The U.S. Environmental Protection Agency (“EPA”) has announced its newest target for Clean Air Act enforcement: metal recycling facilities. In an enforcement alert issued in July 2021, EPA states that it has identified emission violations at metal recycling facilities that operate auto and scrap metal shredders. Specifically, EPA wants shredder owners and operators to be aware that the amount of volatile organic compounds (“VOCs”) emitted by their facilities may exceed thresholds for New Source Review (“NSR”) permitting or, depending on the location of the facility, installation of Reasonably Available Control Technology (“RACT”). Failure to comply with any of these requirements is a violation of the Clean Air Act, which could lead to an enforcement action ultimately requiring payment of substantial penalties and installation of emission controls.
Metal recycling facilities with shredders process scrap materials including automobiles and large appliances. Materials are run through a shredder that breaks them into a size suitable for further processing. Recovered scrap metals are sold to end users, such as manufacturers and foundries.
VOC emissions from shredding facilities are regulated under the Clean Air Act because, among other reasons, they can contribute to violations of the National Ambient Air Quality Standards (“NAAQS”) for ozone. Uncontrolled VOC emission rates vary with the size of the shredder and the scrap materials processed. EPA reports that typical shredding operations emit VOCs at rates between 20 and 200 pounds of VOCs per hour. Shredders with enclosures and controls such as a scrubber or cyclone generally have lower emissions. Additionally, emission rates are typically lower when the facility “depollutes” scrap materials by removing contaminants before shredding.
EPA’s alert highlights three recent Clean Air Act settlements entered into by scrap metal shredding owners and operators. Penalties ranged from $900,000 to $4.1 million. All three settlements required installation of emission control trains, which generally include particulate control devices (e.g., a cyclone, venturi scrubber, or fabric filters), regenerative thermal oxidizers for VOCs, and a scrubber to control acid gases (e.g., hydrogen fluoride and hydrogen chloride).
To help minimize VOC emissions and achieve compliance, EPA recommends that owners and operators of scrap metal shredders take steps to:
- Depollute: Depolluting scrap materials before they enter the shredder not only reduces VOC emissions but also helps prevent fires and explosions in the shredder. The types of materials that should be depolluted include: liquids such as gasoline, oil, antifreeze, and brake fluid; batteries; air bags; switches and light ballasts containing mercury; and refrigerants.
- Accurately estimate VOC emissions. Sources should use appropriate test data from similar facilities when estimating VOC emissions. EPA recommends that if estimated VOC emissions are below but near regulatory thresholds, sources should consider conducting a performance test to measure actual VOC emissions and to develop a facility-specific emission factor.
- Reach out to local air permitting officials: If estimated emissions are over the RACT or NSR thresholds, sources should contact their local permitting agency to discuss a path forward.
EPA’s targeting of shredding facilities is ostensibly consistent with the Biden administration’s focus on environmental justice and EPA’s current National Compliance Initiatives (“NCIs”). According to EPA’s alert, the more than 250 shredding facilities in the United States “are often located in densely populated areas,” such that “noncompliant shredders can have an impact on overburdened communities.” The alert is also consistent with the NCI for “Creating Cleaner Air for Communities by Reducing Excess Emissions of Harmful Pollutants from Stationary Sources,” which focuses on reducing emissions of both VOCs and hazardous air pollutants that threaten vulnerable populations or attainment of the NAAQS.
EPA’s alert is the latest in a line of enforcement alerts issued against sources that have included aftermarket defeat devices, natural gas gathering operations, and storage vessels at oil and natural gas production facilities. EPA uses these alerts to signal that it intends to become active in a particular sector and to put that sector on notice that it is developing the enforcement expertise necessary to pursue cases. Accordingly, shredding facilities should take steps now to confirm that their emission levels do not exceed regulatory thresholds. Shredding facilities should also evaluate whether they wish to take advantage of EPA’s Audit Policy, which can offer substantial penalty reduction benefits for self-disclosed violations.