Background
Under the Colorado Department of Public Health and Environment (CDPHE) Air Quality Control Commission (AQCC) Regulation No. 3, facilities that qualify as major sources are required to obtain Title V operating permits, which represent a significantly more burdensome permitting pathway than the construction permits that apply to minor and synthetic minor sources. Many facilities actively manage their emissions to remain below major source thresholds, making an accurate facility-wide potential to emit (PTE) analysis critical.
A common applicability pitfall is assuming that “insignificant activities” can be ignored when determining whether a source is major. In practice, “insignificant” does not mean irrelevant. While Regulation No. 3 allows facilities to streamline documentation of insignificant activities in certain circumstances, this is an administrative convenience, not an exemption from the facility-wide PTE analysis. If emissions from small or routine activities contribute to crossing a major source threshold, those emissions can still drive Title V applicability and must be included in facility-wide PTE determinations.
This issue has become especially important in Colorado because ozone nonattainment classifications have lowered the major source threshold for nitrogen oxides (NOX) and volatile organic compounds (VOC) in parts of the state. In the Denver Metro/North Front Range (DMNFR) area, EPA’s reclassification to Severe for the 2008 ozone standard reduced the major source threshold for NOX and VOC from 50 tons per year (tpy) to 25 tpy, effective November 7, 2022. At that lower threshold, a collection of small sources that once seemed too small to matter can now be the deciding factor in whether a facility crosses into major source status and triggers Title V permitting.
Key Definitions under Regulation No. 3
Major Source:
Colorado Regulation No. 3 defines a major source as any stationary source, or group of stationary sources under common control, that emits (or has the potential to emit, considering enforceable controls) regulated pollutants above specified thresholds. For hazardous air pollutants (HAPs), the thresholds are 10 tpy for any single HAP or 25 tpy for any combination of HAPs. For criteria pollutants, the applicable threshold is generally 100 tpy but is lower based on the attainment status of the area. In the DMNFR, which is classified as a Severe ozone nonattainment area, the major source threshold for NOX and VOC drops to 25 tpy.
Potential To Emit (PTE):
A central concept in this definition is potential to emit. PTE represents the maximum emissions a source could achieve based on its physical and operational design, accounting only for federally enforceable limitations; it is not a projection of typical or expected operations. As a result, assumptions such as infrequent operation, comfort-only use, or the expectation that multiple units will not operate simultaneously cannot be used to limit PTE unless they are explicitly codified as enforceable permit conditions.
Insignificant Activities:
Another important concept is insignificant activities. Regulation No. 3, Part C, Section II.E. identifies certain activities as “insignificant” for Title V permitting purposes, generally because of their small size and low emission rates. Sources that meet this designation are not always required to be included in an operating permit application or tracked regularly. However, this designation does not inherently exclude these activities from PTE determinations. To the extent that emissions from insignificant activities are quantifiable and not otherwise exempted, they must be included in facility-wide emissions calculations when evaluating major source applicability.
Common Source Types That Deserve Careful Review
Emergency engines are one of the most common examples of a source category that deserves careful consideration when evaluating PTE. EPA has long recognized that true emergency generators are inherently constrained because they are designed solely to provide backup power when utility service is interrupted. For that reason, EPA does not recommend using 8,760 hours per year for a genuine emergency generator whose sole function is backup power. Instead, EPA’s long-standing guidance recommends a default assumption of 500 hours per year to reflect a reasonable worst-case estimate of emergency use plus maintenance and testing, unless a different case-specific value is justified.
Operators should be careful not to confuse Colorado’s construction permit exemptions with federally enforceable PTE limits. In Colorado, an emergency generator operating no more than 250 hours per year may qualify for a construction permit exemption, but that type of state permitting exemption does not by itself create a federally enforceable limit for Title V applicability. Unless a qualifying limit is established through an enforceable permit condition, emergency engines should generally be evaluated using the 500-hour default assumption for PTE purposes. PTE of non-emergency engines should generally be evaluated at maximum rates and continuous operation unless an enforceable operational limit has been established.
Small combustion units are another frequent source of confusion. Regulation No. 3 includes certain small fuel-burning equipment (design rate ≤5 MMBtu/hr) in the insignificant activities list, but that does not mean these units can be ignored in a facility-wide PTE evaluation. Unless enforceable limits are applied to these combustion units, PTE should be evaluated at maximum rates and continuous operation. Natural gas-fired comfort heating units, boilers, hot water heaters, ovens, dryers, and similar equipment may each emit relatively small amounts of criteria pollutants. When evaluated together at maximum design rate and without enforceable operational limits, they may materially affect major source status, particularly in areas with reduced NOX and VOC thresholds.
Why This Matters Now in Colorado
These principles are not new. What has changed is how much is at stake in getting the analysis right. In the DMNFR area, the Severe ozone nonattainment classification under the 2008 ozone standard means the major source threshold for NOX and VOC is now 25 tpy. That lower threshold has increased the importance of small and previously overlooked activities in facility-wide applicability reviews.
This is particularly relevant for facilities with multiple small combustion sources, backup engines, building heat, process heaters, or other low-emitting equipment that may not historically have received much attention. Even if a source’s actual annual emissions remain small, its calculated PTE can be significantly higher. If the DMNFR Nonattainment area is reclassified as an “Extreme” nonattainment area in the future, the applicable NOX and VOC thresholds would drop further to 10 tpy, bringing even more facilities into Title V territory.
Conclusion
For facilities located in Colorado, small sources that meet the definition of an “insignificant activity” cannot be ignored when considering Title V applicability. The better approach is to maintain a current, facility-wide PTE inventory that captures all relevant emission units, including emergency engines, non-emergency engines, small natural gas-fired combustion units, and other seemingly minor sources that can collectively influence major source status. Facilities whose PTE approaches or exceeds major source thresholds can apply for construction permits to establish enforceable operational limits, bringing the facility-wide PTE below major source thresholds and becoming a “synthetic minor” source. If enforceable limits are not practicable or possible, facilities should submit an application for a Title V operating permit.
Trinity is prepared to help your company determine or review the facility-wide PTE and insignificant activity evaluations. If you would like to discuss, please email Mary Mass in Trinity’s Denver office or call 720.638.7647.
