On Feb. 7, the U.S. Environmental Protection Agency published an update to the National Ambient Air Quality Standards (NAAQS) for fine particulate matter, commonly referred to as PM 2.5. The EPA announced that the annual standard for PM 2.5 will be lowered to 9 ug/m3, a significant decrease from the current standard of 12 ug/m3. Other provisions of the PM NAAQS, including the standard for PM 10, are unchanged. See National Ambient Air Quality Standards (NAAQS) for PM | US EPA.
The rule becomes effective 60 days after publication in the Federal Register. The new rule will have some immediate impacts on permit applications for new major sources or major modifications and will impose some longer-term obligations on the states and major sources.
What does this mean for state government and businesses?
States will now begin a likely multi-year process to review air quality in their counties and regions and petition the EPA to designate the counties as being in attainment or various categories of non-attainment. For the first time in the modern era, Pennsylvania and Ohio have been measuring attainment for the PM 2.5 standard across the state. However, based on current data, the EPA estimates that seven countries in Pennsylvania and four in Ohio could fall back into nonattainment status. The final designations will be based on updated air quality monitoring data that may change those estimates. Even once a county or region’s air quality monitors show air quality has improved, it will take multiple years of data, assessed for quality, for a state to successfully petition the EPA to place the county or region back into attainment.
With the change in the PM 2.5 standard, states also will be required to submit SIP (State Implementation Plan) revisions, first to demonstrate they have the legal authority necessary to enforce the new standard and then to show how an area designated as nonattainment will be brought into attainment. New state regulations can be anticipated to follow
The new rule will have immediate effect on the permitting of new major sources of NAAQ pollutants or major modification at such facilities, even in attainment areas. In attainment areas, the new PM 2.5 standard will have to be considered as part of the permit review procedures under the existing PSD (Prevention of Significant Deterioration) regulations. State and local air quality agencies will require sources of particulate matter in attainment counties to undergo modeling to ensure the operation of the new or expanded facility will not push the county or region into non-attainment and to install BACT (Best Available Control Technology) controls. The EPA has determined that this requirement will apply to any applications submitted after the effective date of the rule and to any applications that are not finally approved by that date.
A non-attainment designation, of course, will implicate much stronger permitting requirements for facilities that emit particulate matter, as compared to facilities in regions or counties measuring attainment. Major sources or major modifications at those facilities will have to install and operate pollution control technology to achieve the “Lowest Achievable Emissions Rate,” or the most stringent (and likely expensive) technology in the country, as well as procure and surrender sufficient Emission Reduction Credits to keep the region or county on track to get back to attainment. Such credits must be obtained from another source within the same county or region that has reduced emissions beyond its permitting requirements. Such circumstances are rare, given existing permitting requirements and available technology. Industrial sources have anecdotally reported a current shortage of ERCs, a situation that is only expected to be exacerbated.
In addition, a non-attainment designation will impact the evaluation of various infrastructure projects. States and local governments proposing to expand highway infrastructure may also have to undergo a more protracted environmental review process. Likewise, private land development projects with potential PM emissions, such as warehouses and housing projects, will be subject to more rigorous analysis to assess their impact on nonattainment. All of this is to say that this change is likely to impose significant costs on not just industry, but air quality agencies as well.
What should business do next?
Any business considering near-term construction of a new major source or significant expansion of an existing major source should carefully consider the impact the new standard will have on a new or pending permit application for such a project.
While it is likely to be several years until the PA DEP and EPA finalize which parts of Pennsylvania are in non-attainment for the new standard, thus bringing the more stringent permitting requirements into effect, industrial facilities in Pennsylvania should consult with counsel now to plan on a compliance strategy, including an assessment of the facility’s ability to install more stringent controls and to produce or procure emission reduction credits.
Facilities should also diligently monitor regulatory proceedings by air quality agencies as they begin assessing and petitioning EPA to define non-attainment areas.
