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Tailoring Rule on Greenhouse Gases
Key Development: EPA did not revise the greenhouse gas permitting thresholds in the third step of its tailoring rule.
Potential Impact: EPA and states need additional time to develop permitting infrastructure and implement streamlining options before lowering the thresholds.
What's Next: The final rule will take effect 30 days after it is published.
The Environmental Protection Agency chose not to revise the permitting thresholds for greenhouse gas emissions in a final rule released July 3, but it did approve plantwide applicability limits for industrial facilities.
New facilities that emit 100,000 tons per year of carbon dioxide-equivalent and existing facilities that increase their emissions by 75,000 tons per year of carbon dioxide-equivalent will be required to obtain prevention of significant deterioration and Title V operating permits.
EPA said it is retaining those existing permitting thresholds because state permitting authorities need more time to develop the infrastructure necessary to issue greenhouse gas permits.
“Instead, in many cases, reductions in state environmental agency budgets have occurred, which is fully consistent with the overall reductions in state budgets that have been recently seen across the nation,” EPA said.
EPA plans to complete a study of the administrative burdens associated with the permitting requirements by April 30, 2015. The next review of the permitting thresholds is due to be completed by April 30, 2016, and EPA could revise the thresholds then.
Environmental groups had urged EPA to lower the permitting thresholds in their comments on the proposed rule. However, David Doniger, policy director of the Natural Resources Defense Council's Climate Center, told BNA July 3 that environmental groups generally support EPA's decision to address the largest emissions sources first. They will be closely watching EPA's review process in 2016, he said.
“Certainly, this holding things level knocks the legs out from under the feverish claims that EPA was on the march to get to hotdog stands,” Doniger said. “This signals that there's great reluctance on EPA's part to get beyond the largest sources.”
Maintaining the permitting thresholds through 2016 does give industry groups some certainty to begin planning investments, Howard Feldman, director of scientific and regulatory affairs at the American Petroleum Institute, told BNA July 3.
“It does definitely provide more certainty over that time period,” he said.
EPA Tailoring Rule Steps
• The first step of EPA's tailoring rule, which took effect Jan. 2, 2011, required sources that were already subject to prevention of significant deterioration requirements to obtain permits for their greenhouse gases if they emit 75,000 tons of carbon dioxide-equivalent a year.
• Beginning July 1, 2011, the second phase applied permitting requirements to all stationary sources with greenhouse gas emissions of at least 100,000 tons of carbon dioxide-equivalent annually or that made modifications increasing their emissions by at least 75,000 tons per year. The requirements applied to sources even if they were not previously subject to permitting for other pollutants.
• EPA chose not to revise those permitting thresholds for the third step of the tailoring rule. That will allow EPA and states more time to develop the necessary infrastructure to issue the permits and develop measures to ease the burden on regulators and industrial facilities.
• EPA plans to complete a study of the administrative burdens of the permitting program by April 30, 2015. The next review of the permitting thresholds is due to be completed by April 30, 2016, and EPA could revise the thresholds then.
The final rule is the third step in EPA's implementation of prevention of significant deterioration permitting for greenhouse gases.
The first step, which took effect in January 2011, required only those sources that were already subject to prevention of significant deterioration to obtain permits for their greenhouse gas emissions if they emit 75,000 tons of carbon dioxide-equivalent a year. Under the second step, effective in July 2011, all sources that emit 100,000 tons per year of carbon dioxide-equivalent and those that increased their emissions by 75,000 tons per year were required to obtain permits.
EPA proposed the third step of its tailoring rule March 8 (77 Fed. Reg. 14,226).
The final rule will revise 40 C.F.R. Part 52. It will take effect 30 days after it is published in the Federal Register.
Retaining the permitting thresholds will give states and EPA additional time to develop streamlined permitting approaches.
One streamlining option included in EPA's final rule will allow industrial facilities to obtain site-specific permits for their plantwide greenhouse gas emissions rather than for specific emissions points.
The permits can be issued on either a tons-per-year or a carbon dioxide-equivalent basis. The plantwide limits will allow those sources to make some modifications to their facilities without triggering the prevention of significant deterioration permitting requirements.
The final rule also will allow industrial facilities that are considered minor sources for other regulated pollutants but emit 100,000 tons per year of greenhouse gas emissions to retain their minor source status. That would exempt them from the more stringent major source emissions controls requirements.
“We believe that these actions could streamline PSD permitting programs by allowing sources and permitting authorities to address GHGs one time for a source and avoid repeated subsequent permitting actions for a 10-year period,” EPA said.
EPA chose not to finalize a provision that would have allowed sources in areas subject to federal implementation plans for greenhouse gases to obtain synthetic minor permits for their emissions. EPA chose not to finalize the option because commenters said it was not needed at this time.
Synthetic minor permits establish emission limits below the current prevention of significant deterioration thresholds but would be less complicated to obtain than a traditional permit.
EPA said it is considering other streamlining options such as setting emissions controls for various industrial sectors that can be presumed to be the best available control technology, encouraging the use of general permits, and encouraging electronic permitting.
Many of the streamlining approaches “will take several years to develop, requiring separate rulemaking both at the federal level, and then through state and local processes," EPA said.
EPA also has created a Clean Air Act Advisory Committee work group to explore options for easing the permitting burdens on states and industries. The work group is expected to report back to the agency in October.
EPA's final rule is available at http://www.epa.gov/nsr/documents/20120702fr.pdf.
For more information, contact Michael S. Brooks in EPA's Office of Air Quality Planning and Standards at (919) 541-3539 or email@example.com.
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