phone]
www.adeq.state.ar.us

This extension is based upon the information contained in your October 9, 2002 letter. The new
compliance date for the combustion sources will be March 12, 2005. The compliance date for
the HVLC gas collection system will be April 16, 2007.
If you have any questions, please contact Mike Porta at [phone] or at
[e-mail] via the interne.
Marcus Devine
Director
cc Becky Keogh, Deputy Director, ADEQ
Keith Michaels, Chief, Air Division, ADEQ
Mike Porta, Air Division, ADEQ
Sam Coleman, Acting Deputy Regional Administrator, EPA Region VI
Rob Lawrence, EPA Region VI
Craig Weeks, EPA Region VI

UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, D.C. 20460
FEB 1 4 2003
Mr. Howard D. Lienert
Manager, Environmental Regulatory Affairs
International Paper Company
International Place II
6400 Poplar Avenue
Memphis, TN 38197
Dear Howard:
OFFICE OF POLICY,
ECONOMICS, AND INNOVATION
On behalf of the U.S. Environmental Protection Agency (EPA) I want to thank you for
your ongoing interest and initiative in responding to EPA's Strategy: Innovating for Better
Environmental Results with the corporate innovations project you proposed to us. EPA's
conversations with International Paper (IP) over the last year have helped us refine our thinking
about the form a next generation innovation project might take.
In response to your December 9, 2002 letter and follow-up note on January 13, 2003, we
remain open to your corporate Environmental Innovation Proposal (and Concept Document for a
Voluntary Superior Environmental Performance (VSEP) Program), but find that the current
corporate proposal lacks environmental commitments that are robust or specific enough to
warrant EPA support for the regulatory flexibility you desire. This does not, of course, limit in
any way your ability to pursue the one year extensions available under the Clean Air Act, Section
112(i)(3)(B) with the States in which the mills you propose for the VSEP Program are located,
all of which have approved Title V permitting programs. It will solely be up to the States to
decide whether or not to grant the extensions.
At the same time, we do also want to recognize and commend IP for making innovation
in environmental protection a company -wide priority. NIP decides to perform the additional
analysis necessary in order to make more concrete environmental commitments (similar to that
done for the Pine Bluff Mill), EPA would be happy to continue our dialogue on the larger
corporate proposal.
In the near term, we would like to work with IP on the specific project you proposed for
your Pine Bluff, AR facility as a demonstration project. An evaluation of this project could help
in designing and in formulating the substance of a larger, corporate -wide innovation project. We
Internet Address (URL) • http://www.epa.gov
Recycled/Recyclable • Printed with Vegetable 011 Based Inks on Recycled Paper (Minimum 30% Postconsumer)

propose managing the project using a team approach (such as the one that could be used for a
corporate or multi -facility project), using staff from IP, the State of Arkansas, and EPA
headquarters and regional offices. This team management approach could provide valuable
experience if the project expands in scale. We recommend this process rather than initiating Pine
Bluff as a stand-alone State proposal under the Joint EPA/State (ECOS) Agreement to Pursue
Regulatory Innovation.
Clearly, if this project becomes a multi -facility effort involving more than one region
and/or State, EPA staff would need to be involved. EPA Regional staff have or will be
consulting with the States where the mills proposed for the VSEP Program are located, to
provide them with a context for any contact you may wish to initiate. Should you decide to do
the additional analyses for the seven other mills proposed for the corporate VSEP Program, it
would be helpful to us if you would share a schedule that included the timing of each mill
analysis, and for those mills not already in the Performance Track Program (Ptrack), the
projected and anticipated PTrack application and certification dates. EPA has also developed
specific comments on the Pine Bluff proposal that we hope to share with you soon. In the
meantime, to initiate official discussion on the Pine Bluff proposal, please contact David Bond or
Craig Weeks in EPA Region 6 at 214/665-6431 or 214/665-7505 respectively. Also please feel
free to call me at 202/566-0290 or Betsy Shaw on my staff at 202/566-2163 if you have any
questions.
Thank you for your continued interest in working with EPA on innovative approaches for
stronger environmental protection.
Sincerely,
Jays: enforado, Director
National Center for Environmental Innovation
cc: Steve Groves, Senior Program Manager, Corporate Environment
Betsy Shaw, US EPA
Larry Starfield
David Bond
Craig Weeks
Rob Benner
Stan Meiburg
Tom Voltaggio
Phyllis Harris
Mary Kay Lynch
Ira Leighton
Becky Keogh, Arkansas Department of Environmental Quality
2

Environmental Regulatory
Innovation Program
International Paper's
Proposal for an
Environmental Innovation Program
INTERNATIONAL
PAPER

> Introduction — Drivers for the program
Innovations program concept development
> Pine Bluff Mill, AR - Innovation proposal & schedule
Additional opportunities
Introduction - Program Drivers
• Sustainability (To demonstrate that environmental
improvement is not exclusive of economic improvement and
positive social change)
• Effective use of limited capital
Maximizing benefits for local communities
> Industrial Leadership and Regulatory Partnerships
1

$ Million
Introduction - Program Drivers
Capital Spending
Does not include future regulatory issues such as Boiler MALT
200 -- — — —-------- --
180 —
160 — —
140
120-
100-
80-
60
40-
20
0
80 82 84 86 88 90 92 94 96 98 00 02 04
Year
Introduction - Program Drivers
lir
Regulatory Mandate
Cummulative Capital Cost of $400 Million
$ MM
400
300
200
100
2002 2003 2004 2005 2006
Year
:good Products $ 8
r Boiler MACT $17E
I-VLC Controls $157
NOx SIP $ 7
oMACT II $50
2

Innovation Program
Concept Development
International Paper's Environmental Innovation Position
A comprehensive site -specific approach to achieve significant
benefits beyond implementation of generic categorical standards
Maximize environmental improvement by creative approaches to
address land and ecosystem degradation, climate change,
renewable energy systems, and industrial sustainability
Use beneficial partnerships with regulatory agencies, the public,
and nongovernmental organizations for environmental
management and regulatory innovation
Innovation Program
Concept Development
Ongoing Discussions with EPA Headquarters
• Basis for potential partnership
- Substitute process/env. projects for reg. mandates
- Achieve parity with reg. pollutant reductions and
improved overall environmental aspects
- Public and NGO participation
> Timing for program development — 1 yr. extensions
• Schedule issues - decision for individual projects

1iPine Bluff Mill Innovation Proposal
ll
L Specific regulatory requirements for off -set by process /
environmental projects with "parity plus"
- Cluster Rule MACT I, Phase II (pulp mill washers)
- Cluster Rule MACT II (recovery furnaces, LK, SDT)
- Industrial Boiler MACT (proposal by year-end 2002)
- AR NPDES impoundment / SW unit closure
Project specifics by consensus between AR DEQ EPA
INTIIINATIONAL® Mnr:.�
ii Pine Bluff Mill Innovation Proposal
Proposal Issues
> Regulatory Flexibility
- Actual -to -Actual NSR Applicability
- Flexibility to achieve MACT emission reductions with alternative
source control, or bubbling across MACT source categorical
requirements
> Air permit changes to meet implementation schedule
Plant -wide air emission applicability limit (PAL) permit
Monitoring for permanent and verifiable reductions
4

Pine Bluff Mill Innovation Proposal
—11111
r BLOx Vent Gas Control (RF2 & RF3 Air System Upgrades & Auto Port Rodders)
- Increased process condensate methanol collection and treatment
> Power Boilers (PB2 - Permanent Shutdown; P81 - Full load 120 d/yr, 1/2 Load 245 d/yr)
Bark Boiler Efficiency Improvement (Windswept Fuel Delivery & Overfire Air)
PM2 Broke Overflow Improvement (Water Recycle & Fiber Recovery)
Raw Water Substitution (Ash Sluice System, Bark Boiler Scrubber, Wash Water)
Support Systems (No. 2 Fiber Lagoon, Stormwater Segregation & ASB Optimization)
INTI nNATIONAL ®NV,
Pine Bluff Mill innova".ith r d• r d
Specified l:mironntental
Itezul+tuq Requirement Project.
Pulp NIII nigh ? oittnte Low
Coneelur:Mon (1IVI.r) Ooo
Control •- \IACT I Plwe it
'I.\(. r 1, Phase 1 Proem
Condensate Control
h4\CT 11— Process Combustion
Sources
lodmlrinl Moiler p1ACT - Projected
Solid Waste Site Closure —No 2
Sludge l:aooun
Ibtat Protium site -Specific I r,syss
IT \i\Il & Ensironnnntal Projnt+
11.15
(O&M
Only)
0.50
6.90
1.2
Mark Liquor Oxidation Vent
Co:urtd
is ?ISO
4.S
Moiler Shutdowns 11.2
Mark Moils 1:tfiricnec IA
Impto\ colon
No. 2 Paper Machine Broke
Overflow Improvement
OS
Raw Wader Substitution 2.0
Support Sy^sicros Projects 5.5
Tool ��:.�. 11.5

f non
t.
TSS
COI)
Pine Bluff Mill Innovation Proposal
t BLOx & Recovery Furnace Projects
•
tbr
nLv •. ,.n e) lice E:corrr noecrtufro%netua
1 Pine Bluff Mill Innovation Proposal
BLOx & Recovery Furnace Projects
Methanol
lab 5 TPY Reduction
(15.3.3 TPY Putentlnl Reduction) !
19n.2 TPY Increase
(273.63 TPY Potential Increase)
SOs
i Pith,
TRS (us li S)
r •-
CO
ltnquantificd Increase
101.2 TPY Reduction
(145.6 TPY Potential Reduction)
1
Unquntttified Increase
CO, 1.575.5 TPY Incre se
(2,823.5 TPY Potential Increase)
VOC 437.6 TPY Reduction -.• "•+
(785.7 TIT Potential Reduction)
..•� •-,^.Load Reduction
Load lteductlol
Lead Ite Inchon
Water Use Recycle 1 Reduction Water Use Reduction
,H ,or.u®rani
6

Pine Bluff Mill Innovation Proposal
Process Condensate Control Project
r Collection and treatment of process condensates beyond
the current regulatory requirement reduces methanol by
562 TPY
An additional +50 TPY will be committed to as a regulatory
requirement for collection and control
Pine Bluff Mill Innovation Proposal
Power Boiler Projects
T

Pine Bluff Mill Innovation Proposal
Power Boiler Projects
Metn111APs
I SO.
NO:c
I TSP
Unquantifled Reduction
779.7 TP\ Reduction
(934.2 TI'N' Potts t in I Red ti(ilDu)
852.4 TP\ Reduction
(1,865.5TP1 Put. Reduction) 1
3o.4 11.1 Reduction
(89.5 'LPN Potcsniol Reducliou) !
!---. - _
C() 52-3 11'1 Reduction
(159.11 ift'Y Reduction) I.
Sign; dean'. liecluction
I co,
1 VOC • 3.7 TI' \ Reduction
. ; (7.9 ITS' Potential Reduction) i
I Water Use Reeyelc / Reillieli011
681 8181g1itty r NVotel the
)(eduction I
_I
INTERNATIOHA4 PAPER
Pine Bluff Mill Innovation Proposal
Bark Boiler Projects
For L Lotvvrtneuis
•
d r.11.01up,
Aredir 1 .
: Bs1:011-r. •[4.115.4,
A:A -dr • Ar
Overt.
Air
o r lak.othoweet•
•••••••
" •
%AI
Frohli,••
•
aro
twriliNATIONAL@ PAHA
8

Pine Bluff Mill Innovation Proposal
Bark Boiler Projects
co
VOC
Mater Use Recycle/ Reduction
— .
Lont1101 Rethiction
0.01 1PY Rethiction
(0.21 TPY Potential Reduction)
8.6 TI'Y Reduction
(53.3 TPY Potential Reduction) it
0.003 ITV Reduction
(0.03 I'VV Potential Reduction)
0.4 TP`c Reduction
• (2.9 1 PY Potential Rtductinn) I
0.02 1 11 Reduction
(11.3TPY Potential Redutaion) I
-----
Water Use itedin lino
Unquantilled Redaction i
INTIMATIONAL@PAPER
Dine Bluff Mill Innovation Proposa!
No.2 Paper Machine Project
No. 2 Foyer Machine 'Broke Overflow Duprovement
<Sir ro:r:
Pteposed
r
Machine
:lhest
!".1 ' :11.• •rnr, ?us—.
. • • • • and dk ndl :•••••
n•;131pke t: • - ft•ial
ply ',oat
Ble3cla I'lanl.Weshet
Mnl ply
Bland
Chest
•1.
INTINNATIONALe PAPER
9

Pine Bluff Mill Innovation Proposal
No.2 Paper Machine Project
SOx 29A TPY Reduction
NO 15.3 TPY Reduction
'ISP 7.5TPY Reductions
t TRS (as 1I2S) 1.7 TPY Reduction
CO • 21.4TPV Reduction
YOC 9.1 TPY Reduction
j Water Use 25 MM \\'atcr
Rec}cle/Red. Use Reduction
i Fiber Recovery 3,700 I'PY
Pine Bluff Mill Innovation Proposal
Groundwater Use Reduction Project
R.1t' WATER SUBSEITU•AON
PApP,rtudlon4 F!rec- _
11
PCMn4.n GC4cseed R<eev.r/
i tnl0u lbun PLL se. f
Paper %bids
025 MOD Ave?”•.47UM1er
Ash Pputt ^." III ,
t
I
To 011.uPo ucre
Re•vre And Pulp M1122
T. ...It Pluiee Wet&
r:...Tod road
(T.+iUory
rl�n:,.:luihn
Po
INTERNATIONAL®PAPER
10

jPine Bluff Mill Innovation Proposal
i Groundwater Use Reduction Project
130I)
TSS
C(ID
Total Nitrogen
'Total Plu.Np0orus
5.800Ibiday Reduction from
diversion ofwbitcwater
NA
20.850Ibldal Reduction
290 @/dn. Reduction in
nntricm rennin:moot
58Ibldac Reduction in
nutrient requirement
—._-_- Water UseRurlc1Reduction + Expected: 4 NIGI) Potential: 10 MCI)
INTERNATIONAL IPATEA
Pine Bluff Mill Innovation Proposal
Infrastructure Projects
No. 2 Fiber Lagoon - Closure as Wildlife Habitat
Storm Water Segregation - segregation of storm water contributing
to Outfall 001, followed by equalization and natural attenuation in
Johnson Lake or treatment in one of the facility's constructed
wetlands
➢ Wastewater Treatment (Aerated Stabilization Basins — ASBs) System
Optimization - Depending on the success of unloading the existing
aerated stabilization basins (ASBs) influent volume by raw water
substitution and elimination of storm water from the main wastewatcr
ditch, there may be an opportunity to optimize the current basins.
11

Pine Bluff Mill Innovation Proposal
Infrastructure Projects
Wildlife Benefits ,__���. .,—........_..._. Sl 1L� c % uI1lI to Habitat _- _.
h:tier Use Recycle:Reduction 20AIGUPe.IkLoa/lticductinn_ _
' Ntetlmnul __-•.•—' •••— —.I Potential Reduction, due toimprulalnet obit �•
environment
_—_______ ________ . _ — .._
IRS (as II,S) Potential Reduction. dtte to improved aerobic
ear iron meld
CII, Potential Reduction, doe III improved aerobic
environment
t HOD 461r Rol m:lion aumtner
66• , f2cduct i,n While?
1 MSS Potential is I„ 511", Ralncl ion
COI) Fur degradnhle fraction. comparable reduction;
11 to 1111I1
1 WW1' Sludge Digorlion ,hmddpros idcmore elleclne
— 1 Landfill Reduction
' degradation of hiulo;ieally generated solids.^,
Potential avoidance for e..li1ated t4,000 cy of
asherete
Pine Bluff Mill Innovation Proposal
Additional Environmental Aspects
Community / State Benefits .
- Groundwater Aquifer Use Reduction of at least
2,089 Million Gallons / Year
- Mill Sustainability
- Increased Odor Reduction
- Water & Air Quality Improvement
- Increased Wildlife Habitat
- Solid Waste Reduction
INTERNATIONAL © FA>EN
12

TPY Reduction
Pine Bluff Mill Innovation Proposal
Air Quality Emission Comparison
1000
MACT Only
800 Reguiates_HAP
Emissions
600 -- -
400
200
0
-200
HAPs SOx NOx TSP TRS CO VOC
T
;Regulatory Mandates (MACr I Phase II & MACT II) • Innovation Proposal
200
0
-200
-400
o -600
800
ex -1000
F -1200
-1400
-1600
-1800
-2000
Pine Bluff Mill Innovation Proposal
Greenhouse Gas (CO2) Emissions
�— Regulatory mandates cause a
_Note:
1,700 TPY increase due to the use of
an stdlid-alone-incilm'ation des/
using fossil fuel for NAP (methanol
destruction
J
■ Regulatory Mandates (MACT I Phase II, MACT II & Ind. Boller MACT)
• Innovation Proposal
13

Pine Bluff Mill Innovation Proposal
Water Quality Benefits
pounds / Day Reduction
25000
20000
15000 —
10000 --
1
il5000 -
o i" -7 -r
SOD TSS COD
• Regulatory Mandates (MACT I Phase II, MACT II & Ind. Boiler MACT) I
Innovation Proposal
Pine Bluff Mill Innovation Proposal
Water Quality Benefits
Pounds 1 Day Reduction
350 —
Tot N Tot P
• Regulatory Mandates (MACT I Phase II, MA CT II & Ind. Boiler MACT)
• Innovation Proposal

Pine Bluff Mill Innovation Proposal
Air Quality Emission Comparison
000 --Plu. Au. a '.�er(—
iMn,1 Only :whoa ? HALT T.CG:::cP anagi0f1
8 aan
.00
1oa�a
NAP. SO9 NOA TS9 IRS
CO
VOC
a44.4t..y Maa4N] IM.:CTI Mat. II• rACt tan •taawae+.
Pine Bluff Mill Innovation Proposal
Water Quality Benefits
• 00 Ts$ C00
ta+n.Y MsabtafMav tyYw 1 WCI Fi W a••a wnT—1
• L.aueraraaW _ —
• -400
BOO
t( •l000
.1200
-1100
•1.00
Pine Bluff Mill Innovation Proposal
Greenhouse Gas (CO2) Emissions
t0A: ml1I0.0_ 6BY w•••
dots to thous. of an stand alone
tea. along ra,�rdeT
Ha luPf teatwoatfa«taw W-
r ••a••kveywt.s.t.. IMN9I aa.r lL waR TI• IH_111LaXKr)
•fawnpw hey.rl �J
Pine Bluff Mill Innovation Proposal
Water Quality Benefits
at n tat9 T-
Mawr. tMatf naYrli a nt r ,; t MCI l
•Irw.lwalwtau� __ __.._
•
Pine Bluff Mill Innovation Proposal
Summar
y
b= "Parity" for Regulatory Offset Pollutants (HAPs)
Overall Improvement for Area Air Quality, Water
Quality, and Solid Waste Reduction
Y Reduced Odor
➢ Wildlife Benefit
y Improved Sustainability
Requires
- Immediate 1 year MACT Variances
- Alternate Implementation Schedule
- Regulatory Flexibility (Permit Modifications and NSR)
INT1RNATIONAL®&A/ER
15

Environmental Innovation
Other Opportunities
❖ EPA Region 3
• Franklin Mill — VA
•:� EPA Region 4
y Roanoke Rapids Mill — NC
Riegelwood Mill — NC
Georgetown Mill — SC
Y Vicksburg Mill — MS
❖ EPA Region 6
• Louisiana (Bastrop) Mill — LA
▪ Texarkana Mill — TX
Pine Bluff Mill - AR
Other Opp
Environmental Innovation
Other Opportunities
❖ Need for EPA & State endorsement
❖ Framework for new innovation approach
❖ Schedule issues
r MACT 1I & MACT I, Phase II implementation March
13, 2004 and April 17, 2006, respectively
Y Need for project endorsement and 1 year extension
Need to develop compliance schedule for project
implementation
16

INTERNATIONAL
HOWARD D. LIENERT, P.E.
MANAGER,
ENVIRONMENTAL REGULATORY AFFAIRS
PAPER �cyN"9,
Ian
-teuitG// esi�, /ah 'ue
I/ R
0'14 /, i$41
ij,INTERNATIONAL PLACE II 4Pr7
n 2003 `''\
DIV. OF WATER QUALITY
DIRECTOR'S OFFICE
Mr. William G. Ross Jr., Secretary
NC Department of Environment and Natural Resources
512 N. Salisbury Street, 14th Floor
Raleigh, North Carolina 27604-1148
RE: International Paper Company Innovation Project Proposal
Roanoke Rapids & Riegelwood Mill
6400 POPLAR AVENUE &Oy\
TOWER II 05 053
MEMPHIS, TN 38197
OFFICE PHONE [phone]
CELL PHONE [phone]
FAX [phone]
e-mail: howard.lienert@ipaper
February 21, 2003
•
FEB 2 4 2003
L.
AND Nf',iuWd.'rtt��U�
REFL1MEG
REC '''E f
OFFICE OF THE SEC.`Fri°Y
r.
Dear Mr. Ross:
International Paper has been working with EPA Headquarters since February 2002 on an
innovative approach for implementing mandated regulatory requirements. Our discussions have
produced a Voluntary Superior Environmental Program concept that meets specified regulatory
program results and achieves significant additional environmental improvements that are not part
of the rule requirement. (Our proposal to EPA is contained in Attachment I.) While we are
continuing our discussions with EPA Headquarters to refine a program that could be used by
other progressive companies in the regulated community, we are at a point where we either need
to proceed with a site -by -site innovations program or lose some significant opportunities
associated with the Pulp & Paper Cluster Rule.
EPA Headquarters has recommended that we pursue with individual states and Regional EPA
offices a joint State / EPA Innovations Program at the sites that present the greatest benefit for
this new approach. We currently have a meeting scheduled with EPA Region 4 to discuss the
opportunities that exist in North Carolina, South Carolina and Mississippi on February 24`h. We
would like to schedule a meeting with you following the meeting with EPA to discuss the
specific opportunities that exist for our Roanoke Rapids and Riegelwood Mills.
Based on an evaluation of the Pine Bluff "pilot"
opportunitiesmill
believe that there are significant that exist
program approach), we for
the Roanoke Rapids and Riegelwood Mills. At Pine Bluff, our initial engineering review
identified significant potential improvement beyond what would be achieved by implementing
the Cluster Rule MACT I (high volume pulp mill source control — brown stock washer system),
MACT II (pulp and paper combustion source controls), and future Industrial Boiler MACT
Standards. Attachment II contains the Pine Bluff Innovations Program Proposal. (A detailed
listing of projected benefits is listed on the last page.)

Mr. William G. Ross Jr., Secretary
NC Department of Environment and Natural Resources
International Paper Company Roanoke Rapids & Riegelwood Mill Innovation Project Proposal
February 21, 2003
Page 2 of 2
are available with the pilot
In summary, hetfollowing major environmental improvements
proj ect at the !Pine Bluff Mill:
sixS.>?}x
HAPs (methanol & metals)
NOx
SOx
BOD
TSS
COD
Water Use
Fiber Loss
f w F
SM�i t°yzc4Z '{'�c't �:`''✓i ifs` � c'NT•..� t a �,R,xz f2 �3'.s � tzi ,.,.r
Equivalency with regulatory mandate implementation
680 TPY additional reduction
860 TPY additional reduction
5,800 lb/d additional reduction
12,600 lb/d additional reduction
20,800 lb/d additional reduction
2,089 Million Ga1yr additional reduction
3,700 TPY additional reduction
Projects that will be included in this proposal will achieve environmental compliance and
stewardship using a plant -wide, multimedia perspective rather than continued compliance on a
regulation -by -regulation, media -by -media approach. In essence, the idea is to spend capital
where it provides the best environmental return for a given site.
In order to complete the planning process and bring our project at Roanoke Rapids and
Riegelwood to the same stage as Pine Bluff, we request a one-year compliance period extension
[ref. 40 CFR 63.6(i)] for the Pulp and Paper MACT standards to allow engineers to evaluate the
potential and develop an innovation proposal for our two North Carolina Mills. The extensions
are needed to avoid irretrievable capital commitments that must be made soon on the current
Cluster Rule requirement schedule. Two standards are involved: 40.CFR 63.862 for chemical
recovery combustion sources; and 40 CFR 63.443 for pulp mill high volume, low concentration
(HVLC) gases with March 13, 2004 and April 17, 2006 compliance dates, respectively.
We believe and have shown through EPA XL projects at our Androscoggin Mill in Maine that
innovative partnerships with the regulatory and environmental community will result in superior
environmental performance for our business sites while improving cost effectiveness of pulp and
paper making processes. We would like to meet with you and appropriate members of your staff
as soon as possible to explain this request and the history of International Paper's environmental
innovation efforts.
Howard D. Lienert, P.E.
Manager, Environmental Regulatory Affairs

12/09/02
VOLUNTARY SUPERIOR ENVIRONMENTAL
PERFORMANCE (VSEP) PROGRAM
International Paper Company is seeking agreement from the U. S. Environmental Protection
Agency to approach environmental compliance and stewardship from a corporate -wide
perspective. We believe that industry, regulatory agencies, local communities and non-
governmental group stakeholders can form a partnership and enable environmental issues to be
viewed in a comprehensive manner resulting in superior environmental performance. We
propose a partnership, which will reward voluntary superior environmental performance with the
regulatory flexibility needed to achieve superior environmental gains.
Issue
The United States has been very successful in achieving improvements in the environment
through requirements for broad technologically based control systems and pollutant release
limitations. These traditional approaches are now producing diminishing environmental benefits,
transfer of pollutants between media, and ever increasing costs. To change this situation, we
must promote comprehensive approaches that consider the cross -media environmental impacts
associated with water quality, water use, air quality, climate change, solid waste, energy,
wildlife, and community socio-economic impacts. Implementation of regulatory requirements at
some locations can result in a degradation of total environmental quality when all facets of our
environment are considered. The challenge facing the United States is how to adjust and adapt
current regulatory programs for continued environmental improvement while maintaining our
competitiveness and sustainability in the global marketplace.
Opportunity exists to initiate and achieve change in the application of environmental requirements
with implementing agencies, in partnership with industry and the public, by exercising innovation
within the existing regulatory structure. A comprehensive approach to environmental
improvement will yield significant benefits beyond implementation of generic categorical
standards.
By the use of technological innovation and regulatory interpretation, it is possible to more
effectively address the compelling challenges now facing the human community: land and
ecosystem degradation, climate change, renewable energy systems, and industrial sustainability to
assist in achieving all three components of sustainable development -the economic, the social and
the environmental. While preserving the past environmental gains that have been achieved,
International Paper Company proposes to pursue mutually beneficial partnerships with
regulatory agencies, the public, and nongovernmental organizations for environmental
management and regulatory innovation to achieve those outcomes.

VSEP Program Implementation Concept
A partnershipbetweenenvironmental stakeholders has the potential to bring together what in the
past have been the competing interests of environmental improvement and industrial
sustainability. Now, more than ever, American heavy industry must compete in a global
marketplace. In recent years, American industrial strength has eroded due, in part, to the lack of
capital availability for modernization. The VSEP Program will demonstrate that common
ground can existfor environmental improvement and industrial sustainability. It is possible to
also use the silgnificant capital requirement associated with environmental improvement to
improve the cpst structure of manufacturing sites by implementing a comprehensive approach
using regulatory innovation. The VSEP Program concept is as follows:
• A corporation, company, or business site will commit to achieve superior results than those
required by specified environmental regulatory parameter control requirements and to
achieve additional improvements in other environmental aspects such as energy use, water
use, solid waste generation, hazardous waste generation, and habitat improvement. Sites
proposed by a corporation must be enrolled in EPA's Performance Track Program or commit
to meeting application conditions and submitting an application within six months of entry to
the VSEP 'program. (Note: IP's requirement for facilities to be in the Performance Track program shows
our strong commitment to compliance and environmental excellence. The evaluation for inclusion in the VSEP
Program can be an ongoing activity by industry as new regulations such as the Industrial Boiler MACT are
promulgated.)
• If the corporation, company, or business site proposes a particular site for inclusion in the
VSEP Program and more time is required to complete the planning and development for the
alternate site project(s), then EPA, after consultation with the affected State agency, will
request the State give positive consideration to an extension request similar in form to 40
CFR 63.6(i) of the Clean Air Act regulations.
• During the initial regulatory extension, each International Paper business site proposed for
inclusion the VSEP Program will develop a schedule of potential projects to achieve
superior environmental performance. Upon validation by the site stakeholder group,
regulatory interpretation by EPA will be extended to accommodate changes in the time
necessary to complete the stakeholder VSEP project review process.
• If the application to the VSEP program is submitted by a corporation and includes multiple
business sites, only those sites identified in the application are eligible for the additional
regulatory extension. Should a proposed site not achieve the VSEP entry qualifications, the
site will be required to meet the end date for compliance with the applicable regulation. (Note:
For IP, this would be the alternate date provided by the one-year program development extension.)
in the VSEP program maybe
• A portion Hof any capital savings realized through participationp gr
eligible for use on additional regulated or non- regulated pollutant prevention, energy, water,
materials use reduction, or habitat improvement projects. The portion may be expended at the
site where savings are incurred or elsewhere among other VSEP sites if greater advantage can be
captured. The projects chosen shall closely parallel those defined as "aspects" in EPA's
Performance Track application and be judged by affected stakeholders to be mutually beneficial
to business and environmental sustainability.

VSEP Program Regulatory Interpretation
A key component for success of the VSEP Program is regulatory interpretation. The programs
success will Binge on EPA and State Agency ability to provide for interpretations such as those
listed below:
• Alternate compliance schedules where promulgated regulations are being implemented. At a
minimum, an allowance similar to the one-year extension under 40 CFR 63.6(i) of the Clean
Air Act regulations, or a separate subcategory designation as EPA provided Georgia Pacific
for black liquor gasification is necessary for development of alternate project implementation
schedule(s).
• Ability to implement environmentally beneficial changes with corresponding permit changes
that meet project schedules.
• The use of a plant -wide applicability limit (PAL) permit where beneficial projects can be
implemented as part of normal business so long as no permit emission limitation is exceeded.
• Ability to'perform maintenance, re -build equipment, and improve process and energy
efficiency.
• Ability to implement tailored monitoring approaches sufficient to demonstrate site -specific
compliance assurance with appropriate record keeping and reporting to assure reductions are
permanent and verifiable.
• Ability to achieve environmental improvements comparable to promulgated regulatory
expectations such as the MACT emission levels through control of alternative sources, and
bubbling across MACT source categorical requirements. This includes the banking of
emission reductions for future new regulatory requirements such as the proposed Industrial
Boiler MACT Standards.

VSEP Program Scope
To qualify for inclusion in the VSEP Program, specified sites would achieve environmental
improvements comparable with the specified regulations as well as agree to pursue further
aggregate achievements over a 10-year period as shown in the following table:
Improvement
Reduction/Improvement Goal 1
Air Quality (e.g. PM, NOx, SO2, TRS, or CO)
20% in one or more parameters
Wastewater Discharge or Influent Wastewater Treatment
Loading (e.g. BOD, COD, TSS, or Nutrients)
20% in one or more parameters
Energy (Fossil Fuel Use)
>10%
Climate Change (CO2 & Methane)
>10%
Water Use
>10%
Solid Waste Generation
>10%
Raw Material Use (Fiber Loss)
>10%
Wildlife Habitat
Provide wildlife habitat enhancements with conservation
easement for acreage to be determined on a site specific basis
' These are preliminary goals (+/- 50%) for discussion purpose on y. Further technical evaluation is required to finalize. At this
initial stage in the process, these company -wide goals are identified for discussion purposes only. Any commitment to
company -wide goals is conditioned upon the execution of a VSEP agreement, or other mechanism, which is acceptable to
both International Paper Company and the U.S. EPA.
While not all sites offer equal opportunities, the following table illustrates what might be
achievable at the sites that International Paper would propose for inclusion in the VSEP program.
What, if any, of those areas would be pursued would be contingent upon the detailed technical
evaluations and input from the stakeholder engagement process. In the aggregate, the extent to
which additional improvement opportunities might be realized by VSEP sites company -wide
would be similarly dependent.

INTERNATIONAL
PAPER
ENVIRONMENTAL INNOVATION PROGRAM PROPOSAL
PINE BLUFF MILL, PINE BLUFF, ARKANSAS
January 31, 2003
Objective of Proposal
The proposal requests regulatory flexibility needed to allow International Paper's pulp and paper
mill in Pine Bluff Arkansas an innovative approach to meeting Pulp and Paper MACT
(Maximum Achievable Control Technology), expected Boiler MACT and mill -specific fiber
pond closure regulatory requirements. The proposed approach will achieve parity with MACT
standards in hazardous air pollutant (HAP) emissions reductions at reduced cost. Cost savings
will allow P rolects to reduce water use and relieve pressure on critical groundwater resources of
paramount concern to the Pine Bluff community. In this way, the proposal provides superior
environmental improvement tailored to the specific needs of the community.
Proposal elements include:
• Cost effective control of unregulated emissions units (e.g., BLOx vent and other source
reduction efforts) in lieu of dilute, expensive -to -control pulp mill vents (e.g., Brown Stock
Washer aid other HVLC vents) regulated by the Pulp and Paper MACT;
• Beyond-MACT control of regulated, HAP -bearing, process condensates that also reduce
BSW emissions;
• Creating source -wide emissions limits among boilers and chemical recovery combustion
units subject to MACT standards;
• Increasing energy efficiency of a biomass fired boiler, shutting down a fossil fuel fired boiler,
and limiting another fossil fuel fired boiler, all of which are regulated by the boiler MACT;
• Reducing unregulated raw water use by increasing process water recycle and demand
reduction;
• Creating a wetlands -based water treatment system and wildlife habitat, rather than applying
an engineered cover and restricting access to an existing fiber pond; and
• Segregating storm water from process waters and permitting storm water outfalls to reduce
loading and allow efficiency improvements to the existing wastewater treatment system.

Expected Benefits
Emissions of hazardous air pollutants (HAP) will be reduced from the site by an amount at least
as great as is required by applicable MACT standards. More importantly, emissions increases of
criteria pollutants and carbon dioxide from typical MACT control strategies will be avoided and
improvement in combustion efficiency in the bark boiler, decreased use of fossil fuels and
increased use ,of biomass fuels will net large decreases in criteria pollutant emissions. The
discharge of thousands of pounds per day of wastewater pollutants (BOD, COD, TSS) and
generation of thousands of tons per year of solid waste will be eliminated. Reduced raw water
use at the mil will relieve pressured ground water resources in the Pine Bluff vicinity and
provide on the order of 6 million gallons per day of additional supply for community expansion.
At the same time, a 54-acre basin will be restored to wetlands and wildlife habitat. The
innovative approach is projected to reduce operating costs for controls and may save 5 million
dollars in capital cost, while still providing superior environmental performance.
The net effect of the innovations project is to achieve parity -plus with MACT standards through
innovative HAP reduction strategies and use resulting cost savings to serve more acute
community interests. Attached Table 1 quantifies projected net benefits for the innovations
proposal v conventional controls that would be required in the absence of the proposed
innovations project.
Regulatory Change
To implement this proposal, regulatory flexibility is required to create Title V and NPDES
permit limits that:
• Ensure over -control of process condensates currently regulated by pulp and paper MACT
requirements [ref. 40 CFR 63.446];
• Restrict unregulated process condensate use and resulting emissions from brown stock
washer (BSW), knotter, screen, and decker systems;
• Control the unregulated black liquor oxidation system (BLOx) tank vent via combustion in
the No. 2 and 3 recovery furnaces in place of venting the BSW, knotter, screen, decker and
oxygen delignification systems vents to a regenerative thermal oxidizer (RTO) as is required
by April 2006 [ref. 40 CFR 63.443];
• Establish a single "bubble" limit from the Nos. 1 and 2 recovery furnaces, the Nos. 1 and 2
boilers and the bark boiler that limits metal -HAP emissions to the level required by the Pulp
and Paper and proposed Boiler MACTs [ref. 40 CFR 63.862 and the proposed Boiler
MACT];

• Enable combustion modifications to be made to the bark boiler and Nos. 1 and 2 recovery
furnaces, allow for maintenance, rebuilding equipment, and improving process and energy
efficiency using an actual -to -actual new source review applicability assessment and therefore
not triggering NSR;
• Establish a plant -wide applicability limitation (PAL) as appropriate to allow beneficial
projects to be implemented without permit changes so long as PAL limits are not exceeded;
• Allow flexibility to implement practical monitoring techniques in a manner to achieve site -
specific compliance assurance with appropriate record -keeping and reporting;
Flexibility and timeliness is also needed in the administration of water use, water discharge and
solid waste permits to allow reductions in raw water usage, creation of a wetlands -based
treatment system, segregation of storm water from process wastewater and reconfiguration of the
existing aerated stabilization basin treatment system to accommodate lower flow at higher
efficiency.
Also needed are one-year compliance period extensions [ref. 40 CFR 63.6(i)] for the Pulp and
Paper MACT standards to allow engineers currently engaged with traditional MACT compliance
to shift efforts to the innovative proposal solutions. Two standards are involved 40.CFR 63.862
for chemical recovery combustion sources and 40 CFR 63.443 for pulp mill high volume, low
concentration (HVLC) gases with March 13, 2004 and April 17, 2006 compliance dates,
respectively.
As part of the ECOS project development, International Paper intends to establish alternate
compliance schedules for individual innovations proposal project elements.
Principles in Agreement
The proposal fits well within the innovations project acceptance criteria in the Joint EPA/State
Agreement to Pursue Regulatory Innovation. Overall superior environmental performance will
be achieved. Emissions reductions inherent in applicable standards will be achieved, but in a
more flexible and cost effective manner. Most importantly, the specific needs of the community
(groundwater availability) will be addressed directly. In brief, the Innovations Proposal allows
International Paper to expend capital where it will best serve the community.
The elements of the Innovations Proposal are discussed in the following side -by -side
comparison.

INNOVATIONS PROPOSAL
CONVENTIONAL CONTROLS
Experimentation
No innovation. Add -on controls result in increased
use of fossil fuels, associated secondary criteria
pollutants, and increased water use, which runs
directly counter to community needs.
The innovations proposal breaks new ground with a site-
specific, mill -wide, multimedia pollutant reduction
approach to match environmental expenditures to the
specific needs of the community. The technologies
proposed are practical and non -experimental. The risk
is whether or not sufficient regulatory flexibility can be
provided to accommodate the practical technologies
within the time and resource constraints of the projects.
Project Elements
1. Collect 11.1 lb methanol per ton pulp in process
condensates
2. Combust dilute pulp mill vents in RTO using
1. Over -collection of process condensates amounting
to about 13.51b methanol per ton of pulp with
associated reduction in HAPs from pulp mill vents
2. Control HAP emissions from BLOx vent in Nos. 1
and 2 recovery furnaces with no fossil fuel use;
modify furnaces to improve air handling, overall
fossil fuels; no change to recovery furnace
operations
3. Add to bark boiler an ESP or fabric filter and
possibly a wet scrubber or carbon injection
4. No change in operation of Nos. 1 and 2 fossil fuel
boilers with a combined allowable heat input of
7.9 trillion BTUs per year heat input
5. No change
6. Small increase in process water use and
groundwater withdrawal rates due to additional
scrubbers
7. Close the No. 2 fiber pond by applying an
engineered cover and restricting future use
8. No change in current operations
combustion and chemical recovery efficiency
3. Increase bark lioiler combustion efficiency and
biomass firing by adding over -fire air, a sludge
metering moisture control system and improved fuel
distribution system
4. Shut -down No. 2 fossil fuel boiler and restrict use of
No. 1 fossil fuel boiler to 3.5 trillion BTUs per year
heat input
5. Improve No. 2 paper machine broke overflow
collection system to decrease fiber loss and virgin
fiber use by about 0.5 percent and reduce associated
solid waste disposal by 3,700 tons per year
6. Recycle 3 to 10 million gallons per day of process
white water with associated reduction in
groundwater withdrawal rate
7. Close the No. 2 fiber pond by creating a wetlands
wastewater treatment system and wildlife habitat
8. Storm water segregation and waste treatment system
optimization projects with associated increase in
wastewater treatment efficiencies.
Environmental Performance
See Table 1.
The Innovations Proposal provides parity with
conventional controls in HAP emissions, large
reductions in criteria pollutant and carbon dioxide
emissions and significant improvement in water
resource management, which is the most important
environmental issue in the community. Table 1
provides a projected comparison of the innovations
proposal versus conventional controls for all relevant
environmental parameters.

0
Smarter Approaches
No advantage
The innovations proposal applies resources where they
will best serve the environment in the Pine Bluff
community, while still achieving the level of HAP
emissions reductions required by MACT standards.
Measuring and Verifying Results
Conventional MACT controls would result in equal or
less reduction in HAP emissions.
Emissions of HAP (regulated
Boiler MACTs and
primary criteria. Success
1. HAP emissions
proposal projects
from conventional
2. net reduction in
emissions, and
3. net reduction in
by the Pulp and Paper and
raw water usage at the mill are the
will be determined by:
reductions from the innovations
that equal or exceed reductions
MACT controls,
criteria pollutant and carbon dioxide
raw water usage.
Accountability/Enforcement
Compliance with MACT standards would be
determined as specified in individual MACT
standards.
The mill will be held
demonstrated through
through Title V permit
• 13.51b methanol
condensates to
>121b methanol
• Metal -HAP and
2 recovery furnaces,
and the bark boiler
cannot exceed the
allowed by the
Boiler MAC4
conducted consistent
requirements or
acceptable by ADEQ,
• Other restrictions
engineering analysis
to equivalent HAP control as
engineering analysis and ensured
limits that require as appropriate:
per ton of pulp in process
be collected and treated to destroy
per ton of pulp,
HCl emissions limits for Nos. 1 and
Nos. 1 and 2 fossil fuel boilers
set at a rates that in aggregate
lb per hour emissions rate
Pulp and Paper (MALT II) and
Testing and monitoring will be
with Pulp and Paper MACT
an alternative method found
and
if determined necessary through
to achieve parity.
criteria and carbon dioxide
water usage will be determined
analysis. Changes in storm water
wastewater treatment systems and
for the No. 2 fiber pond will be
in AR NPDES and solid waste
The net reduction in
emissions and raw
through engineering
discharge patterns,
closure requirements
captured as appropriate
permits.
State -EPA Partnership
EPA is afforded opportunity to comment on Title V
and NPDES permits during established review
procedures.
Primary interaction'Iwith International Paper will be the
responsibility of ADEQ. EPA will be provided key
project documents as they become available (if desired),
invited to participate in stakeholder meetings, and
afforded full procedural review through the Title V and
NPDES process.

w,
•
Legal Effect of the Proposal
This Proposal states the intentions of International Paper and the State of Arkansas with respect
to our innovations proposal. The Parties have stated their intentions seriously and in good faith,
and expect to carry out their stated intentions.
This Proposal in itself does not create or modify legal rights or obligations and is not a contract
or a regulatory action, such as a permit or rule, and is not legally binding or enforceable against
any of the Project Signatories. Rather, it expresses the plans and intentions of the Project
withoutmakin thoseplans and intentions bindingrequirements. This applies to the
Signatories g �
provisions of this Proposal that concern procedural as well as substantive matters. While the
Parties fully intend to adhere to these procedures, they are not legally obligated to do so.

TABLE 1. PINE BLUFF MILL INNOVATIONS PROPOSAL
ENVIRONMENTAL BENEFITS1
Conventional Controls`
Proposed Pine Bluff Mill
Innovations Projects
Net Benefit of Proposed
Innovations Projects Over
Conventional Controls
Parameter
Release or Impact
Release or Impact
Release or Impact
Air
Methanol
151 TPY Reduction
>151 TPY Reduction
Un-quantified Reduction
Metal HAPs
None (Multiple Unit Avg Approach)
Un-quantified Reduction
Un-quantified Reduction
SO.
61 TPY Increase
619 TPY Reduction
680 TPY Reduction
NO.
Un-quantified Increase
876 TPY Reduction
876 TPY Reduction
TSP
24 TPY Reduction
44 TPY Reduction
20 TPY Reduction
TRS (as H2S)
33 TPY Reduction
103 TPY Reduction
70 TPY Reduction
CO
Un-quantified Increase
84 TPY Reduction
84 TPY Reduction
CO2
1,728 TPY Increase
Un-quantified Reduction
Un-quantified
CH4
NA
Un-quantified Reduction
Un-quantified Reduction
VOC
471.1 TPY Reduction
450.4 TPY Reduction
20.7 TPY Increase
Water
BOD
NA
5,800 lb/d Reduction
5,800 ib/d Reduction
TSS
NA
12,600 lb/d Reduction
12,600 lb/d Reduction
COD
NA
20,800 lb/d Reduction
20,800 lb/d Reduction
Total Nitrogen
NA
290 lb/d Reduction
290 lb/d Reduction
Total Phosphorus
NA
58 lb/d Reduction
58 lb/d Reduction
Color
NA
NA
NA
Chloroform
NA
NA
NA
Chlorophenolics
NA
NA
NA
AOX
NA
NA
NA
Water Use
Un-quantified Increase
2,089 MM gal/yr Reduction
2,089 MM gal/yr Reduction
Solid Waste
WWT Sludge
NA
Un-quantified Reduction
Un-quantified Reduction
Landfill Reduction
NA
Un-quantified Reduction
Un-quantified Reduction
Fiber Recovery
NA
3,700 TPY Reduction
3,700 TPY Reduction
• Other
Wildlife Benefits
No Change
54 Acre Increase
54 Acre Increase
Community Benefits
Reduced Odor
Reduced Odor; Water & Air
Quality Improvement; Increased
Wildlife Habitat; Aquifer Use
Reduction
Increased Odor Reduction; Water
& Air Quality Improvement;
Increased Wildlife Habitat; Aquifer
Use Reduction
Capital Costs
$19.75 MM
$14.5 MM
$5.25 MM Reduction
O&M Costs
> $0.42 MM
To be determined
To be determined
' This table the net environmental benefits of the innovations proposal alternate projects in comparison the conventional controls that would have
to be built if the innovations proposal is not accepted.
2 Conventional Regulatory Program Requirements including Cluster Rule MACT 1 Phase II, MACT II, Industrial Boiler MACT & Fiber Pond
Closure)

a -
INTERNATIONAL
HOWARD D. LIENERT, P.E.
MANAGER,
ENVIRONMENTAL REGULATORY AFFAIRS
PAPER
Ms. Elizabeth Shaw (1807T)
Director, Office of Environmental Policy Innovation (OEPI)
US Environmental Protection Agency
Room 4104 "A"
1301 Constitution Ave. N.W.
Washington, D.C. 20004
INTERNATIONAL PLACE 1I
6400 POPLAR AVENUE
TOWER I105 053
MEMPHIS, TN 38197
OFFICE PHONE [phone]
CELL PHONE [phone]
FAX [phone]
e-mail: howard.lienert@lpapercom
December 9, 2002
RE: International Paper Environmental Innovation Proposal
Concept Document for a Voluntary Superior Environmental Performance Program
Dear Betsy:
Thank you for your comments on our concept document for a Voluntary Superior Environmental
Performance (VSEP) Program dated November 4, 2002. We have been evaluating your
comments for inclusion of specific program goals and to limit the initial program to mill sites
that have the greatest potential for improvements in environmental aspects. The attached VSEP
Concept Document has been revised to address these issues.
The revision in the proposed VSEP Program goals is based on our preliminary assessment of the
potential benefits associated with the work performed at our Pine Bluff Mill. The goals represent
a generalized analysis for environmental aspects improvement potential at our other mills with
similar ClusterRule MACT I, Phase II systems (brown stock washer control requirements and
black liquor recovery furnace operations) and future standards (e.g., Industrial Boiler MACT
Standards).
The program goals proposed for discussion are shown in the following table. It is necessary to
realize that as we work towards finalizing a VSEP Program, we will initiate a significant
technical analysis that can be expected to determine the extent to which to these initially
proposed goals may be met.
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. _
Air Quality (e.g. PM, NOx, SO2, TRS, or CO)
20 % in one or more parameters
Wastewater Discharge or Influent Wastewater Treatment
Loading (e.g. BOD, COD, TSS, or Nutrients)
20 % in one or more parameters
Energy (Fossil Fuel Use)
>10 %
Climate Change (CO2 & Methane)
>10 %
Water Use
>10 %
Solid Waste Generation
>10 %
Raw Material Use (Fiber Loss)
>10 %
Wildlife Habitat
Provide wildlife habitat enhancements with conservation
easement for acreage to be determined on a site specific basis
1 These are preliminary goals (+/- 50%) for discussion purpose only. Further technical evaluation is required to finalize. At
this initial stage in Ithe process, these company -wide goals are identified for discussion purposes only. Any
commitment to company -wide goals is conditioned upon the execution of a VSEP agreement, or other mechanism,
which is acceptable to both International Paper Company and the U.S. EPA.

Ms. Elizabeth Shaw
US Environmental Protection Agency
International Paper Environmental Innovation Proposal Concept Document
December 9, 2002
Page 2 of 2
We believe a1126 of our pulp and paper mills would have significant opportunities and could be
considered for participation in a VSEP Program. Because of our respective resource limitations
and demonstration character of this initiative, International Paper proposes to carry out a
screening of those 26 mills. Screening results will lead to the identification of the 10 most
favorable sites that will be subject to a more intensive engineering evaluation. At the conclusion
of those studies, EPA and International Paper will collaboratively review the continued
candidacy of the mills for VSEP status. A decision to proceed on mills will be based upon the
technical, environmental and economic analysis of the comparative benefits associated with
achieving the jtarget goals.
To enable International Paper to continue our VSEP Program development efforts, we need
EPA's assistance with the current Cluster Rule compliance schedule. We currently have
committed company technical resources to meet the impending compliance date for the MACT I,
Phase II (40 CFR 63.443) - Pulp Mill High Volume, Low Concentration (HVLC) Gas Control,
April 17, 2006. Due to the long lead-time required for fabrication of the control system
components, engineering has been initiated and significant capital commitments will be made
during the first quarter of 2003. Our 2003 MACT I, Phase II compliance capital spending
projection is $60 million. Given this level of capital commitment, it is critical for International
Paper to obtain a 1-year compliance extension if we are to continue our efforts for improving the
environmental benefits associated with capital allocations under a VSEP Program.
With a one-year extension, International Paper will commit the technical resources to further our
discussion for a VSEP Program that has broad industrial applicability. Our projected costs for
the detailed technical evaluation of candidates for the VSEP Program in 2003 will be
approximately $2 million.
As expressed in our November 4, 2002 letter, we believe that we have developed an innovation
proposal that will have strong support among regulatory agencies, environmental and industrial
groups. The proposal is an evolutionary step not only towards U.S. paper industry sustainability
but any industrial sector that commits to superior environmental performance. We believe it is
possible to achieve superior environmental results through more cost effective alternatives to
broad industrial sector regulatory mandates.
Thank you again for the opportunity to move ahead on this exciting effort.
Sin erely,
Howard D. Lienert
cc: Ms. Kristina Heinemann — Office of environmental Policy Innovation, U.S. EPA
Dr. Richard B. Phillips — Sr. VP Technology
Mr. Thomas C. Jorling — VP, Environment, Health & Safety
Mr. Duane W. Marshall — Director, Corporate Environment
Mr. Steve Groves — Senior Program Manager, Corporate Environment
Attachment
Innovation Concept 12-09-02.doc

12/09/02
VOLUNTARY SUPERIOR ENVIRONMENTAL
PERFORMANCE (VSEP) PROGRAM
International Paper Company is seeking agreement from the U. S. Environmental Protection
Agency to approach environmental compliance and stewardship from a corporate -wide
perspective. We believe that industry, regulatory agencies, local communities and non-
governmental group stakeholders can form a partnership and enable environmental issues to be
viewed in a comprehensive manner resulting in superior environmental performance. We propose
a partnership, which will reward voluntary superior environmental performance with the regulatory
flexibility needed to achieve superior environmental gains.
Issue
The United States has been very successful in achieving improvements in the environment through
requirements for broad technologically based control systems and pollutant release limitations.
These traditional approaches are now producing diminishing environmental benefits, transfer of
pollutants between media, and ever increasing costs. To change this situation we must promote
comprehensive approaches that consider the cross -media environmental impacts associated with
water quality, water use, air quality, climate change, solid waste, energy, wildlife, and community
socio-economic impacts. Implementation of regulatory requirements at some locations can result
in a degradation of total environmental quality when all facets of our environment are considered.
The challenge facing the United States is how to adjust and adapt current regulatory programs for
continued environmental improvement while maintaining our competitiveness and sustainability in
the global marketplace.
Opportunity exists to initiate and achieve change in the application of environmental requirements
with implementing agencies, in partnership with industry and the public, by exercising innovation
within the existing regulatory structure. A comprehensive approach to environmental
improvement will yield significant benefits beyond implementation of generic categorical
standards.
By the use of technological innovation and regulatory interpretation, it is possible to more
effectively address the compelling challenges now facing the human community: land and
ecosystem degradation, climate change, renewable energy systems, and industrial sustainability to
assist in achieving all three components of sustainable development -the economic, the social and
the environmental. While preserving the past environmental gains that have been achieved,
International Paper Company proposes to pursue mutually beneficial partnerships with
regulatory agncies, the public, and nongovernmental organizations for environmental
management and regulatory innovation to achieve those outcomes.
1

12/09/02
VSEP Program Implementation Concept
A partnership between environmental stakeholders has the potential to bring together, what in the
past have been the competing interests of environmental improvement and industrial
sustainability. Now, more than ever, American heavy industry must compete in a global
marketplace. In recent years, American industrial strength has eroded due, in part, to the lack of
capital availability for modernization. The VSEP Program will demonstrate that common
ground can exist for environmental improvement and industrial sustainability. It is possible to
use the signifipant capital requirement associated with environmental improvement to improve
the cost structure of manufacturing sites by implementing a comprehensive approach using
regulatory innovation. The VSEP Program concept is as follows:
• A corporation, company, or business site will commit to achieve superior results than those
required by specified environmental regulatory parameter control requirements and to
achieve additional improvements in other environmental aspects such as energy use, water
use, solid waste generation, hazardous waste generation, and habitat improvement. Sites
proposed by a corporation must be enrolled in EPA's Performance Track Program or commit
to meeting application conditions and submitting an application within six months of entry to
the VSEP program. (Note: IP's requirement for facilities to be in the Performance Track program shows
our strong co II 'tment to compliance and environmental excellence. The evaluation for inclusion in the VSEP
Program can • e an ongoing activity by industry as new regulations such as the Industrial Boiler MACT are
promulgated.)
• If the corporation, company, or business site proposes a particular site for inclusion in the
VSEP Program and more time is required to complete the planning and development for the
alternate site project(s), then EPA, after consultation with the affected State agency will
request the State give positive consideration to an extension request similar in form to 40
CFR 63.6(i) of the Clean Air Act regulations.
• During the initial regulatory extension, each International Paper business site proposed for
inclusion in the VSEP Program will develop a schedule of potential projects to achieve
superior environmental performance. Upon validation by the site stakeholder group,
regulatory interpretation by EPA will be extended to accommodate changes in the time
necessary to complete the stakeholder VSEP project review process.
• If the application to the VSEP program is submitted by a corporation and includes multiple
business sites, only those sites identified in the application are eligible for the additional
regulatory extension. Should a proposed site not achieve the VSEP entry qualifications, the
site will be required to meet the end date for compliance with the applicable regulation. (Note:
For IP, this would be the alternate date provided by the one year program development extension.)
• A portion of any capital savings realized through participation in the VSEP program may be
eligible for use on additional regulated or non- regulated pollutant prevention, energy, water,
materials use reduction, or habitat improvement projects. The portion may be expended at
the site where savings are incurred or elsewhere among other VSEP sites if greater advantage
can be captured. The projects chosen shall closely parallel those defined as "aspects" in
EPA's Performance Track application and be judged by affected stakeholders to be mutually
beneficial to business and environmental sustainability.
2

12/09/02
VSEP Program Regulatory Interpretation
A key component for success of the VSEP Program is regulatory interpretation. The programs
success will Binge on EPA and State Agency ability to provide for interpretations such as those
listed below:
• Alternate compliance schedules where promulgated regulations are being implemented. At a
minimum, an allowance similar to the one-year extension under 40 CFR 63.6(i) of the Clean
Air Act regulations, or a separate subcategory designation as EPA provided Georgia Pacific
for black liquor gasification is necessary for development of alternate project implementation
schedule(s).
• Ability to implement environmentally beneficial changes with corresponding permit changes
that meet project schedules.
• The use of a plant -wide applicability limit (PAL) permit where beneficial projects can be
implemented as part of normal business so long as no permit emission limitation is exceeded.
• Ability to ;perform maintenance, re -build equipment, and improve process and energy
efficiency:
• Ability to implement tailored monitoring approaches sufficient to demonstrate site -specific
compliance assurance with appropriate record keeping and reporting to assure reductions are
permanenn and verifiable.
• Ability to achieve environmental improvements comparable to promulgated regulatory
expectations such as the MACT emission levels through control of alternative sources, and
bubbling across MACT source categorical requirements. This includes the banking of
emission reductions for future new regulatory requirements such as the proposed Industrial
Boiler MACT Standards.
VSEP Program Scope
To qualify for inclusion in the VSEP Program, specified sites would achieve environmental
improvements comparable with the specified regulations as well as agree to pursue further
aggregate achievements over a 10-year period as shown in the following table:
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__, c '' :_.. ,.., a, r ,.:.M . - x•
...`` : t'iSi -��.. ,r. ,p , •�t ?.L s � � .�* r
i � �—�: M.. � i . t;�' ja'r
1. • t s. r { .
NOx, SO2, TRS, or CO)
,�-��
v,i. r�'`i
t.'k. ;
� his
�. -tt. 's. ,,,j pt� a, .< ,,� ;-•n.:*�fy .L�.Ys f
t i ?+< .49 `X1. "' r .� :' -a,- _M
M
'Z�[.,
}� skF •1 1 - d� unman e r 'T
� ` 'a
' `' t. w� i°�' .elat. ti .-i'
20 % in one or more parameters
Air Quality (e.g. PM,
Wastewater Discharge
Loading (e.g. BOD,
or Influent Wastewater Treatment
o
20 /o in one or more parameters
COD, TSS, or Nutrients)
Energy (Fossil Fuel Use)
>10 %
Climate Change (CO2 & Methane)
>10 %
Water Use
>10 %
Solid Waste Generation
>10 %
Raw Material Use (Fiber Loss)
>10 %
Wildlife Habitat
Provide wildlife habitat enhancements with conservation
easement for acreage to be determined on a site specific basis
I These are preliminary goals (+I 50%) for discussion purpose only. Further technical evaluation is required to finalize. At this
initial stage in the process, these company -wide goals are identified for discussion purposes only. Any commitment to
company -wide goals is conditioned upon the execution of a VSEP agreement, or other mechanism, which is acceptable to
both International Paper Company and the U.S. EPA.
3

12/09/02
While not all sites offer equal opportunities, the following table illustrates what might be
achievable at the sites that International Paper would propose for inclusion in the VSEP program.
What, if any, of those areas would be pursued would be contingent upon the detailed technical
evaluations and input from the stakeholder engagement process. In the aggregate, the extent to
which additional improvement opportunities might be realized by VSEP sites company -wide
would be similarly dependent.
A preliminary analysis of an International Paper mill indicates the following potential gains for a
VSEP Program.
Parameter.
Combined Aspects of Cluster
Rule MACT I Phase II
Requirements
Release or Impact
Combined Aspects of
Potential Mill Projects
Release or Impact
Net Benefit of Implementing
Potential Mill Projects in Lieu
of Cluster Rule MACTI Phase
ll Requirements
Release or Impact
Air
Methanol
151.1 TPY Reduction
Equivalency
To Be Determined
Metal HAPs
None (Mult. Unit Avg. Approach)
Unquantified Reduction
Unquantified Reduction
SOx
Unquantified increase
558 TPY Reduction
619 TPY Reduction
NOx
Unquantified Increase
876 TPY Reduction
876 TPY Reduction
TSP
Unquantified Increase
21 TPY Reduction
Unquantified Reduction
TRS (as H2S)
32.7 TPY Reduction
102.9 TPY Reduction
70.2 TPY Reduction
CO
Unquantified Increase
84.1 TPY Reduction
84.1 TPY Reduction
CO2
1,728.0 TPY Increase
Unquantified Reduction
Unquantified
CH4
NA
Unquantified Reduction
Unquantified Reduction
VOC
471.1 TPY Reduction
450.4 TPY Reduction
20.7 TPY Increase
Water
BOD
NA 5,800 lb/d Reduction
5,800 lb/d Reduction
TSS
NA 12,600 lb/d Reduction
12,600 lb/d Reduction
COD
NA 20,800 lb/d Reduction
20,800 lb/d Reduction
Total Nitrogen
NA 290 lb/d Reduction
290 lb/d Reduction
Total Phosphorus
NA 58 lb/d Reduction
58 lb/d Reduction
Color
NA NA
NA
Chloroform
NA NA
NA
Chlorophenolics
NA NA
NA
AOX
NA NA
NA
Recycle/Reduction
Water Use Increase 2,089 MM gal/yr Reduction
2,089 MM gal/yr Reduction
Solid Waste
WWT Sludge
NA
Unquantified Reduction
Unquantified Reduction
Landfill Reduction
NA
Unquantified Reduction
Unquantified Reduction
Fiber Recovery
NA
3,700 TPY Reduction
3,700 TPY Reduction
Other
Wildlife Benefits
No Change
No Change
No Change
Community Benefits
Reduced Odor
Reduced Odor; Water & Air
Quality Improvement; Increased
Wildlife Habitat; Aquifer Use
Reduction
Increased Odor Reduction;
Water & Air Quality
Improvement; Increased
Wildlife Habitat; Aquifer Use
Reduction
4