This morning, the Environmental Protection Agency (EPA) released its proposed replacement for the Clean Power Plan (CPP) titled the “Affordable Clean Energy Rule,” which would regulate greenhouse gas emissions at existing coal-fired power plants. The proposed rule gives discretion to states for determining the greenhouse gas performance standards achievable for existing coal-fired power plants within their state. Specifically, the proposed rule would require states to evaluate a menu of heat rate improvement options and, taking into account the unit’s remaining useful life and other factors, determine the lb/MWh CO2 emission rate achievable at each affected unit. While the rule proposes to allow for emissions averaging among affected units at an individual source, it does not provide for broader averaging or emissions trading. To facilitate the heat rate improvement projects, EPA also has proposed an option for states to adopt a new emissions test under the New Source Review program for EGUs that is based on both hourly and annual emissions.
The unprecedented legal battles over the Clean Power Plan have been on ice for quite some time. However, recent events suggest the rule may start making headline news once again very soon.
On April 17, 2010 EPA issued a guidance document on the implementation of significant impact levels (“SIL”) for ozone and fine particles. Under EPA’s air pollution permitting regime known as “New Source Review,” SIL values are one way to demonstrate that a new facility or modification of an existing facility will not cause a violation of the National Ambient Air Quality Standards (“NAAQS”) or Prevention of Significant Deterioration (“PSD”) increments for a regulated pollutant. In short, if a source’s “projected impact on air quality” is below the “SIL,” the source is deemed to have no significant impact on air quality. If a source’s impacts are above the SIL, far more extensive modeling analyses are needed to demonstrate compliance, so the SIL helps streamline the permitting process for projects that can meet it.
On March 20th, the DC Circuit upheld EPA’s June 2012 “CSAPR = BART Rule,” establishing that compliance with EPA’s Cross State Air Pollution Rule (CSAPR) will satisfy the Best Available Retrofit Technology (BART) requirements for SO2 and/or NOx under the Regional Haze Rules for electric generating units (EGUs) subject to CSAPR. Under the Regional Haze Program, EPA has issued regulations that allow the Agency to approve alternatives to BART if EPA finds that the controls are “better than BART.”
NSR—the program imposing onerous permitting requirements on the construction of new sources and “major modification” projects at existing sources—requires industrial sources of air emissions to determine whether the projects they propose will increase those emissions. EPA adopted regulations in 2002 to provide a new structure for those critical emission calculations, which specifies that sources must calculate the “sum of the differences” between a baseline and a future projection for each existing emission unit. That language is particularly important for individual projects that may cause emissions to go down at one unit but up at another.
On March 1, 2018, EPA released a final rule defining nonattainment area classifications under the 2015 ozone standard, along with attainment deadlines for each classification. The rule finalizes the classifications and deadlines that were originally proposed by the Obama administration in a proposed rule issued on November 17, 2016. (81 Fed. Reg. 81,276). According to Section 181(a)(1) of the Clean Air Act, nonattainment areas must be classified at the time of designation, so this rulemaking clears the way for EPA to issue final designations for the 2015 standard. The air quality thresholds for each classification and the associated attainment deadlines are listed in the chart below. The final rule has not yet been published in the Federal Register.
|CLASSIFICATION||THRESHOLD||MAXIMUM ATTAINMENT DATE|
|Marginal||71 ppb up to 81 ppb||3 years|
|Moderate||81 ppb up to 93 ppb||6 years|
|Serious||93 ppb up to 105 ppb||9 years|
|Severe||105 ppb up to 163 ppb||15 years (or 17 years)|
|Extreme||163 ppb||20 years|
* from effective date of designation
On January 25, 2018, EPA’s Assistant Administrator, William Wehrum, issued a memorandum addressing when a “major source” subject to a section 112 maximum achievable control technology (“MACT”) standard of the Clean Air Act (“CAA”) can be reclassified as an “area source,” and thus avoid any more stringent requirements that only apply to “major sources.” The memorandum departs from and supersedes EPA’s longstanding “Once in Always in” (“OIAI”) policy articulated in the May 1995 Seitz Memorandum. Under the OIAI policy, a major source of hazardous air pollutants (“HAPs”) was permanently subject to the MACT standard at the “first compliance date” of the standard even if the source was able to later limit its potential to emit (“PTE”) HAPs below the major source thresholds. EPA’s new policy explains that a major source will become an area source once it takes enforceable limits on its PTE to ensure emissions cannot exceed the applicable major source thresholds for HAPS.
This afternoon, EPA announced the details on the three anticipated “listening sessions” in connection with the Agency’s proposed repeal of the Clean Power Plan (CPP). At the same time, EPA noted that it would reopen the comment period on the proposal until April 26th. The comments are currently due to EPA by next Tuesday, January 16th. EPA’s Clean Power Plan webpage has been updated to reflect the effective extension of the comment period until late April. The listening sessions will be held in Kansas City, MO, San Francisco, CA and Gillette WY as follows:
Kansas City Listening Session
Date: Wednesday, February 21, 2018
Time: 10 a.m. until 8 p.m., Central Standard Time (CST)
Location: U.S. Department of Agriculture Beacon Complex, 6501 Beacon Drive, Kansas City, Missouri 64133
San Francisco Listening Session
Date: Wednesday, February 28, 2018
Time: 8:30 a.m. until 7:30 p.m., Pacific Standard Time (PST)
Location: San Francisco Main Library, Koret Auditorium, 30 Grove Street entrance, San Francisco, California 94102
Gillette Listening Session
Date: Tuesday, March 27, 2018
Time: 9 a.m. until 8 p.m., Mountain Daylight Time (MDT)
Location: Gillette College Technical Education Center, 3251 South 4-J Road, Gillette, Wyoming 82718
On January 9, 2018, the EPA published the third round of final area designations under the 2010 SO2 NAAQS. In this round, the EPA identified six (6) nonattainment areas located in Florida, Indiana, Louisiana, Puerto Rico and Guam. EPA designated 23 areas as unclassifiable and all other areas as attainment/unclassifiable. The primary focus in this round was on those areas electing to rely on ambient air quality modeling to assess attainment with the standard.
On January 8, the Supreme Court denied Murray Energy’s petition for appeal of a Fourth Circuit decision that had rejected its efforts to obtain judicial enforcement of Section 321 of the Clean Air Act (“CAA”). Section 321(a) requires EPA to evaluate the potential for plant closures and job losses resulting from regulation and/or enforcement under the Act. The decision marks the end of a legal challenge brought by Murray Energy and 15 states in October 2016, in which the Northern District of West Virginia strongly rebuked EPA’s failure to comply with the statute (as previously reported here). In a 27-page opinion, the district court took EPA to task, finding that the Agency’s longstanding failure to comply with § 321 evidenced a “continued hostility” to the provision. The district court required the Agency to establish a system by the end of 2017 for conducting the evaluations.