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Appendix 3: Projection Factors for Point and Area Sources (Adopted APPENDIX 3 PROJECTION FACTORS FOR POINT AND AREA SOURCES Eastern Research Group, Inc. PROJECTION FACTORS FOR POINT AND AREA SOURCES Final Prepared for: Texas Commission on Environmental Quality Air Quality Division MC-164, P.O. Box 13087 Austin, TX 78711-3087 August 16, 2010 ERG No. 0227.03.027.006 TCEQ Contract No. 582-07-84003 Work Order No. 582-07-84003-FY10-27 PROJECTION FACTORS FOR POINT AND AREA SOURCES Final Prepared for: Texas Commission on Environmental Quality Air Quality Division MC-164, P.O. Box 13087 Austin, TX 78711-3087 Attn: Mr. Greg Lauderdale Prepared by: Eastern Research Group, Inc. 10860 Gold Center Drive, Suite 275 Rancho Cordova, CA 95670 August 16, 2010 TABLE OF CONTENTS Section Page ES.0 EXECUTIVE SUMMARY .....................................................................................................1 1.0 INTRODUCTION ...................................................................................................................1 2.0 DATA COLLECTION............................................................................................................2 2.1 Economy.com Economic Data and Projections............................................................ 3 2.2 Texas Industrial Production Index................................................................................ 3 2.3 Annual Energy Outlook ................................................................................................ 4 2.4 EGAS Model................................................................................................................. 4 2.5 U.S. EPA Projections-Related Research....................................................................... 4 2.6 Texas State Comptroller Data....................................................................................... 5 2.7 Texas Workforce Commission ..................................................................................... 5 2.8 Federal Reserve Bank of Dallas.................................................................................... 5 2.9 Industry Associations.................................................................................................... 5 3.0 DEVELOPMENT OF POINT SOURCE GROWTH FACTORS ..........................................6 3.1 More Significant Point Source Sectors......................................................................... 7 3.2 Less Significant Point Source Sectors ........................................................................ 12 3.3 All Point Source Sectors ............................................................................................. 12 4.0 DEVELOPMENT OF AREA SOURCE GROWTH FACTORS .........................................13 4.1 Adjustment from SIC Codes to NAICS Codes........................................................... 13 4.2 Expanded Use of Economy.com Output Data ............................................................ 13 4.3 Expanded Use of Annual Energy Outlook Data......................................................... 31 4.4 Use of Texas-Specific Population Projections............................................................ 32 4.5 Use of Flat/No Growth Factors................................................................................... 33 5.0 DATA ANALYSIS...............................................................................................................34 6.0 FORMATTED GROWTH FACTORS .................................................................................42 7.0 CAVEATS ASSOCIATED WITH USE OF GROWTH FACTORS ...................................42 8.0 REFERENCES ......................................................................................................................43 Tables Page Table 3-1. Most Significant VOC Point Source Sectors in TCEQ Point Source Inventory .......... 7 Table 3-2. Most Significant NOx Point Source Sectors in TCEQ Point Source Inventory............ 7 Table 3-3. Comparison of Economy.com Output-Based and WDA Employment-Based Growth Factors between 2006 and 2016.................................................................................. 10 Table 4-1. Area Source Category Projection Data Assignments ................................................. 14 Figures Page Figure 4-1. Range of Population Growth Factors for Texas ...................................................... 33 Figure 4-2. Population Growth Factors for 10 Most Populous Counties in Texas..................... 34 Figure 5-1. Top Five State-Level Point Source VOC Categories .............................................. 36 Figure 5-2. Top Five State-Level Area Source VOC Categories ............................................... 36 Figure 5-3. State-Level Oil & Gas Point Source VOC Categories............................................. 37 TCEQ, Projection Factors i Final, August 16, 2010 TABLE OF CONTENTS (Continued) Figures Page Figure 5-4. State-Level Oil & Gas Area Source VOC Categories ............................................. 37 Figure 5-5. Top Five State-Level Point Source CO Categories ................................................. 38 Figure 5-6. Top Five State-Level Area Source CO Categories.................................................. 38 Figure 5-7. State-Level Oil & Gas Point Source CO Categories ............................................... 39 Figure 5-8. State-Level Oil & Gas Area Source CO Categories ................................................ 39 Figure 5-9. Top Five State-Level Point Source NOx Categories................................................ 40 Figure 5-10. Top Five State-Level Area Source NOx Categories................................................ 40 Figure 5-11. State-Level Oil & Gas Point Source NOx Categories ............................................. 41 Figure 5-12. State-Level Oil & Gas Area Source NOx Categories.............................................. 41 TCEQ, Projection Factors ii Final, August 16, 2010 ACRONYMS AEO Annual Energy Outlook BEA Bureau of Economic Analysis BLS Bureau of Labor Statistics CO carbon monoxide EAC Early Action Compact EGAS Economic Growth Analysis System EIA Energy Information Administration EIIP Emission Inventory Improvement Program ERCOT Electric Reliability Council of Texas ERG Eastern Research Group, Inc. INGAA Interstate Natural Gas Association of America NAAQS National Ambient Air Quality Standard NAICS North American Industry Classification System NGSA Natural Gas Supply Association NOx nitrogen oxides PUCT Public Utility Commission of Texas RA Rocky Mountain Power Area REMI Regional Economic Growth, Inc. SCC Source Classification Code SERC Southeastern Electric Reliability Council SIC Standard Industrial Classification SIP State Implementation Plan SPP Southwest Power Pool TCC Texas Chemical Council TCEQ Texas Commission for Environmental Quality TIPI Texas Industrial Production Index U.S. EPA U.S. Environmental Protection Agency VOC volatile organic compound WDA Workforce Development Area TCEQ, Projection Factors iii Final, August 16, 2010 ES.0 EXECUTIVE SUMMARY Eastern Research Group, Inc. (ERG) completed the development of a comprehensive suite of growth factors for point and area sources. The growth factors were based upon a base year of 2005 and were developed for each year between 2006 and 2035. Various demographic and economic data were used to develop the growth factors, including: energy projections from the Energy Information Administration’s (EIA) Annual Energy Outlook, economy forecasts from Economy.com, Texas-specific population projections, etc. In addition, analysis was conducted to demonstrate growth factor variances. The developed growth factors were submitted to TCEQ along with the final report. The point source growth factors and associated data were provided in Microsoft Access. The area source growth factors and associated data were provided in a TexAER loadable format, as well as in a Microsoft Access format, where all fields are complete and all mandatory fields have been quality assured. All resulting TexAER loadable files will be entered into TexAER. Any errors or discrepancies identified in the TexAER loadable format or loading process will be corrected by ERG, or otherwise addressed in consultation with the TCEQ. 1.0 INTRODUCTION Emission inventories are a core component of air quality analyses. Inventories are used to estimate the quantity of emissions generated by a wide range of source types (i.e., point sources, area sources, on-road motor vehicles, and nonroad mobile sources) and pollutants (e.g., criteria air pollutants, hazardous air pollutants, etc.). Inventories are used as inputs to air quality models for simulating air quality concentrations based on “business as usual” and/or control scenarios for determining future-year compliance with federal National Ambient Air Quality Standards (NAAQS) within State Implementation Plans (SIPs). The Texas Commission on Environmental Quality (TCEQ) uses base year inventories and future year projections to develop SIPs. In general, future year inventory projections are estimated by applying growth and control factors to base year emissions. As part of a project completed in 2005, Eastern Research Group, Inc. (ERG) developed a suite of area source growth factors through 2020 (and backcasting factors for years dating back to 1990) based upon a 2002 base year. For ongoing SIP development, TCEQ now needs to estimate future year emissions out to 2035 for both point and area sources. As a result, the purpose of this project is the TCEQ, Projection
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