Coal Ash Rule Update: USEPA Proposes to Approve Georgia Permit Program Against Backdrop of the USWAG Remand

In previous Coal Ash Rule Updates, the authors have reported on the United States Environmental Protection Agency's (USEPA) attempts to encourage states to develop their own permit programs for the management of coal combustion residuals (CCR or Coal Ash). In 2017, USEPA even released a step-by-step guidance document for states to follow in developing such programs. In order to gain USEPA approval for a permit program under the Coal Ash Rule, a state must prove that its program is "at least as protective" as the federal requirements. Until recently, Oklahoma was the only state to seek USEPA approval for a CCR permit scheme.

The authors also reported on a lawsuit filed by a group of Non-Governmental Organizations (NGO) challenging the USEPA's Coal Ash Rule as inconsistent with the Resource Conservation and Recovery Act (RCRA), United Solid Waste Activities Group v. Environmental Protection Agency (the USWAG case). In August, 2018, the DC Circuit struck down certain provisions of the Coal Ash Rule on the grounds that those provisions were not sufficiently protective of health and the environment. The USWAG case is currently on remand to USEPA, which is working on proposed changes to the Coal Ash Rule designed to implement the DC Circuit's ruling in USWAG.

Post-USWAG, it remained unclear how a state which was considering a permit program might account for the fact that the final contours of the Coal Ash Rule will not be known until after the EPA revises the Coal Ash Rule, and potentially not until after the DC Circuit further rules on those revisions. The recently-announced Georgia CCR Permit Program provides a potential model for how states might navigate this regulatory uncertainty.

Background

Before the Coal Ash Rule became effective in 2015, CCR was exempt from regulation under RCRA. In describing the impact of decades of unregulated storage and disposal of coal ash, the DC Circuit in the USWAG decision stated that, as of 2012, there were at least 310 CCR landfills and 735 CCR surface impoundments in the United States. On average, a CCR landfill spans more than 120 acres and is 40 feet deep. The DC Circuit observed that CCR landfills and impoundments were at risk for structural failure and had the potential to create groundwater contamination.

The Coal Ash Rule was USEPA's attempt to provide a regulatory framework for management of CCR. It brought CCR under subtitle D of RCRA. Unlike subtitle C of RCRA (which provides for federal regulation of all stages of production and disposal of hazardous waste and has administrative enforcement provisions), subtitle D is self-implementing, meaning that USEPA lacks the statutory authority to address all but the most blatant of RCRA violations at subtitle D facilities. Subtitle D, however, calls on USEPA to promulgate criteria to distinguish "sanitary landfills" which are allowed under subtitle D, from "open dumps" which are allowed under any section of RCRA.

The statutory baseline for USEPA's criteria is that, at a minimum, a facility may be classified as a sanitary landfill and not an open dump only if "there is no reasonable probability of adverse effects on health or the environment from disposal of solid waste in such a facility." In the USWAG case, the NGOs argued certain aspects of the Coal Ash Rule actually did result in a "reasonable probability of adverse effects" on human health and the environment and, therefore, certain types of CCR impoundments were not "sanitary landfills" subject to the less stringent requirements of subtitle D, but rather prohibited "open dumps." The DC Circuit, in large part, agreed.

The Court held that the Coal Ash Rule was inconsistent with RCRA in a number of ways, including:

• Not requiring operators of existing unlined surface impoundments to install liners until after a leak is detected.
• Allowing the continued use of clay liners in existing coal ash ponds.
• Exempting so-called "legacy ponds" (inactive impoundments at inactive sites) from any regulation under the rule.

The upshot of the DC Circuit's opinion is that many currently existing CCR surface impoundments are not in compliance with RCRA, and therefore are arguably subject to immediate closure. USEPA sought remand without vacatur arguing that it was expeditiously proceeding with a new rulemaking intended to address the DC Circuit's USWAG decision and that requiring immediate closure of hundreds of coal ash impoundments would be disruptive to the industry and the economy. On March 13, 2019, the DC Circuit granted remand without vacatur, but stated "we are confident that EPA will, as represented, expedite its rulemaking proceeding on remand to the fullest extent possible." It is not difficult to envision that, once USEPA announces its further rulemaking under the Coal Ash Rule, additional challenges will be filed and further court decisions will continue to shape what types of Coal Ash disposal facilities are, and are not, permissible under RCRA.

The Proposed Georgia Program

In order to obtain approval for a Coal Ash disposal permit program, a state must prove that the program is "at least as protective as" the USEPA's Coal Ash Rule. With the final contours of the Coal Ash Rule uncertain, states face the challenge of anticipating the eventual scope of the rule and making their proposed programs "at least as protective as" disposal rules which have yet to be promulgated.

One of the chief incentives for states to establish their own permit programs is enforcement. Once a state-level program is approved by USEPA, USEPA and the state gain the regulatory authority to enforce its permits. Without a state-level permit program, subtitle D may only be enforced by way of citizen suits. Once a state-level program is in place, a citizen suit will be barred under Section 7002 of RCRA if USEPA or the state pursues an enforcement action. Presumably, states and utilities prefer the relative predictability of a federal or state-level enforcement action to the potential expense of citizen suit litigation and the potential for inconsistent rulings by different courts.

Georgia both enhanced its chances of gaining USEPA approval for its permit program and ensured itself a reasonable degree of flexibility in the future by simply adopting by reference nearly all of the technical criteria set out in the USEPA's Coal Ash Rule. For example, the "Definitions" section of the proposed Georgia rule simply states "Definitions in 40 C.F.R. 257.53 are incorporated by reference into this section and are applicable to CCR units with the following exceptions...," and the Location Restrictions provisions reads "New CCR landfills, existing and new CCR impoundments, and all lateral expansions of CCR units must meet the location restrictions in 40 C.F.R. 257.60...." Other provisions are similar. They simply adopt, in whole or in part, the federal Coal Ash Rule provisions as the Georgia equivalent. The Georgia regulations also contain additional, state-specific rules for groundwater monitoring and corrective action, closure and post-closure care, recordkeeping, notification and a handful of other issues.

The proposed Georgia program deals with the USWAG decision by expanding its definition of regulated surface impoundments to include inactive impoundments at inactive facilities. These facilities will be treated as new surface impoundments and the owners and operators will be required to apply for new permits. Georgia did not address the USWAG court's ruling on clay-lined impoundments because there are no clay-lined impoundments in Georgia. Likewise, Georgia did not address unlined impoundments at active facilities because all such impoundments in Georgia are scheduled to cease receiving CCR in 2020.

Georgia, therefore, has taken a practical approach to obtaining approval of its CCR permit program, even against the backdrop of the USWAG remand. It incorporated large sections of the Coal Ash Rule provisions by specific CFR citation. If the federal rule changes as a result of further rulemaking, the Georgia rule will automatically change right along with the federal rule. Georgia also took a conservative approach to "legacy ponds" by regulating them as new facilities requiring new permits. Georgia basically left unaddressed the facilities which are either scheduled to close or which do not exist in Georgia.

"EPA encourages other states to follow Georgia's lead and assume oversight of coal ash management within their borders," EPA Administrator Andrew Wheeler said in a statement. "EPA is committed to working with the states as they establish coal ash programs tailored to their unique circumstances that are protective of human health and the environment."

Conclusion

One of the few certainties surrounding the Coal Ash Rule is that it will change in the future. USEPA is currently "expeditiously" rewriting portions of the rule in reaction to the USWAG decision, and further court challenges are not out of the question. By adopting the technical requirements of the Coal Ash Rule by CFR citation, Georgia ensured that its permit program will remain consistent with the federal Coal Ash Rule, even as the federal rule changes. Meanwhile, as utilities continue the process of data collection and plan implementation, the interested parties on all sides will remain actively engaged as this continues to unfold.