In a July 24 memorandum, two EPA assistant administrators announced that following last month’s Supreme Court decision prohibiting EPA from imposing Clean Air Act permits solely for greenhouse gases (GHG), (drumroll) “EPA Will Follow the Law” (ta da!). Seriously, in a six page memorandum, the two assistant administrators explained to EPA Administrator McCarthy that EPA would not require either of two permits (Title V permit and a prevention of significant deterioration (PSD) permit) for either a new or existing source solely for their potential to emit GHG. For existing sources which already have such permits for other pollutants, or will be required to secure them for increases of such emissions, GHG limitations will still be imposed. The memorandum was a straightforward, and surprisingly clear, recitation of the Court’s decision.
The memo also explains those situations in which EPA will impose restrictions on GHG emissions. For currently permitted existing sources, EPA will restrict “GHG emissions if the source emits or has the potential to emit 75,000 tons per year (tpy) or more of GHG on a carbon dioxide equivalent (C02e) basis.” For modified sources, the EPA will apply PSD requirements to “GHG if the modification is otherwise subject to PSD for a pollutant other than GHG, and the modification results in a …net GHG emissions increase equal to or greater than 75,000 tpy C02e and greater than zero on a mass basis.” (June 24 Memorandum at 3). As an example, a coal mine which currently has no air quality permit need not seek one simply because it emits the GHG methane, from ventilation boreholes. If it has a thermal dryer which does have an air permit, the thermal dryer may also be regulated for methane emissions.
This conclusion does not mean that states cannot regulate such existing sources for GHG if an independent basis exists for doing so exclusively under state law (and EPA makes it clear that is intends to review this with state and local authorities). EPA cannot obligate the states to do so, however, under the programs (State Implementation Plans) by which they enforce the CAA within their boundaries.
Future EPA GHG Regulations Likely
The restrictions placed upon EPA by the Court’s UARG decision does not mean that the agency will abandon all work now underway on evaluating GHG permitting data. It will continue to evaluate GHG data for “the possible development and justification of an appropriate GHG significance (or ''de minimis") level for determining the application of PSD requirements to GHG in permitting” those sources which may lawfully be permitted for other pollutants. Likewise, biogenic sources of GHG, particularly methane, will continue to be evaluated notwithstanding EPA’s inability to impose permits solely for GHG for those sources. In fact, when one reviews a report released on Friday, July 25 by EPA’s Office of Inspector General on methane leakage from existing natural gas pipeline systems, it is obvious that EPA will be brooding deeply over the remaining years of the Obama Administration to regulate sources now made off-limits by the UARG decision.
Although EPA may not impose permits for GHG on sources not currently permitted, this adventure in environmental regulation is just beginning. Given the significant reductions that the states will need to impose on coal-fired power plants under EPA’s June 18 proposed rule, and the opportunity for the states to employ controls on other GHG sources as part of their strategies, there is every likelihood that creative GHG restrictions will be proposed in the coming months and years.
This article was authored by Blair M. Gardner, Jackson Kelly PLLC. For more information on the author, see here.