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EPA Proposes to Focus First Greenhouse Gas Permitting Requirements on Large Industrial Facilities
Alert
10.01.2009
On September 30, 2009, the U.S. Environmental Protection Agency ("EPA") announced a proposal to phase-in greenhouse gas emissions permitting requirements under the Clean Air Act on large industrial facilities. This is the most significant agency-initiated development in air permitting since the passage of the Clean Air Act more than 30 years ago. This rulemaking proposal is being initiated in advance of EPA's issuance of a final rule regulating greenhouse gases (GHG) as a "pollutant," which final rule EPA states it expects to issue in March 2010.
Once GHGs are a listed as a pollutant, the Clean Air Act (CAA) triggers permitting requirements for potentially millions of GHG emitters. The proposed rule issued today is intended to provide a phased-in approach to those permitting requirements. In particular, the EPA proposal would require large industrial facilities that emit at least 25,000 tons of greenhouse gas emissions a year to obtain construction (CAA Prevention of Significant Deterioration ("PSD")) and operating (CAA Title V) permits for those emissions. The permits would be required to demonstrate the use of best available control technologies and energy efficiency measures to minimize greenhouse gas emissions when a facility is constructed or modified significantly. Similar requirements are already in place for conventional pollutants and these determinations often require a costly and prolonged analysis during the permitting process.
The proposed rule would only apply to large facilities -- including power plants, refineries, pulp and paper mills, chemical and other manufacturing facilities -- that EPA states are responsible for nearly 70 percent of the U.S. stationary source greenhouse gas emissions. Small businesses, including farms, restaurants and other small facilities, would not be included under the rule.
The proposed rules addresses the following six greenhouse gases: carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), hydroflurocarbons (HFCs), Perflurocarbons (PFCs) and sulfur hexafluoride (SF6).
Under the tailoring, phased-in approach proposed in this rule, EPA estimates that approximately 14,000 large sources would need to obtain operating permits that include greenhouse gas emissions and an estimated 400 new sources and modifications to existing sources would be subject to review each year for greenhouse gas emissions.
EPA will be accepting comments on the proposed rule for 60 days following Federal Register publication (expected shortly). Comments from affected facilities are critical in order to influence the agency's deliberations. A link to the proposed rule is provided.
Questions?
If you have questions regarding this proposed rule and the impacts that it may have for your company, please contact David Van Slyke, Jeff Talbert or Steve Hudson with Preti Flaherty's Climate Strategy Group at 207-791-3000. Before joining Preti Flaherty, David was a senior official in Environmental Protection Agency, Jeff litigated air permitting and compliance issues in the Environmental Enforcement Section of the Environment and Natural Resources Division of the Department of Justice in Washington, D.C. Steve has prepared permit applications, developed permit terms and conditions, and negotiated air compliance issues for various manufacturing facilities in multiple states.
About the Climate Strategy Group
With key expertise from our energy, environmental, intellectual property, business and legislative practice groups, Preti Flaherty's Climate Strategy Group helps clients deal with both the risks and the opportunities presented by climate change. The Group is made up of more than 15 attorneys, ensuring that the Climate Strategy Group has the resources and knowledge to assist Preti Flaherty's clients.