Beveridge & Diamond
 
Related Practices
Related Practices

EPA Begins to Revise Emissions Standards In Response to Sierra Club’s Vacatur of Startup, Shutdown, Malfunction Exemption

Beveridge & Diamond, P.C., October 30, 2009

This week, the U.S. Environmental Protection Agency (“EPA”) issued final rules amending the maximum achievable control technology (“MACT”) and generally available control technology (“GACT”) standards for petroleum refineries and chemical manufacturing facilities, respectively, and providing some insight into the manner in which it intends to regulate hazardous air pollutant emissions occurring during periods of startup, shutdown, and malfunction (“SSM”).

As B&D has previously reported, the EPA regulations that generally exempt SSM emissions from compliance with the National Emissions Standards for Hazardous Air Pollutants (“NESHAP”) — 40 C.F.R. §§ 63.6(f)(1) and 63.6(h)(1) (the “SSM Exemption”) — were invalidated by the D.C. Circuit last year in Sierra Club v. EPA, 551 F.3d 1019.   Following the court decision, EPA issued guidance interpreting the decision as affecting only those standards that both (i) incorporate the SSM Exemption by reference and (ii) contain no other text that provides SSM protections.  At the same time, however, EPA indicated it would reevaluate and possibly revise the similar SSM provisions that appear in many source category-specific NESHAPs in light of the court’s decision. Letter from A. Kushner to C. Knauss et al. re Vacatur of Startup, Shutdown, and Malfunction (SSM) Exemption (40 C.F.R. §§ 63.6(f)(1) and 63.6(h)(1)) (Jul. 22, 2009) (“Kushner Letter”).  See EPA Issues Guidance to Regulated Community on Startup/Shutdown/Malfunction Vacatur (Beveridge & Diamond, P.C.)

EPA has now begun this process, promulgating in two NESHAP rulemakings new standards that claim to address SSM emissions without reference to the SSM exemption vacated by the D.C. Circuit. 

First, on October 28, 2009, EPA amended the refinery MACT (40 C.F.R. Part 63, Subpart CC) to add new standards for heat exchange systems that will apply on a continuous basis, including during SSM events.  See 74 Fed. Reg. 55670, 55672 (Oct. 28, 2009).  According to the preamble accompanying the amendments, because these standards apply continuously, EPA has concluded that the Sierra Club decision does not affect their applicability.  Id.  The Agency did, however, reiterate its position in the Kushner Letter that the effect of the Sierra Club decision on other provisions of the refinery MACT “requires further analysis,” and that EPA is “currently evaluating how to address SSM events” under those provision “in light of the court decision.”  Id.  The Agency did not indicate any schedule or deadline for doing so. 

In another NESHAP rulemaking on October 29, EPA chose a slightly different approach to manage the effects of the Sierra Club decision.  Specifically, EPA promulgated new GACT standards for nine area source categories (i.e., sources whose emissions are lower than the 10 and 25 ton thresholds that trigger MACT standards) in the chemical manufacturing sector (40 C.F.R. Part 63 Subpart VVVVVV).  See 74 Fed. Reg. 56008, 56013 (Oct. 29, 2009).  Like the new heat exchanger standards, the area source standards in the new rule will apply on a continuous basis.  In one context, however, EPA established two standards — one that would apply during startup and shutdown and another that would apply at all times.  The two standards apply to continuous process vents, and require 85% control of emissions during startup and shutdown, and 95% control at all other times.  EPA justified the lower level of control applicable during startup and shutdown on the basis that those periods (which EPA described as involving “the filling, emptying, and inerting of vessels”) have “significantly different emissions than normal operations.”  Id.

This area source standard is EPA’s first attempt at addressing any kind of SSM emissions through a separate, enforceable limit applicable only during qualified SSM events.   Notably, EPA elected not to establish an alternative limit for periods of malfunction, and their rationale for that decision seems to indicate they are not likely to do so in other contexts.  Specifically, the agency noted in the preamble accompanying the new area source standards that, unlike startup and shutdown operations, which EPA described as “predictable and routine,” malfunctions are not “a distinct operating mode,” making it impractical for the Agency to account for them when calculating the emissions standard.

Both of the new standards are eligible for review for a 60-day period following their issuance (i.e., December 27, 2009 for the refinery MACT and December 28, 2009 for the chemical manufacturing sector area source standard).  See CAA § 307(b).  Some of the determinations in the rulemakings may be subject to statutory or constitutional arguments, especially given the rules’ overlap with the D.C. Circuit’s broad holding in the Sierra Club decision.  So, those covered by the rules should review them carefully in light of this 60-day limit for challenges.  Moreover, the rules are likely to set the precedent for how EPA will address SSM emissions in NESHAPs going forward, so even sources unaffected by these latest rules should be conscious of the outcome and ready to act quickly as EPA moves forward in addressing SSM emissions in other industrial sectors.

For further information on the SSM Exemption, please contact Stephen Richmond at SRichmond@bdlaw.com; Laura McAfee at LMcAfee@bdlaw.com; David Friedland at DFriedland@bdlaw.com; or Madeleine Kadas at MKadas@bdlaw.com

Overview

News

Presentations

Media Contact





Attorney Contacts
Attorney Contacts