BEIJING BOSTON BRUSSELS CHICAGO DALLAS FRANKFURT GENEVA HONG KONG HOUSTON LONDON LOS ANGELES NEW YORK PALO ALTO SAN FRANCISCO SHANGHAI SINGAPORE SYDNEY TOKYO WASHINGTON, D.C.
What’s New with New Source Review?
April 3, 2014
Whats New with New Source Review? April 3, 2014 Prevention of - - PowerPoint PPT Presentation
BEIJING BOSTON BRUSSELS CHICAGO DALLAS FRANKFURT GENEVA HONG KONG HOUSTON LONDON LOS ANGELES NEW YORK PALO ALTO SAN FRANCISCO SHANGHAI SINGAPORE SYDNEY TOKYO WASHINGTON, D.C. Whats New with New Source Review? April 3, 2014
BEIJING BOSTON BRUSSELS CHICAGO DALLAS FRANKFURT GENEVA HONG KONG HOUSTON LONDON LOS ANGELES NEW YORK PALO ALTO SAN FRANCISCO SHANGHAI SINGAPORE SYDNEY TOKYO WASHINGTON, D.C.
April 3, 2014
PSD: Where the action is… .
2
§7475
– Applies to the construction of new, or to “major modifications” of existing, “major stationary sources” of air pollutants – Applies in areas that meet the National Ambient Air Quality Standard (NAAQS) for the pollutant in question – Triggered by “physical change” or “change in the method of operation” that causes a “significant net emissions increase” of a NAAQS pollutant – Imposes significant, expensive, and time-consuming
control technology (BACT)
3
.
– EPA brought suits in a number of industrial sectors (pulp & paper, petroleum, cement) – Hit its stride in 1999: EPA/ DOJ announced their Coal- Fired Power Plant PSD/ NSR Enforcement Initiative – Often, EPA asserts PSD/ NSR claims based on actions (alleged major modifications) that occurred decade(s) earlier – Has resulted in some of the largest fines and most costly corrective measures of any environmental enforcement program
4
– Statute of Limitations (“SOL”) – NSR Reform Rules
5
– Widespread consensus among courts that general federal 5 year SOL applies
action, suit or proceeding for the enforcement of any civil fine, penalty, or forfeiture, pecuniary or otherwise, shall not be entertained unless commenced within five years from the date the claim first accrued … ” – Theory: violation is discrete, one-time failure to obtain preconstruction permit
permit violations do not constitute violations that continue past the completion of construction.” [ 245 F. Supp. 2d 951, 956 (S.D. Ill. 2003)]
6
– Private plaintiffs:
502 F.3d 1316 (11th Cir. 2007)
Ind., Sept. 14, 2010)
– Government plaintiffs:
seeking injunctive relief beyond 5 years – See, e.g., U.S. v. Murphy Oil, 143 F. Supp. 2d 1054, 1080 (W.D.
7
Times, they are a-changin’… …
8
2013)
for alleged violations accruing more than 5 years earlier
– But, in both, intervening transactions occurred
9
PSD violations for modifications by former owner in 1990s without PSD permit*
* Agencies also asserted a claim for a project undertaken by current owner; it was not before the Court so we won’t be discussing it.
10
694 F.Supp.2d 999 (N.D. Ill. 2010)
– Civil penalties: time-barred – Injunctive relief: former owner cannot be compelled to modify sources it no longer owns and has no right to access
– Civil penalties: time-barred – Injunctive relief: §7475 prohibits the construction of a major emitting facility without a permit; it does not prohibit subsequent operation of the facility
11
720 F.3d 644 (7th Cir. 2013)
reasoning
– 5 year SOL applies for penalties and injunctive relief
passed since the modifications were finished, at least double the five-year period of limitations.” [ 720 F.3d at 646]
proceed as if it possessed all required construction permits” [ 720 F.3d at 648]
alleged violations
12
– “The violation is complete when construction commences without a permit in hand. Nothing in the text of §7475 even hints at the possibility that a fresh violation occurs every day until the end of the universe if an owner that lacks a construction permit operates a completed facility.” [ 720 F.3d at 647]
– “What these plants emit today is subject to ongoing regulation under rules other than §7475. Today’s emissions cannot be called unlawful just because of acts that occurred more than five years before the suit began.” [ 720 F.3d at 648]
13
several power plants alleging PSD violations for modifications made by former owner in 1990s without PSD permit and without installing BACT
14
727 F.3d 274 (3d Cir. 2013)
– PSD is a pre-construction program imposing one-time requirements – No continuing violation for operating post-construction
against a person who ‘operates’ a source without satisfying applicable PSD requirements.” [ 727 F.3d at 285]
15
– No relief available because did not violate anything
– Penalties barred by 5 year SOL – No injunctive relief either
violation; here violation is complete so nothing to enjoin
causes ongoing harm.” [ 727 F.3d at 291]
16
undertook the modifications matter to the Courts?
– Nat’l Parks and Conserv. Assoc. v. Tenn. Valley Auth., 480 F.3d 410 (6th Cir. 2007)
to impose on-going requirements in their PSD programs (i.e., “may not construct or operate without permit… ”), violation is continuing and enforcement is possible
17
– Time constraints for pursuing actions
claims like failure to submit notices?
18
– Among other things, changed way sources can calculate “significant net emissions increases” – “Major modifications”: a change that causes an actual increase in emissions
19
calculated “projected actual emissions” post-project; concluded NSR was not triggered
modification
– EPA disagreed with utility’s pre-project emissions projection and extent it relied on demand growth exclusion
20
711 F.3d 643 (6th Cir. 2013)
– EPA cannot “second-guess” operator’s emissions projection – But, EPA is not categorically prevented from challenging violations
complied with the regulations “at a basic level” – Rejects EPA’s argument that operators may not control post- project emissions to avoid triggering NSR
level”
21
March 3, 2014)] :
– EPA is only entitled to a “surface review” of operator’s pre-project projections – “Anything beyond this cursory examination would allow EPA to ‘second-guess’ a source operator’s calculations; an avenue which the Sixth Circuit explicitly foreclosed to regulators.” [ at 2-3] – Operator followed requirements
time of litigation, existing data showed that actual emissions did not increase!
22
– Pre-project projections showing a significant net increase?
– Pre-project projections showing no emissions increase, but an actual post-project increase occurs as a result of the project? – No pre-project projection is made?
23
– SOL concerns for injunctive relief in historical modification cases – Proof will be more difficult on post-2002 projects
24
BEIJING BOSTON BRUSSELS CHICAGO DALLAS FRANKFURT GENEVA HONG KONG HOUSTON LONDON LOS ANGELES NEW YORK PALO ALTO SAN FRANCISCO SHANGHAI SINGAPORE SYDNEY TOKYO WASHINGTON, D.C.
April 3, 2014
the US”
– Limits and prohibitions on discharges – Permitting requirements (e.g., NPDES, stormwater, construction) – Release reporting
26
27
28
29
30
subject of intense litigation, guidance and rulemaking
– Solid Waste Agency of Northern Cook County v. US Army Corps of Engineers (SWANCC), 531 U.S. 159 (2001) – Rapanos v. United States, 547 U.S. 715 (2006) – Draft Guidance in April 2011 - withdrawn
31
days after publication
32
– “Jurisdictional”: categories automatically included without additional analysis required – “By determination”: “other waters” included following a case-by-case determination
33
– Traditional navigable waters – Interstate waters, including interstate wetlands – Territorial seas
34
– Impoundments of traditional navigable waters, interstate waters (including interstate wetlands), territorial seas, and tributaries of such waters – Tributaries of other “waters of the US” – Adjacent waters, including adjacent wetlands
35
– Case-by-case determination, showing: – Alone or in combination with other “similarly situated” waters in the region … – “Significant nexus” to the Big Three
36
descriptions:
uplands with less than perennial flow
37
38
39
40
”
President Obama is no friend of private property rights or Oklahoma’s economy.”
41
activities and proposed activities
facility:
– Start early to allow necessary time to consider/ address potential impacts and issues – Allow time to get necessary determinations or permits – Document conclusions and bases for same
42
bodies/ areas near your facilities are or may be “waters of the US” so you will know whether emergency reporting might be required in the event
43
BEIJING BOSTON BRUSSELS CHICAGO DALLAS FRANKFURT GENEVA HONG KONG HOUSTON LONDON LOS ANGELES NEW YORK PALO ALTO SAN FRANCISCO SHANGHAI SINGAPORE SYDNEY TOKYO WASHINGTON, D.C.
April 3, 2014
– 1977 –
– 1978 – Policy
applicable standard
– EPA spends next decades refining position via guidance
– Attempts to reconcile CAA requirement that sources “continuously” meet emissions limitations with operational realities
45
– Affirmative defenses available – Agencies can use enforcement discretion – Guidances did not alter existing approved SIP provisions
during SSM events(2001 clarification)
46
12459)
– In response to 2011 Sierra Club petition
CAA mandate that emissions limitations be continuously met
47
– All excess emissions during startup/ shutdown violate the CAA – Startup/ shutdown: planned events
– No Affirmative Defense Available – No Enforcement Discretion Permitted – Subject to Both Monetary Penalties and Injunctive Relief
48
(for S/ S events)
– CAA allows “special emission limitations or other control measures or control techniques that are designed to minimize excess emissions” during startup/ shutdown periods – 7 specific criteria for states to consider in creating special SIP provisions for S/ S:
1. Should be limited to specific, narrowly defined source categories using specific control strategies;
49
2. Use of a control strategy must be technically infeasible during startup or shutdown periods; 3. Frequency and duration of operation in startup or shutdown mode must be minimized; 4. Should analyze the worse-case emissions that could occur during startup or shutdown; 5. All possible steps to minimize impact of emissions during startup and shutdown must be taken;
50
6. At all times, the facility must be operated in a manner consistent with good practice for minimizing emissions, and source must have used best efforts regarding planning, design, and operating procedures to meet
7. Actions taken during startup and shutdown periods must be documented by properly signed, contemporaneous
51
– Malfunction: unplanned event – Affirmative Defense Remains Available
special affirmative defense in SIP for malfunction events:
breakdown of technology, beyond control of owner or
that could have been foreseen and avoided, or planned for, and (b) could not have been avoided by better operation and maintenance practices;
52
emissions;
exceeded;
maximum extent practicable;
emissions on ambient air quality;
possible;
53
documented by properly signed, other relevant evidence;
inadequate design, operation, or maintenance; and
regulatory authority
54
monetary penalties
– Injunctive relief still available
modify operations
55
– 36 States must revise SIPs consistent with proposed rule
Michigan, Minnesota, Ohio
Island, New Jersey, Delaware, Virginia, West Virginia, Alabama, Florida, Georgia, Kentucky, Mississippi, North Carolina, South Carolina, Tennessee, Arkansas, Louisiana, New Mexico, Oklahoma, Iowa, Kansas, Missouri, Colorado, Montana, North Dakota, South Dakota, Wyoming, Arizona, Alaska, Washington and the District of Columbia
published Federal Register
56
– By agreement with Sierra Club – Second (and last) extension
57
– Industries’ criticism:
issues associated with different emissions characteristics during SSM event
– Environmentalists’ criticism:
– Harms citizens’ suits. Affirmative defense makes it more difficult, if not impossible, for citizen suits under the clean air act to proceed. – No penalty jurisdiction. Jurisdiction over assessing CAA penalties lies with the courts not EPA.
58
– Suit brought by electricity generator challenging EPA’s partial disapproval of a Texas rule that allowed an “affirmative defense” against civil liability for excess air emissions caused by SSM events – Holding
regarding SSM treatment in EPA-approved SIP:
– For unplanned SSM events: EPA may allow affirmative defense in SIP. – For planned SS events: EPA may disallow affirmative defense in SIP
59
Oral Argument Oct. 24, 2013)
– Suit challenges EPA’s inclusion of affirmative defense in maximum achievable control technology air toxics rule for Portland cement plants
– Oral Argument Panel: Raised doubts over legality of affirmative defense
Judge Harry
violations to the courts and “this authority wasn’t given to EPA” – Judge Sri Srinivasan
60
– NSPS: “emissions in excess of the applicable level of the applicable emissions limit during periods of startup, shutdown and malfunction [ shall not] be considered a violation of the applicable emission limit unless
C.F.R. §60.8(c).
61
– Against sources that have relied on previously available affirmative defenses (SIP-based or permit-based) – Increased enforcement could require installation of (additional) pollution controls
– SIPs, state regulations, and permit conditions intertwined
including the state’s SSM rules; any revisions to the SIPs may trigger need to also change state/ local permits or regulations
62
– Permit and emission limit review:
during routine startups or shutdowns?
regulations that would be needed to maintain compliance (e.g., longer averaging times or different emission limits during startups).
– Work with state on SIP revisions. – Be persistent with state about fixing/ revising permit terms to reduce exposure.
63
BEIJING BOSTON BRUSSELS CHICAGO DALLAS FRANKFURT GENEVA HONG KONG HOUSTON LONDON LOS ANGELES NEW YORK PALO ALTO SAN FRANCISCO SHANGHAI SINGAPORE SYDNEY TOKYO WASHINGTON, D.C.
April 3, 2014
– if you think you have CERCLA contribution rights, think again
2013) – Chevron deference alive and well; US EPA trumps state agency
– that COE permit and a nickel will get you …
65
– Plaintiff cannot pursue cost recovery claim when contribution claim is available – Statutes of limitations run separately for separate AOCs/ Decrees
66
– Novel interpretation of “resolution of liability” may discourage settlement – Plaintiffs have cost recovery claim if contribution claim has not yet matured – Suggestion that “liability” must be determined
67
– Contribution protection – Effect on cost recovery claim when contribution claim matures – Can you draft around Bankert? Will EPA cooperate?
68
– Reasoned basis for determination – Not arbitrary or capricious – Consistent interpretation over time
69
– Holding: USEPA has post-permit withdrawal authority to withdraw the specification of streams for the disposal of mountaintop mining wastes years after the Corps of Engineers has issued a permit based on the initial specification – Rationale: Based on Chevron analysis
70
Robert A. Kaplan Regional Counsel g U.S. EPA Region 5 April 3, 2014
1
2
3
4
8
April 18, 2013 Chicago Locks & Navy Pier April 18, 2013 Chicago Locks & Navy Pier Photo: Lloyd
Photo: Lloyd Degrane Degrane/Alliance for the Great Lakes /Alliance for the Great Lakes
9
Photo: Lloyd Degrane Degrane/Alliance for the Great Lakes /Alliance for the Great Lakes
12
13
14
15
GHG Endangerment Finding First GHG Standards for Passenger Clean Air Act Process for Stationary S Finding Passenger Vehicles Sources
17
LIGHT-DUTY VEHICLE FUEL ECONOMY STANDARDS, 1978-2025
18
19
E b id K l S ill L t il Enbridge Kalamazoo Spill: Largest oil spill into inland waters July 26, 2010