During the week of January 18, 2016, the Department of Energy & Environment of the District of Columbia (“Department”) released a pre-draft proposal of its much-anticipated synthetic minor permitting regulations. The proposal will also establish and revise fees for permits, and through the administrative amendment process, allow for the incorporation of preconstruction permit requirements under Chapter 2 of Title 20 of the D.C. Municipal Regulations into Title V (Chapter 3) permits under the Clean Air Act.

Chapter 2: General and Non-Attainment Area Permits

Synthetic Minor Regulations

The Department proposes adding two new provisions, Sections 200.6 and 200.7, to establish the synthetic minor program. Section 200.6 will give the Department discretion to “establish a condition in an operating permit that limits emissions from a source so as to avoid applicability of the permitting requirements” of Chapter 3. Similarly, Section 200.7 will allow the Department to “establish a condition in an operating permit that limits emissions from a source so as to avoid applicability of a District or federal air quality regulation, other than the requirements [under Chapter 3], except when prohibited by another District or federal regulation.”

Companies that are required to procure air permits in the District of Columbia have always argued that the Department had the authority to impose limits in Chapter 2 permits that would restrict a source’s potential to emit even before these new proposed regulations. Thus, these proposed regulations merely state what many maintain was already within the Department’s discretion. In any event, these proposed regulations explicitly provide such authority. To the extent that the synthetic minor regulations are necessary, we have recommended to the Department that sources should be able to establish synthetic minor conditions in both construction and operating permits under Chapter 2, not just operating permits.

Fees under Chapter 2

The Department also will propose an entirely new section, Section 211, which establishes fees for the construction, modification, or operation of a stationary source or the air pollution control device at any stationary source. These fees range from $300 to $5,000 depending on the type of equipment or permit. In addition, Section 211.4 of this new section provides that those permits that contain a condition under Section 200.6 must pay the permit application fee of $5,000 under Section 305.5, as opposed to the permit fees under Section 211.

Chapter 3: Operating Permits and Acid Rain Programs

Synthetic Minor Regulations

The Department will propose revisions and additions under Chapter 3 as well. First, in Section 300.3(c) the Department adds a “synthetic minor” provision that exempts a source from Title V as long as the source accepts a condition pursuant to the new Section 200.6 and pays Chapter 3 permit fees.

Fees under Chapter 3

In addition, the Department will propose to repeal and replace Section 305, which deals with Title V permit fees. Section 305.1 will establish permitapplication fees that range from $5,000 to $30,000 based on the tons of total potential emissions. Section 305.2 will set annual fees that range from $1,000 to $30,000, depending on the total tons of actual emissions of each regulated pollutant. The definition for “regulated pollutants” for Section 305 only will be amended to exclude greenhouse gases. These new annuals fees will be subject to increases linked to the Consumer Price Index.

Additional Revisions

The Department will propose to add a provision under Section 303.4, the administrative permit amendments section, that incorporates into the Title V permit the requirements from Chapter 2 preconstruction permits, so long as those permits go through the already established enhanced notice and comment requirements necessary for initial permit issuance, significant modifications, and renewals under Section 303.10.

Finally, in Section 303.11, the Department will propose to change the venue for judicial review of any final action granting or denying an application for a permit, permit amendment or modification, or permit renewal from the Superior Court of the District of Columbia to the Office of Administrative Hearings.

The proposed rule is expected to be published in the D.C. Register in March or April 2016. Comments will be received for thirty days after publication. A final rule could be published as early as June 2016.