Green Light for Federal Climate Regulations Beginning in January 2011
The final impediment to EPA's regulation of Greenhouse Gases ("GHGs") was put on hold Friday, December 17, clearing the way for federal climate regulations to take effect on Jan. 2, 2011.
On December 17, 2010, West Virginia Sen. Jay Rockefeller (D) announced that he is postponing a vote on his bill to enact a two-year moratorium on U.S. EPA's ability to regulate greenhouse gases due to lack of bipartisan support. Sen. Rockefeller plans to pursue the bill again in 2011, but that will be after the first phase of the regulations have taken effect.
On January 2, 2011, EPA's GHG emissions standards for light-duty vehicles take effect. On that same date, pursuant to EPA's Tailoring Rule, the first phase of EPA's GHG regulations for stationary sources will take effect. As of January 2, existing facilities that obtain a Clean Air Act permit for other pollutants will also be required to determine the Best Available Control Technology (BACT) for GHG emissions if they increase GHG emissions by at least 75,000 tons per year ("tpy"). No sources, however, would be subject to Clean Air Act permitting requirements in this first phase solely due to GHG emissions.
In the second phase of GHG requirements, starting in July 2011, Clean Air Act permitting requirements will be expanded to cover all new facilities with GHG emissions of at least 100,000 tpy (even if they do not exceed the permitting thresholds for any other pollutant) and modifications at existing facilities that would increase GHG emissions by at least 75,000 tpy (even if they do not significantly increase emissions of any other pollutant).
EPA estimates that about 550 sources will need to obtain Title V permits for the first time due to their GHG emissions. The majority of these newly permitted sources will likely be solid waste landfills and industrial manufacturers. EPA estimates that there will be approximately 900 additional PSD permitting actions each year triggered by increases in GHG emissions from new and modified emission sources.
EPA has not revealed what the next proposed phase of GHG requirements will entail. EPA has committed to undertaking another rulemaking in 2011 which would conclude no later than July 1, 2012. The agency has said that in this third phase of requirements, no sources that emit less than 50,000 tons per year will be required to seek permits and that smaller sources would not be required to take any action until at least April 30, 2016.
If you have questions regarding these rules or their applicability to your operations please contact Jeff Talbert or Steven Hudson with Preti Flaherty's Climate Strategy Group.