Seyfarth Synopsis: On August 5, 2020, the U.S. Environmental Protection Agency (EPA or Agency) released a final memorandum on “Guidance on Plantwide Applicability Limitation Provisions Under the New Source Review Regulations.”

The guidance memorandum is, according to EPA, intended to increase the use of an air permitting option little-used by, but potentially favorable to industry, by improving understanding of PAL by stakeholders. According to EPA, confusion caused by previous guidance has led to a relative low adoption rate in the 17 years PALs have been in existence; from industry’s prospective however, the process for obtaining a PAL is formidable, particularly because state permitting agencies have little or no experience with PALs and are reluctant to take the “leap of faith” necessary to make PALs attractive to industry.

PALs are an optional, flexible permitting mechanism that involves the establishment of a plantwide emissions limit, (in tons per year), for specific pollutants. Once established, changes to facility operations that affect that pollutant can forego New Source Review (“NSR”), a costly and time consuming process for industry. The PAL provides a permittee the ability to manage process changes (modifications) without triggering major NSR and the need to conduct project-by-project major NSR applicability analyses. To qualify a PAL, EPA’s regulations require a source to conduct monitoring, recordkeeping and reporting of the actual emissions of a PAL pollutant on a 12-month rolling basis (which most sources do already).

While industry is generally familiar with the option, EPA’s guidance appears to be intended to address specific concerns raised by non-permittee “stakeholders” on the PAL provisions and to generally improve the understanding of PALs by the public. According to EPA, particular concerns raised by stakeholders are addressed in the guidance, and include discussions of : (1) PAL Permit Reopening, (2) PAL Expiration, (3) PAL Renewal, (4) PAL Termination, (5) Monitoring Requirements for PALs, (6) Emission Factor Adjustment, (7) Validation Testing, (8) Missing Monitoring Data, (9) Baseline Actual Emissions for Replacement Units, and (10) General Advantages of PALs and Other Considerations.