EPA's Proposed Rule Regarding Treatment Of Startups, Shutdowns, And Malfunctions Under The Clean Air Act

On February 22, 2013, the U.S. Environmental Protection Agency ("EPA") published a proposed rule entitled Response to Petition for Rulemaking; Findings of Substantial Inadequacy; and SIP Calls to Amend Provisions Applying to Excess Emissions During Periods of Startup, Shutdown, and Malfunction (the "Proposed Rule"). The Proposed Rule is in response to a Petition for Rulemaking filed with the EPA by the Sierra Club on June 30, 2011 (the "Petition"). The Petition includes numerous requests regarding provisions in previously approved State Implementation Plans ("SIPs") concerning the treatment of excess emissions when industrial facilities are starting up, shutting down, and malfunctioning.

In the Proposed Rule, EPA proposes to find that 36 states have SIPs that contain provisions regarding emissions during periods of startup, shutdown, or malfunction ("SSM") that are inconsistent with the Clean Air Act ("CAA").1 As detailed below, EPA takes the position that affirmative defenses for emissions during periods of startup and shutdown are impermissible and that only narrowly crafted affirmative defenses from monetary penalties are allowed during periods of malfunction. EPA proposes to use its existing authority to direct affected states to submit, under a so-called "SIP Call," revised SIPs that comport with EPA's interpretation of SSM provisions by as early as February 2015.

If finalized in its current form, the Proposed Rule could have significant impacts on sources that currently rely on legally available defenses during periods of SSM. Although EPA states that it intends the Proposed Rule to apply only to the SIP provisions specifically addressed in the rulemaking, the Proposed Rule signals an overall shift in EPA's position on this issue.

EPA recently again extended the comment period for the Proposed Rule. Comments are now due by May 13, 2013.

Startups and Shutdowns Under the Proposed Rule

In the Proposed Rule, EPA proposes to find that SIPs containing affirmative defenses to enforcement for emissions during planned events, such as startups, shutdowns, maintenance, and load-changes, are "substantially insufficient" to meet the requirements of the CAA. In so doing, EPA takes the position that "[e]xcess emissions during planned and predicted periods should be treated as violations of [] applicable emissions limitations." EPA believes that such events are "phases of normal plant operation" subject to all applicable emissions limitations. EPA, recognizing inconsistencies, proposes to rescind its prior interpretation of the CAA that would allow affirmative defenses during such periods.

Rather than allowing affirmative defenses from emission limits during startups and shutdowns, EPA indicates that the CAA would allow "special emission limitations or...