The EPA has closed out 2019 by issuing several important documents related to permitting of sources under the Clean Air Act (“CAA”). The documents relate to permits issued under both the operating permit program (“Title V” or “CAAPP” permits) and the pre-construction permit program (prevention of significant deterioration (“PSD”), permits in areas that have attained the national ambient air quality standards (“NAAQS”) and non-attainment new source review (“NSR”) permits in areas that have not attained the NAAQS.

Reasonable Possibility Reconsideration

On November 5, the EPA sent a letter to the New Jersey Attorney General about the “reasonable possibility” rule issued in 2007 (the “2007 Rule”). The 2007 Rule required recordkeeping for certain projects determined not to be major modifications triggering the NSR/PSD provisions but that could nevertheless result in a significant emissions increase.

The EPA had announced in 2009 that it would undertake a discretionary reconsideration of the 2007 Rule based on a petition from New Jersey. The November 5 letter announced that the EPA had ended its discretionary reconsideration and was no longer considering making any changes to the 2007 Rule. The November 5 letter also stated that the EPA was no longer accepting comments (even though the EPA never requested comments on the reconsideration in a Federal Register notice) because the 2007 Rule was a “logical outgrowth” of the EPA’s proposed rule. Watch for New Jersey to require additional recordkeeping itself or to challenge the EPA’s November 5 decision in court.

Correction Rule

On November 22, the EPA issued its NSR/PSD Correction Rule Proposal. The Correction Rule proposes non-controversial, non-substantive and conforming changes to the NSR/PSD regulations. The rule proposes to:

  • Correct typographical and spelling errors;
  • Remove court vacated rule language;
  • Remove or update outdated and incorrect cross references; and
  • Conform certain provisions to changes in the CAA 1990 amendments.

The EPA has proposed allowing states with approved programs to make changes in conjunction with other SIP submittals. We previously wrote about the correction rule last spring. The Correction Rule Proposal was published in the Federal Register on December 20, and comments will be accepted until January 21, 2020.

Interpretation of 'adjacent'

On November 26, the EPA issued its Final Guidance on what it means for two or more facilities to be considered “adjacent” for Clean Air Act permitting purposes.[1] Going forward, the EPA (and those states that follow the EPA’s lead) will consider physical proximity only, not functional interrelatedness, when deciding whether two or more facilities are adjacent. The EPA concluded that its new interpretation “is a more objective and reasonable approach, and one that is more consistent with the dictionary meaning of ‘adjacent’ and the ‘common sense notion of a plant.’” Although a “bright line” test or fixed distance was not included in the new interpretation, it is unlikely that facilities separated by any substantial distance will be identified as adjacent going forward. We had previously published an article about the proposed guidance last year that describes the history of the EPA’s interpretation of “adjacent” and the reasons for the change.

Definition of ‘ambient air’

On December 3, EPA Administrator Wheeler issued a final Revised Policy on Exclusions from Ambient Air. The phrase “ambient air” is important under the CAA because the NAAQS for which monitoring and modelling may be required only apply to ambient air. The EPA’s regulations define the phrase “ambient air” as “that portion of the atmosphere, external to buildings, to which the general public has access.” See 40 C.F.R. § 50.1(c).

Since 1980, the EPA has interpreted the regulatory definition as exempting “the atmosphere over land owned or controlled by the source and to which public access is precluded by a fence or other physical barriers.” The new guidance explains that other measures that effectively restrict access by the public, potentially in combination with physical barriers, may now be used. Examples of such measures that may be effective in precluding access to land by the general public include, but are not limited to, “no trespassing” signs, video surveillance, and increased security patrols (in person or using drones). Since the EPA promulgated the revised policy as guidance, challenges to the new policy will need to wait until after either the EPA or a state, local or tribal air agency makes an ambient air determination about a particular source.

Streamlining procedures for permit appeals

The December 3, 2019 Federal Register contained an EPA proposal to streamline the permit review process. The proposal would create a new time-limited alternative dispute resolution (“ADR”) process as a prerequisite to review of permit decisions. The proposal would also limit the authority of the Environmental Appeals Board (“EAB”), change the process the EAB uses to consider appeals of permit decisions, and remove provisions allowing amicus curiae to participate in appeals to the EAB. Comments on the proposal are due by January 2, 2020.

Other upcoming changes

The EPA may also finalize two other previously announced changes by the end of the year. First, the EPA has announced it will be issuing a cost/benefit rule to improve consistency, reliability, and transparency of its treatment of Clean Air Act provisions related to costs and benefits. The EPA has said this action will provide the public with a better understanding on how EPA is evaluating benefits and costs when developing Clean Air Act regulatory actions and allow the public to provide better feedback to EPA on potential future proposed rules. We previously wrote about the cost/benefit rule in May 2019.

Second, the EPA has recently announced plans to take final action on the 2016 proposed revisions to the Title V Program. According to the EPA, the revisions will “streamline and clarify” the regulations related to petitions to EPA challenging Title V permit actions.