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Nov. 18 — States are planning very different responses to a 2015 Environmental Protection Agency rule requiring revisions to their emissions mitigation plans, with some opting for a path that will likely draw litigation from environmental advocates.
The EPA gave 36 states until Nov. 22 to submit a revised state implementation plan for addressing excess emissions during periods of startup, shutdown and malfunction. The agency required them to remove previously approved language that exempts industrial facilities from compliance with emissions standards during those periods and affirmative defense provisions that shielded those facilities from being assessed civil penalties associated with any violations resulting from unavoidable equipment malfunctions.
In advance of that deadline, Bloomberg BNA surveyed state environmental agencies on their planned responses to the rule, which is known as a SIP Call. While some states opted to simply remove language the EPA identified as being deficient, other states established work practice standards that industrial facilities can comply with instead of numerical emissions limits, an approach opposed by environmental advocates. In addition, several states, including Iowa, Alabama and West Virginia, told Bloomberg BNA that they won’t meet the EPA’s response deadline.
Environmental advocates are keeping a close eye on those state responses, as well as the EPA’s eventual decisions on whether to approve or disapprove of the revised state plans, decisions that likely will be left for President-elect Donald Trump’s administration. Seth Johnson, an Earthjustice attorney involved in litigation over the SIP Call rule (RIN 2060-AR68), indicated environmental organizations are prepared to step in with lawsuits if the EPA is slow to act on the state plans or if the agency approves revisions that are inconsistent with the law.
“The administration got this one right on the law and on the policy,” Johnson told Bloomberg BNA. “If there’s backsliding, we’ll be there to hammer them.”
Those possible lawsuits would add to a long history of litigation over exemptions and affirmative defenses under the Clean Air Act. The EPA based its justification for the SIP Call on federal court decisions and many states and industry organizations are challenging the rule in the U.S. Court of Appeals for the District of Columbia Circuit ( Walter Coke Inc. v. EPA, D.C. Cir., No. 15-1166, 6/12/15 ).
The exemptions and affirmative defense provisions included in the state implementation plans were at one time approved by the EPA as a way to address startup and shutdown periods, when pollution controls are not as effective as during normal operation, and during times of unavoidable equipment malfunctions. However, the agency altered its thinking on the legality of the plans after the following D.C. Circuit decisions:
Environmental advocates view the removal of exemptions and affirmative defenses as a positive development that will close loopholes allowing companies to exceed their permitted emissions limits without any repercussions or threat of enforcement action, according to Ilan Levin, associate director of the Environmental Integrity Project. That organization is part of an environmental coalition that is intervening in the litigation over the SIP Call in defense of the EPA.
“Getting those loopholes off the books is really one of the most important things,” Levin told Bloomberg BNA. “It’s going to clarify enforcement and it’s going to make it easier for people who live next door or downwind of one of these facilities to take matters into their own hands: to go to court if they need to.”
While the EPA and some states have said that they’ll rely on case-by-case enforcement discretion in lieu of affirmative defenses for malfunctions, that would not prevent advocacy groups from filing citizen lawsuits against power plants, refineries and other industrial facilities if they were to exceed their permitted emissions limits.
State environmental agencies contacted by Bloomberg BNA reported several different strategies for responding to the SIP Call. One reason for that is because the language identified under the SIP Call varied by state.
For example, Montana responded by revoking provisions that only applied to a single facility that shut down several years ago, a spokeswoman for the state’s Department of Environmental Quality told Bloomberg BNA in an e-mail. Meanwhile, Louisiana’s response required a more extensive effort, including five different new proposed regulations that removed older exemptions that no longer applied to any facilities and the establishment of new work practice standards for startup and shutdown, according to Bryan Johnston, an environmental scientist in the department’s Air Permits Division.
Louisiana’s agency was one of several that told Bloomberg BNA it planned to establish work practice standards, an alternative compliance method that allows facilities to meet their emissions obligations without being subject to a numerical emissions limit. Karen Hays, chief of the Air Protection Branch of the Georgia Environmental Protection Division, told Bloomberg BNA in an e-mail that sources in Georgia also will have the option of complying with work practice standards, while a spokesman for the Ohio EPA said in an e-mail that the state is trying to draft work practices in response to the SIP Call.
Other responses planned by states include establishing alternate numerical emissions limits, relying on the enforcement discretion of state agencies, and revising state plans while leaving exemptions on the books in state regulations.
Alternative work practice standards are a preferred approach for regulated entities because they are realistic about what facilities can actually do to minimize emissions during periods of startup, shutdown and malfunction, according to Megan Berge, a partner with Baker Botts LLP in Washington, D.C. Berge’s practice focuses on environmental law, including litigation, rulemaking and permit appeal.
“They are squarely within the definition of emissions limitations,” Berge told Bloomberg BNA.
Work practice standards are found in various Clean Air Act regulations, according to Richard Alonso, a partner at Bracewell LLP and a former enforcement official at EPA.
Alonso told Bloomberg BNA that work practice standards could be as simple as doing what is necessary to minimize emissions or maintaining pollution control devices. He said he would be “curious to see” the reaction of environmental advocacy organizations if the EPA approved revised state plans that included broad work practice standards.
Levin of the Environmental Integrity Project and Johnson of Earthjustice both expressed skepticism about the effectiveness and enforceability of work practice standards for periods of startup, shutdown and malfunction.
“It’s going to be difficult for states to implement and enforce the so-called work practice standards because they tend to be vague,” Levin said. “It’s a lot easier to enforce a numeric standard, like a limit.”
Johnson said that “vague general duty provisions” do not qualify as enforceable emissions standards, but instead serve as another type of exemption from regulation. He pointed to an intervenor brief filed by environmental groups in the Walter Coke litigation, which describes the tendency of courts to refuse to enforce unquantifiable standards and a history of unsuccessful attempts to convince the courts to enforce general duty and other work practice provisions in state implementation plans.
Several states told Bloomberg BNA that they did not intend to meet the Nov. 22 response deadline. While some, like Ohio and West Virginia, said their state rulemaking process made meeting that deadline impossible, Iowa and Alabama both voluntarily chose to not respond.
Iowa decided to not make any rule changes or submit any revisions requests to the EPA given the active litigation over the SIP Call rule, according to a spokeswoman for the state’s Department of Natural Resources.
Alabama also won’t meet the Nov. 22 deadline, though “all options” are on the table, according to Ron Gore, chief of the Air Quality Division at the Alabama Department of Environmental Management. Gore told Bloomberg BNA that the state was not planning to submit anything to the EPA in November and may choose to wait to review what other states have done and what approaches the EPA decides to approve.
However, Gore noted that “there is at least some possibility that we will never submit anything and let EPA do what it may.”
If a state does not submit a plan revision, the EPA can issue what is called a finding of failure to submit, a regulatory decision that triggers an obligation for the EPA to impose a federal implementation plan within two years. The same two-year clock is started if the EPA were to disapprove of a state plan submission.
While the states crafted their revisions in response to an Obama-era regulation, those revisions will be reviewed and judged by a Trump administration. It remains to be seen how quickly Trump’s EPA would act against states that don’t submit plans, what the agency would consider approvable as a plan revision and how the government will handle the ongoing litigation before the D.C. Circuit.
During the campaign and in the wake of his election, Trump pledged to reduce the number of regulations on the books and rescind several high-profile Obama-era environmental regulations, including the Clean Power Plan standards for existing power plants. While Trump has not commented on the SIP Call rule, his pick to serve as attorney general, Sen. Jeff Sessions (R-Ala.), was critical of the EPA back when the agency proposed the SIP Call in 2013.
Alonso predicted that the new administration will likely be “much more deferential” to the states when it comes to environmental policy, including in the review of revised plans submitted under the SIP call.
“I think the election definitely changed the way that this SIP Call is going to be implemented,” Alonso said. “I think the really big story here is that you’re going to have a new team at EPA that is going to be reviewing these and looking at them in a totally different light than the previous administration.”
Alonso identified the approach taken by Texas as one that may not have been approvable by the Obama administration, but might be sufficient for a Trump EPA.
Texas, which is one of the states challenging the SIP Call in federal court, adopted amendments that clarify any affirmative defenses in its environmental regulations are not intended to limit the jurisdiction or discretion of federal courts, according to a spokeswoman for the Texas Commission on Environmental Quality. Even that clarifying language will not be applicable until litigation over the SIP Call is complete, the spokeswoman told Bloomberg BNA in an e-mail.
“Although TCEQ responded to the [startup, shutdown, malfunction] SIP Call with rulemaking, it does not anticipate any changes to its policies and procedures for responding to emissions events violations,” the spokeswoman said.
Levin of the Environmental Integrity Project said that while it’s too early to say what the Trump EPA will do on the SIP Call issue, environmental advocates will be watching the EPA’s decision making “very closely.”
“I expected that there will be some more litigation, unfortunately,” he said. “But we’ve already moved the ball so far forward on this particular issue that we’re not going to let up.”
With the ongoing litigation in the D.C. Circuit and more litigation possible from environmental groups, regulated industries are facing continued uncertainty regarding the handling of emissions during startups, shutdowns and malfunctions, according to Berge of Baker Botts.
“Really the best thing I can tell industry members is to engage with their states, be aware of any regulatory changes on the state and federal level and to manage their permits,” Berge said.
To contact the reporter on this story: Patrick Ambrosio in Washington, D.C., at PAmbrosio@bna.com
To contact the editor responsible for this story: Larry Pearl at email@example.com
Copyright © 2016 The Bureau of National Affairs, Inc. All Rights Reserved.
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