1. VEEP and Environmental Management Systems

2. What does an EMS mean? (EMS elements) What does an EMS mean? (EMS elements) What’s different in facilities that have an EMS? What’s different in facilities that have an EMS? How does it relate to DEQ staff? How does it relate to DEQ staff? Why do facilities participate in VEEP? Why do facilities participate in VEEP? What are potential regulatory benefits (incentives)? What are potential regulatory benefits (incentives)?

3. What does an EMS mean? An EMS is an organized approach to managing environmental impacts at a facility An EMS is an organized approach to managing environmental impacts at a facility Provides a consistent review of all operations to determine the environmental impacts and focus resources on the most important issues Provides a consistent review of all operations to determine the environmental impacts and focus resources on the most important issues Covers all requirements; regulatory, Corporate or company requirements Covers all requirements; regulatory, Corporate or company requirements Includes activities and impacts that are not covered by regulations Includes activities and impacts that are not covered by regulations

4. Elements of an EMS EPA’s EMS elements: EPA’s EMS elements: Environmental Policy Environmental Policy Regulatory Requirements Identification/Tracking Regulatory Requirements Identification/Tracking Roles/Responsibilities Roles/Responsibilities Training and Communication Training and Communication Environmental Control and Monitoring Environmental Control and Monitoring Compliance Change Management Compliance Change Management Corrective and Preventative Actions Corrective and Preventative Actions Records and Recordkeeping Records and Recordkeeping Audits and Inspections Audits and Inspections Management Review Management Review Can also be “home-grown” Can also be “home-grown”

5. What’s different in facilities that have an EMS? Usually the facilities are well run and have other management systems (safety, quality, financial, etc.) Usually the facilities are well run and have other management systems (safety, quality, financial, etc.) Generally have progressive environmental programs and good compliance history. Generally have progressive environmental programs and good compliance history. Often involved in “beyond compliance” activities Often involved in “beyond compliance” activities Participate in voluntary environmental, health and safety programs (VEEP, Performance Track, VPP Star) Participate in voluntary environmental, health and safety programs (VEEP, Performance Track, VPP Star) Employee engagement and management support Employee engagement and management support Reducing environmental impacts becomes everyone’s job, not just the EHS staff Reducing environmental impacts becomes everyone’s job, not just the EHS staff

6. How does VEEP relate to DEQ staff? Facilities within VEEP are usually the “good guys” Facilities within VEEP are usually the “good guys” May expect to be treated with more trust and respect – because of their performance May expect to be treated with more trust and respect – because of their performance Often willing to consider alternative approaches that make sense for the company, the environment and the DEQ. Often willing to consider alternative approaches that make sense for the company, the environment and the DEQ. Why “waste” DEQ time inspecting facilities that are in compliance? Why “waste” DEQ time inspecting facilities that are in compliance?

7. Why does a facility participate in VEEP? Recognition Recognition Community and Employees Community and Employees Regulators Regulators Corporate Management Corporate Management Environmental, Safety and Health Staff Environmental, Safety and Health Staff EHS viewed as an asset by plant management EHS viewed as an asset by plant management Plant managers usually hear only problems, we bring good news and positive recognition Plant managers usually hear only problems, we bring good news and positive recognition

9. Who is in VEEP?

10. VEEP Participation (Cont.) Improved communication with regulators Improved communication with regulators Opportunity to “show off” Opportunity to “show off” It’s enjoyable working with other facilities on their EMS goals It’s enjoyable working with other facilities on their EMS goals Potential regulatory relief Potential regulatory relief 180 RCRA Waste Storage 180 RCRA Waste Storage MACT reporting reductions MACT reporting reductions More pending with EPA More pending with EPA Improved image with Customers Improved image with Customers Cost Savings Cost Savings Low cost of participation Low cost of participation

12. Role of Incentives in Voluntary Programs From the EPA Performance Track web site: Incentives are being designed and implemented to: Incentives are being designed and implemented to: Recognize and reward environmental accomplishments Recognize and reward environmental accomplishments Encourage facilities to perform beyond basic compliance Encourage facilities to perform beyond basic compliance Allow members to operate more efficiently, and, Allow members to operate more efficiently, and, Demonstrate that innovation is integral to EPA’s evolving framework Demonstrate that innovation is integral to EPA’s evolving framework

13. Desirable Features of Good Incentives Apply to a broad range of industry or really attractive to one segment Apply to a broad range of industry or really attractive to one segment Easy to understand, implement and verify Easy to understand, implement and verify Will save time and money for both industry and government Will save time and money for both industry and government Result in measurable environmental improvements (preferably at lower cost) Result in measurable environmental improvements (preferably at lower cost) Attractive enough to encourage membership by all sizes of companies including small to medium size businesses Attractive enough to encourage membership by all sizes of companies including small to medium size businesses Improve the environment faster than otherwise expected (can also reduce non-point source pollution or releases of non-regulated pollutants) Improve the environment faster than otherwise expected (can also reduce non-point source pollution or releases of non-regulated pollutants) Significantly increase the number of members so the environment will show measurable improvement Significantly increase the number of members so the environment will show measurable improvement

14. Possible Non-Regulatory Incentives Time Time Priority Permitting (also known as Expedited Permitting or Top of Pile) Priority Permitting (also known as Expedited Permitting or Top of Pile) Reduced inspection priority Reduced inspection priority Faster permitting for pollution control projects Faster permitting for pollution control projects Insurance benefits Insurance benefits Financial Financial Preferred buying list for the government Preferred buying list for the government Tax benefits Tax benefits Revolving loans Revolving loans

15. Possible Non-Regulatory Incentives Flexibility Flexibility Flexible permits – changes made quickly, encourages innovative technologies, improves speed to market Flexible permits – changes made quickly, encourages innovative technologies, improves speed to market Access Access Someone to talk to for new permits and concerns Someone to talk to for new permits and concerns Publicity Publicity Recognition for “beyond compliance” Recognition for “beyond compliance” Benefit of doubt if compliance issue occurs Benefit of doubt if compliance issue occurs Socially responsible investment organizations give credit for membership Socially responsible investment organizations give credit for membership

16. Practical Experience Implementing Incentives Facility unique priorities Facility unique priorities Every facility seems to have their own issues and priorities making the selection of a broad based incentive difficult Every facility seems to have their own issues and priorities making the selection of a broad based incentive difficult Regulatory change is hardest Regulatory change is hardest Non-regulatory changes are the most likely to succeed Non-regulatory changes are the most likely to succeed Culture Change has been slow Culture Change has been slow Many people and organizations accept the inefficiencies of the existing regulatory structure and are uncomfortable with change Many people and organizations accept the inefficiencies of the existing regulatory structure and are uncomfortable with change Change will come slowly to those willing to invest time and effort and some changes have been happening lately Change will come slowly to those willing to invest time and effort and some changes have been happening lately

17. EPA Incentives Initiatives EPA Incentives Initiatives EPA Administrator is championing Performance Track EPA Administrator is championing Performance Track Air, water and waste initiatives being studied Air, water and waste initiatives being studied Other organizations involved Other organizations involved ECOS ECOS PTPA PTPA EPA regulatory and Performance Track Program changes EPA regulatory and Performance Track Program changes Visit EPA’s web site for more details Visit EPA’s web site for more details

18. Current EPA Incentive Initiatives Air Air Flexible permits rulemaking – PT permit applications ahead of others Flexible permits rulemaking – PT permit applications ahead of others Reduced frequency of MACT reporting for PT sites (April 2004 rule) Reduced frequency of MACT reporting for PT sites (April 2004 rule) Water Water Expired NPDES permits, PT permits first Expired NPDES permits, PT permits first Trade ambient water quality data for reduced permit monitoring data Trade ambient water quality data for reduced permit monitoring data Waste Waste Extension of onsite storage times for hazardous waste (April 2004 rule) Extension of onsite storage times for hazardous waste (April 2004 rule)

19. Specific EPA Incentives (Air) Facilities that are members of Performance Track that are governed by Maximum Achievable Control Technology (MACT) provisions of the Clean Air Act (CAA) benefit from reduced reporting frequency (annual instead of semi- annual). In certain cases, they may submit annual certification statement in lieu of annual reports. Facilities that are members of Performance Track that are governed by Maximum Achievable Control Technology (MACT) provisions of the Clean Air Act (CAA) benefit from reduced reporting frequency (annual instead of semi- annual). In certain cases, they may submit annual certification statement in lieu of annual reports.

20. Specific EPA Incentives (RCRA) The Resource Conservation and Recovery Act (RCRA) regulations were revised to allow hazardous waste generators who are members of Performance Track up to 180 days (and 270 days if waste is transported 200 miles or more), to accumulate their hazardous waste without a RCRA permit or interim status. The Resource Conservation and Recovery Act (RCRA) regulations were revised to allow hazardous waste generators who are members of Performance Track up to 180 days (and 270 days if waste is transported 200 miles or more), to accumulate their hazardous waste without a RCRA permit or interim status.

21. Current Virginia Incentives for Env. Excellence Participants Discounts to the annual permit fees will be applied for solid waste, hazardous waste and water fees issued during the summer of 2005 for facilities that were in the program prior to January 1, 2005 and remain in good standing. Discounts to the annual permit fees will be applied for solid waste, hazardous waste and water fees issued during the summer of 2005 for facilities that were in the program prior to January 1, 2005 and remain in good standing. The following slides explain the reductions for Solid Waste Permit, Hazardous Waste & Water Permits. The following slides explain the reductions for Solid Waste Permit, Hazardous Waste & Water Permits.

22. Solid Waste Permit Fees Reduction Potentially up to a 10% discount for E2 facilities (maximum of three years) Potentially up to a 10% discount for E2 facilities (maximum of three years) Potentially up to a 20% discount for E3 facilities Potentially up to a 20% discount for E3 facilities (see 9 VAC 20-90-117) (see 9 VAC 20-90-117)

23. Hazardous Waste Permit Fees Reduction Potentially up to a 5% discount for E2 (maximum of three years) Potentially up to a 5% discount for E2 (maximum of three years) Potentially up to a 10% discount for E3 Potentially up to a 10% discount for E3 (see 9 VAC 20-60-1286) (see 9 VAC 20-60-1286)

24. Water Permit Fees Reduction Potentially up to a 2% discount for E2 (maximum of three years) Potentially up to a 2% discount for E2 (maximum of three years) Potentially up to a 5% discount for E3 Potentially up to a 5% discount for E3 (see 9 VAC 25-20-145) (see 9 VAC 25-20-145)

25. Alternate Compliance Methods Rule issued (March 24, 2005) giving Virginia Environmental Excellence members (E3 and E4 levels) the option of “alternate compliance methods” Rule issued (March 24, 2005) giving Virginia Environmental Excellence members (E3 and E4 levels) the option of “alternate compliance methods”

26. Chesapeake Bay Nutrient Strategy Alternate Compliance Method for Virginia E3 & E4 members Alternate Compliance Method for Virginia E3 & E4 members Suspension of applicable Technology-based effluent concentration limitations Suspension of applicable Technology-based effluent concentration limitations Permittee must fully-implement their EMS Permittee must fully-implement their EMS EMS specifically addresses nutrients EMS specifically addresses nutrients Facility maintains nutrient removal technologies at the treatment efficiency levels for which they were designed. Facility maintains nutrient removal technologies at the treatment efficiency levels for which they were designed.

27. How to Request Regulatory Flexibility Each site should request specific regulatory flexibility items in writing to Sharon Baxter (Pollution Prevention Group at DEQ Central Office). They should copy their DEQ Regional Director on this request. Each site should request specific regulatory flexibility items in writing to Sharon Baxter (Pollution Prevention Group at DEQ Central Office). They should copy their DEQ Regional Director on this request.

28. Promoting P-Track & VEEP These “road shows” including the P2 staff presentation in the spring These “road shows” including the P2 staff presentation in the spring Providing brochures and posters to each Regional Office Providing brochures and posters to each Regional Office Announcements of recognition ceremonies on the P2 web site Announcements of recognition ceremonies on the P2 web site Identifying P-Track & VEEP membership in the CEDS database on the “facility” screen Identifying P-Track & VEEP membership in the CEDS database on the “facility” screen

30. Environmental Innovation Project International Paper Franklin, VA (example of regulatory flexibility awarded to EPA PT and VA DEQ E4 site)

31. Purpose of Innovation Project Partnership Approach Partnership Approach Innovative & Cost Effective Innovative & Cost Effective Exceed Regulations Exceed Regulations Maximum Benefit to Environment, Community & Mill Maximum Benefit to Environment, Community & Mill

32. Traditional Environmental EPA MACT Rules EPA Cluster Rule MACT I Phase II requires collection and incineration of methanol air emissions from sources in the paper mill. EPA Cluster Rule MACT I Phase II requires collection and incineration of methanol air emissions from sources in the paper mill. Cost estimate for Franklin: $32 MM by year 2006. Cost estimate for Franklin: $32 MM by year 2006.

33. Innovation Concept Identify more cost effective means to collect equivalent amount of methanol as EPA regulations require Identify more cost effective means to collect equivalent amount of methanol as EPA regulations require Invest half of the avoided capital cost in voluntary environmental improvement projects at the plant Invest half of the avoided capital cost in voluntary environmental improvement projects at the plant Use a Stakeholder Group to identify which voluntary environmental projects were chosen Use a Stakeholder Group to identify which voluntary environmental projects were chosen

34. Innovation Concept Collect equivalent amount of regulated air emissions (methanol) Collect equivalent amount of regulated air emissions (methanol) Identified alternate sources of same amount of methanol air emissions for collection to what rule required Identified alternate sources of same amount of methanol air emissions for collection to what rule required Cost estimate : $22.5 MM (Provides avoidance of $9.4 MM in capital costs) Cost estimate : $22.5 MM (Provides avoidance of $9.4 MM in capital costs)

35. Innovation Concept Invest half of capital avoidance dollars for voluntary superior environmental projects at Franklin mill Invest half of capital avoidance dollars for voluntary superior environmental projects at Franklin mill Stakeholder team selected projects Stakeholder team selected projects Proposed spending: $7 MM (75% avoided cost) Proposed spending: $7 MM (75% avoided cost)

36. Superior Environmental Performance Projects What IP is Offering to Voluntarily Implement

37. Voluntary Environmental Improvement Projects Voluntary projects focused on all media (air, water and waste reductions) Voluntary projects focused on all media (air, water and waste reductions) Projects included air system improvement in boiler, process changes to reduce fugitive dusting, recycle of waste water, recycle of solid waste, effluent treatment system improvements) Projects included air system improvement in boiler, process changes to reduce fugitive dusting, recycle of waste water, recycle of solid waste, effluent treatment system improvements) Significant environmental benefits from projects: Significant environmental benefits from projects: Air emissions reduction (560 tpy SO2, 75 tpy NOx) Air emissions reduction (560 tpy SO2, 75 tpy NOx) Fugitive dust reduction (8 tpy) Fugitive dust reduction (8 tpy) Groundwater withdrawal reduction (0.5 MMGPD) Groundwater withdrawal reduction (0.5 MMGPD) Solid waste reduction (8600 lb/day) Solid waste reduction (8600 lb/day) Effluent quality improvement (2000 lb/day COD) Effluent quality improvement (2000 lb/day COD)

38. Environmental Innovation Environmental Innovation Project is beneficial to: Environmental Innovation Project is beneficial to: the environment due to the same amount of regulated methanol being collected, as well as $7 MM of voluntary environmental improvement projects being implemented (air, water and waste reductions) the environment due to the same amount of regulated methanol being collected, as well as $7 MM of voluntary environmental improvement projects being implemented (air, water and waste reductions) The community, Va DEQ, EPA and International Paper due to partnerships formed in finding an Innovative way to meet environmental regulations The community, Va DEQ, EPA and International Paper due to partnerships formed in finding an Innovative way to meet environmental regulations “Win-Win for environment, the community, and the Franklin mill” “Win-Win for environment, the community, and the Franklin mill”