Regulation of Petcoke in Chicago

1. Regulation of Petcoke in Chicago Dave Graham and Jennifer Hesse February 18, 2015

2. What is Petcoke? • Petroleum Coke, or “petcoke,” is a solid, carbon material derived as a byproduct of the oil refining process. • Petcoke is typically used as a fuel source in power plants and cement kilns.

3. Why has petcoke been in the news? • On August 30, 2013, a resident posted a photo on Facebook showing a cloud of black dust. • At the end of 2013, BP completed the expansion of its refinery in Whiting, IN, resulting in a massive influx of petcoke on Chicago’s southeast side.

4. Where is petcoke stored? • KCBX Terminals Company has two sites along the Calumet River with outdoor storage piles. • The Beemsterboer family also had two sites, which have since shut down. • A small amount of petcoke is also stored at Horsehead, Corp., for use in their manufacturing process KCBX South – 10730 S. Burley

5. What are the health impactsof petcoke? • Breathing any dust, whether from petcoke, coal, or other materials, can cause short-term health impacts such as coughing, wheezing or shortness of breath. Dust can also aggravate respiratory conditions, such as asthma. • There are no other known illnesses associated with exposure to petcoke, according to a report issued by the U.S. Environmental Protection Agency (EPA), based on available scientific data.

6. How did the City respond to public concern? • Increased inspections • Issued a public call asking residents to report petcoke issues through 311 or by email • Filed a lawsuit with the State Attorney General against one of the facilities (Beemsterboer), resulting in the removal of all petcoke from the site • Created Rules and Regulations for Bulk Solid Materials • Passed an ordinance to ban new petcoke transfer facilities & require quarterly reporting from existing facilities

7. Why did CDPH issue Regulations? • CDPH enforces the Environmental Code and regulates facilities that impact the environment. • Previously, there were no specific rules for facilities handling dusty bulk materials. • The purpose of the regulations is to protect public health and the environment by minimizing emissions of airborne particulate matter.

8. Public Process • Proposed rules were posted and opened for public comment on December 19, 2013 • CDPH received verbal comments at a special public community hearing held on January 14, 2014 • After an extended 50-day comment period, CDPH received written comments from 60+ individuals and organizations, totaling approx. 1600 pgs

9. What do the Regulations require? • Full enclosure of petcoke and coal within 2 years, plus stringent dust control measures in the interim • Prohibition on visible dust beyond the property line and opacity limit within the site • Submission of a Fugitive Dust Plan describing dust control measures at all facilities • Continuous dust monitoring around all facilities • Other best management practices to control dust

10. What is required for full enclosure? • Coke and coal must be entirely surrounded by a completely roofed and walled structure • Must be designed, permitted and constructed in accordance with the Building Code

11. When are outdoor piles allowed? • Coke and coal may be stored outdoors while the enclosure is being constructed, subject to an Interim Fugitive Dust Plan • Non-coke and coal materials may be stored outside subject to all the requirements set forth in the regulations

12. How will outdoor piles be controlled? • The piles may not be higher than 30 feet • The piles must be sprayed with water or other dust suppressants as needed • Piles may not be disturbed during high wind conditions without effective controls

13. Other requirements forboth indoor & outdoor sites • All conveyors must be covered or enclosed • All transfer points must be controlled • Must follow an approved Dust Control Plan

14. More requirements tokeep neighborhoods clean • Vehicles must be tarped • Facility roads must be paved • Trucks must be cleaned • Stormwater runoff must be managed • Surrounding streets must be swept

15. How can we be sure the controlsare working? • Facility must install and maintain real-time dust monitors with a data logger to record all readings • Facilities must test visible dust and opacity on a quarterly basis • City will conduct random, unannounced inspections

16. When do the rules take effect? • Immediately (3/13/14): Ban on fugitive dust; roadway cleaning & housekeeping, recordkeeping, monthly enclosure reports • 90 days (6/11/14): Dust plan, enclosure plan, dust monitoring, wind monitoring, vehicle covering, etc. • Six months (9/13/14): Covered conveyors • One Year (3/13/15): Paved facility roads • Two Years from submission of Enclosure Plan (6/9/16): Construction of buildings

17. What if a facility does not comply? • Violators can be fined $1,000 - $5,000 per day for any air pollution violation • Repeat violators are subject to additional enforcement, including shut-down of operations

18. What if a facility needs more time? • The Rules include a variance process • Facilities may apply for a variance from any requirement other than enclosure • Rules set forth criteria for issuing variances, including consideration of public comments • Variances may be granted only if they will not adversely impact the surrounding environment and properties and will not create a public nuisance

19. Variance Requests • KCBX initially submitted a request for a variance from 5 requirements: • Pile height • Covering of conveyors • Winter operation of dust suppressant system • Suspending disturbance of piles during maintenance • Runoff management • Eight other bulk material facilities requested variances from some of the rules, including the dust monitoring requirement

20. Variance Decision • After an extended comment period, CDPH received 12 comments on KCBX’s variance request, including detailed comments from the Natural Resources Defense Council (NRDC) and the Southeast Environmental Task Force (SETF) • With technical assistance from environmental consultant CDM Smith, CDPH issued the variance determination on December 9, 2014 • We denied the request to increase pile height and leave certain conveyors uncovered. The other requests were granted with conditions.

21. Enclosure Time Line • KCBX also requested a 14-month extension of the deadline for enclosing all petcoke and coal, from June 9, 2016 to August 24, 2017. • On February 16, 2015, CDPH informed KCBX that the variance request was insufficient and would not be granted at this time.

22. Next Steps • KCBX asked for reconsideration of the variance denial regarding conveyors. This request is under review. • Decisions will be made on the non-petcoke variance requests after additional information is received from the applicants • CDPH will continue to inspect the facilities, respond to complaints, and review dust plans