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EPA Sends Third Step of Greenhouse Gas Tailoring Rule to White House for Review

Wednesday, February 8, 2012

By Andrew Childers

The Environmental Protection Agency has sent a proposed rule on revisions to its greenhouse gas permitting program to the White House for review. The proposed rule is expected to solicit comments on the third step of the greenhouse gas tailoring rule.

EPA is expected to propose phasing in its prevention of significant deterioration and Title V greenhouse gas permitting programs for additional emissions sources and possibly setting lower permitting thresholds in 2016. The proposal also is expected to solicit comments on other steps to streamline the permitting process.

The proposed rule was sent Feb. 6 to the White House Office of Management and Budget for review, typically the last step before it is published in the Federal Register. EPA anticipates proposing the rule in March, according to its online regulation tracker.

EPA's June 2010 greenhouse gas tailoring rule limited permitting requirements to only those stationary sources with the greatest emissions (75 Fed. Reg. 31,514; 92 DEN A-7, 5/14/10).

Phase-in of Tailoring Rule

EPA has phased in the tailoring rule in two steps, with an enforceable commitment in that rule to propose a third step for its permitting program.

The first phase began Jan. 2, 2011, and required only those emissions sources already subject to prevention of significant deterioration or Title V permitting to obtain permits for their greenhouse gas emissions.

Beginning July 1, 2011, the second phase applied permitting requirements to stationary sources with greenhouse gas emissions of at least 100,000 tons of carbon dioxide-equivalent annually or those that made modifications increasing their emissions by at least 75,000 tons per year.

As part of the tailoring rule, EPA also committed to proposing a third step in the permitting process to begin June 30, 2013.

EPA said at the time that the proposal for the third phase could consider measures to streamline the permitting process and permanently exempt smaller sources from the requirement to obtain permits.

EPA said the third step would not require permitting for facilities with emissions less than 50,000 tons per year, until at least April 30, 2016.

EPA plans to complete a study on the burdens of permitting on smaller emissions sources by April 2015.

EPA did not immediately respond to a request for comment on the proposal.

EPA Defends Tailoring Rule

EPA will defend its tailoring rule as well as other greenhouse gas regulations during oral argument in the U.S. Court of Appeals for the District of Columbia Circuit Feb. 28 and 29 (05 DEN B-1, 1/10/12).

Industry groups and several states argue that the greenhouse gas rules are overly broad and do not fully consider the economic impact on affected businesses.

Moreover, they contend that EPA's tailoring rule violates the Clean Air Act because it alters the permitting thresholds specified in the statute (Coalition for Responsible Regulation v. EPA, D.C. Cir., No. 10-1092, oral argument scheduled 11/2/11).