EPA Adopts “Back to Basics” Process for NAAQS Review

On May 9, EPA Administrator Pruitt released a memorandum to Assistant Administrators titled “Back to Basics Process for Reviewing National Ambient Air Quality Standards” (NAAQS). Key provisions include:

1. Meeting statutory deadlines. The Administrator has ordered completion of the pending review of the ozone NAAQS by October 2020 and of the pending PM NAAQS review by December 2020. The memorandum directs the agency to ensure that the Clean Air Scientific Advisory Committee (CASAC) will convene panels with the necessary expertise in a manner consistent with the 2017 directive on federal advisory committees. This is part of a larger effort to ensure that EPA completes its NAAQS reviews within the statutory 5-year period, a requirement that the agency seldom has met, often spawning litigation in the past.

2. Addressing all CAA NAAQS review provisions. This provision focuses on implementation of the Clean Air Act’s (CAA) requirements for CASAC advice in two areas that have historically been given short shrift: (1) adverse public health, welfare, social, economic, or energy effects which may result from various strategies for attainment and maintenance of a standard (presumably including the adverse health effects of unemployment resulting from a standard); and (2) consideration of background pollution, attainability and technological feasibility. Questions on these issues will now be presented explicitly to CASAC in its official charge documents. The memorandum notes that the Supreme Court has held that EPA cannot consider implementation costs in establishing NAAQS, but states that the Court also recognized that CASAC’s “advice concerning certain aspects of ‘adverse public health … effects’ from various attainment strategies is unquestionably pertinent” to the NAAQS rulemaking record and relevant to the standard-setting process. The Memorandum indicates that EPA will consider implementation costs in the policy judgment it makes with respect to the standard’s margin of safety, and also in developing implementation rules. It also directs CASAC to provide advice on certain agency actions where the Committee historically has been silent, including review of the Regulatory Impact Analysis for a proposed standard and any resulting implementation rules.

3. Streamlining and standardizing the process. This section requires a number of changes to the NAAQS review process to speed it up and make the various documents involved more useful.

4. Clearly differentiating between science and policy considerations. This provision requires the agency to establish a clear distinction between the purely scientific findings of a NAAQS Integrated Science Assessment (ISA) and the wider range of policy concerns that the Administrator must consider in making judgments about requisite standards and margins of safety. It also directs EPA to request CASAC to distinguish clearly between its scientific and policy advice.

5. Issuing timely implementation of regulations and guidance. When a NAAQS is revised, EPA is directed to issue concurrent implementation regulations and guidance as necessary, and also to issue technical information to assist states in developing approvable plans and demonstrating how any new NAAQS is to be attained and maintained. The rules and guidance should provide information relevant to the submission and consideration of state implementation plans and preconstruction permit applications, and may address potential tools for regulatory relief to address background concentrations and sources of pollution outside of the control of the state.

These new principles will be applied to the pending reviews of the ozone and PM NAAQS, which are to be completed before the 2020 elections, and likely will spawn litigation over both of EPA’s final decisions in reviewing these standards.

EPA Science Advisors Support Current SO2 NAAQS

EPA’s Clean Air Scientific Advisory Committee (CASAC) has now completed its review of the agency’s draft Policy Assessment (PA) for the SO2 NAAQS, and supports the EPA staff recommendation that the current scientific literature does not support revision of the current primary (health based) SO2 NAAQS.

In a draft letter recently released, CASAC notes that “key uncertainties” have emerged since the prior SO2 review, particularly with regard to “at-risk” subgroups such as children who are: obese; of African-American ethnicity; severely asthmatic; and/or live in high density areas near sources of exposure. The Committee believes that while many uncertainties remain in quantifying the sizes of the risks for these groups, they should nonetheless be considered in ensuring that the standard provides an adequate margin of safety. CASAC also recommends that efforts should be made to gather the data necessary to ensure that protection of these groups can be considered with less uncertainty in future reviews of the standard.

According to the draft letter, the Committee believes it possible that the current 75 ppb level may not provide an adequate margin of safety in these groups. However, because there is considerable uncertainty in quantifying the sizes of these higher risk subpopulations and the effect of SO2 on them, the Committee did not recommend reconsideration of the level at this time. CASAC strongly recommends that future assessments better quantify the numbers of individuals expected to be affected at the current (or proposed alternative) standard in these groups so that a more informed judgment about the margin of safety in high risk subgroups can be made. In particular, the Committee suggests that EPA express the size of the at-risk population both in percentage form (which is currently done) and also with numerical estimates, providing the number of people expected to be at risk, given the margin of safety.

The Committee recommended a few changes in the draft PA and stated that with those changes it need not review another draft. We expect that CASAC will finalize its draft letter soon and that EPA will then move to finalize the PA and propose to retain the current standard. We doubt that the current Administration will seize on the “margin of safety” points in the CASAC letter to propose a revised standard (as some prior administrations might have done). However, those issues are likely to be a primary focus of the next review of the SO2 standard.

Apart from SO2, this letter is significant because it is the first official CASAC action under the newly appointed Chair, Anthony Cox, and the other new members appointed by this Administration. It therefore appears that the reported “backlog” of NAAQS reviews caused by CASAC appointment delays will now begin to break.

New NSR Guidance Considers Emissions Decreases

EPA recently issued new Guidance for determining whether a proposed new or modified source of air pollutants would cause a significant increase in emissions, requiring a major source permit. See Memorandum from Administrator Pruitt to Regional Administrators re: Project Emissions Accounting Under the New Source Review Preconstruction Permitting Program (March 13,2018).

To date, EPA has employed a two-step process for evaluating projected emissions for major source status. Under step 1, the agency determines whether the project by itself – including emission controls – would cause a significant increase in emissions. Under step 2, the agency then looks at other “contemporaneous” projects at the facility – defined as those constructed within the past two years – to determine whether all of the projects combined would result in a “significant net increase” in emissions from the entire facility. If so the facility will require a major source permit.

With a few brief exceptions, the agency throughout its history has not allowed consideration of emissions decreases in step 1. The emissions baseline for the new project is set at zero, and offsets for emissions decreases are not considered until step 2. The practical effect has been to require all major sources to model both steps, even though the modeling in step 1 might show a decrease at that point, precluding the need to move to step 2 (e.g., the project includes new emission controls and also involves shutting down other emissions sources within the plant to produce an emissions decrease).

The new Guidance, effective immediately, revises EPA’s approach to allow consideration of net emissions decreases in step 1. The agency now believes that the prior approach had the practical effect of preventing some projects from proceeding and significantly delaying others, even though those projects would not have resulted in a significant emissions increase. The agency also recognizes that the increased efficiency of new production technologies can result in emission reductions even while expanding production. In such situations, the complexities associated with modeling multi-year contemporaneous netting under Step 2 at a large facility have dissuaded some meritorious projects. The new interpretation is designed to correct this, and the agency believes it is consistent with the relevant language of the Clean Air Act and current NSR regulations.

2008 Ozone Plan Rebuffed by DC Circuit

In a wide-ranging opinion issued February 16, the D.C. Circuit invalidated major aspects of EPA’s Implementation Rule for the 2008 national ambient air quality standard (NAAQS) for ozone. (South Coast Air Quality Management District v. EPA, No. 15-1115). Primary holdings are as follows:

  • States cannot take credit for NOx or VOC emission reductions outside of a nonattainment area for purposes of meeting the 15% reduction “rate of progress” requirement or the 3% “reasonable further progress” requirement.
  • In nonattainment areas, EPA cannot revoke a prior NAAQS without putting in place the “anti-backsliding” rules required by Section 172 (e) of the Act, which requires maintenance of controls “not less stringent than” the pre-existing nonattainment plan requirements. This applies to all measures in the plan that are “designed to constrain” ozone pollution.
  • The anti-backsliding requirements apply fully to so-called “orphan” nonattainment areas, which are meeting the 2008 NAAQS but were never reclassified to attainment under the 1997 standard, unless the area has been redesignated as attainment for the 2008 standard.
  • The anti-backsliding requirements also apply to so-called “orphan maintenance areas” – areas that had been nonattainment for the prior standard but were redesignated to maintenance areas.
  • EPA’s selection of 2011 as the baseline year for tracking reasonable further progress in attaining the 2008 ozone standard was reasonable, given EPA’s rationale that 2011 was the first year in which three years of monitoring data would be available.
  • Nonattainment areas that had achieved the 15% rate of progress reduction under the 1997 standard need not do so again under the current standard.
  • Compliance with the “reasonably available control technology” (RACT) requirement may be demonstrated on an area-wide basis, without requiring each individual source to employ RACT.

In 2017, the Obama Administration issued a proposed Implementation Rule for the ozone standards adopted in 2013, but the proposal has not been finalized. EPA reportedly had been planning to issue a new proposal, but recently announced that a final rule would be issued based on the Obama proposal. The agency now will need to take this opinion in account in crafting its final rule for the 2013 standard.

EPA Rescinds MACT “Once In Always In” Policy

In late January, EPA issued a guidance memorandum rescinding the agency’s prior policy that once a source becomes a major source subject to a maximum achievable control technology (MACT) standard under section 112 of the Clean Air Act (CAA), it cannot be reclassified later as an area source not subject to MACT. The prior policy, known as the “once in always in” policy, dates from guidance issued in 1995. Under the new policy, a major source can become an area source if it takes an enforceable limit on its potential to emit (PTE) hazardous air pollutants (HAP) below the major source thresholds (i.e., 10 tons per year (tpy) of any single HAP or 25 tpy of any combination of HAP). A source that was previously classified as major, but which so limits its PTE, will no longer be subject either to the major source MACT or other major source requirements that were applicable to it as a major source under CAA section 112.

The legal basis for this action is that the “once in always in” policy contradicts the plain language of the definitions of “major source” in CAA section 112(a)(l) and “area source” in CAA section 112(a)(2). EPA has twice proposed to rescind the policy since it was adopted in 1995, but neither proposal was finalized. The new guidance rescinding the prior policy is effective immediately. EPA also will take comment on a rulemaking proposal to codify the new policy, to be published at a later date. Several opposition groups have announced their intention to file lawsuits seeking to overturn the new policy.

EPA Enforces RICE Rule at Sand and Gravel Operation

A Massachusetts sand and gravel company, Kimball Sand, has agreed in a settlement with EPA to conduct opacity testing at one of its operations and to replace three stationary engines with newer, cleaner engines. The company also paid a penalty of $120,000 for violations of the applicable new source performance standard (opacity) and the air toxics rules for stationary reciprocating internal combustion engines (RICE).

Kimball Sand operates rock crushing equipment including stone crushers, screeners, conveyer belts, as well as its engines at their facility. The equipment is subject to federal Clean Air Act (CAA)’s New Source Performance Standards for Nonmetallic Mineral Processing Plants, and the engines are subject to the CAA National Emission Standards for Hazardous Air Pollutants for Stationary Reciprocating Internal Combustion Engines.

Industry sources believe this may be the first RICE enforcement settlement at a sand and gravel operation.

EPA Defends “Exceptional Events” Rule

In pleadings recently filed with the Federal Court of Appeals for the D.C. Circuit, EPA has defended the “Exceptional Events” rule issued by the Obama Administration last October. The rule is designed to excuse exceedances of national ambient air quality standards (NAAQS) where they are caused by natural events such as wildfires or dust storms. It is particularly important in western states where such events occur frequently.

EPA revised the rule in response to state and industry complaints that the prior rule was overly cumbersome and unevenly applied. Various environmental groups challenged the new rule in the D.C. Circuit, arguing that it excuses some events that are caused at least in part by human activity, such as windblown dust from construction or mining activities. EPA counters that Congress did not define “natural event” in the relevant statute, and that the agency opted for a middle ground that covers events in which human activity plays little or no direct causal role. The agency also notes that the rule only allows the exclusion where” reasonable emission controls” have been adopted.

The exceptional events rule is likely to play a critical role in evaluating NAAQS exceedances caused by the recent hurricanes and western wildfires. Under EPA’s current interpretation, it cannot excuse violations of permit or SIP provisions, but it can be used to ensure that future SIP or permit provisions are not based on extreme conditions. Historically, the primary tool for excusing SIP or permit violations caused by natural disasters has been provisions that excuse violations caused by startup, shutdown or malfunction (SSM) conditions. But those protections have been eroded as a result of recent court decisions and related Obama Administration policies that the Trump Administration is now trying to revise. Much of the regulatory response to the recent disasters in the air quality arena will be shaped by the fate of the exceptional events and SSM rules, which will in turn be shaped by the occurrence of the disasters and the likelihood that we will continue to experience them.

EPA Proposes to Retain Primary NOx NAAQS

Clean Air Act Section 109(d) requires EPA to review national ambient air quality standards (NAAQS) at least every 5 years, and revise them if newly available information indicates that the existing standards are not adequate to protect public health and welfare. The last EPA review of the primary (health based) NAAQS for nitrogen oxides (NOx) was completed in 2010. In that review, the agency added a new one-hour standard at a level of 100 ppb, while retaining the prior annual standard of 53 ppb, set in 1971.

EPA is now nearing the end of the next review of the primary NOx standards, and recently released a proposal not to revise the standards adopted in 2010. (The NOx secondary standards are being reviewed separately.) With respect to the one-hour standard, the proposal finds that the strongest evidence continues to come from human exposure studies of respiratory effects in asthmatics following short-term exposures (typically minutes to hours). Most of these studies were available in the last review, and an updated meta-analysis continues to show effects in some asthmatics following resting exposures to NOx concentrations from 100 to 530 ppb. However, the current data remain insufficient to calculate a reliable dose-response relationship between exposure and effects, and there is uncertainty regarding the potential adversity of reported responses, particularly at the lower exposure levels. While supporting evidence from epidemiological studies reduces uncertainty from the last review, the newly available studies do not fundamentally alter EPA’s prior understanding.

The annual standard is based on a reported relationship between long-term NOx exposures and asthma development in children. The strongest evidence supporting this conclusion comes from recent epidemiologic studies. While these studies strengthen the evidence for effects from long-term exposures presented in the 2010 review, they are subject to uncertainties resulting from the methods used to calculate exposures, the high correlations between NOx and other traffic-related pollutants, and the lack of information regarding the extent to which reported effects are independently associated with NOx rather than the overall mixture of traffic-related pollutants. Additionally, while  the current evidence reports adverse effects (emergency department visits, hospital admissions, asthma incidence) in locations likely to have violated the current standards, studies do not indicate such associations in locations that would clearly have met those standards.

EPA also considered quantitative analyses estimating the potential for adverse NOx exposures that could be allowed by the current standards. Overall, these analyses indicate that the current standards provide substantial protection against adverse effects even under worst-case conditions across a variety of study areas in the U.S.

On the basis of these findings, EPA proposes to retain the current standards. The proposal is consistent with the advice of EPA staff in the NOx Policy Assessment and with the advice of the agency’s Clean Air Scientific Advisory Committee. Comments on the proposal will be due 60 days after it is published in the Federal Register.

Beyond this NOx review, a couple of these findings may affect the pending reviews of the PM and other NAAQS. These include recognition of the uncertainties in the studies at lower exposure levels, and the inability to separate NOx effects from the rest of the traffic pollution mixture.

EPA Seeking Nominations for the Clean Air Scientific Advisory Committee

The Clean Air Scientific Advisory Committee (CASAC) is a chartered Federal Advisory Committee, and was established pursuant to the Clean Air Act (CAA) to provide advice, information, and recommendations to the EPA Administrator on the scientific and technical aspects of air quality criteria and National Ambient Air Quality Standards. Members of the CASAC include non-EPA scientists, engineers, and physicians who are nationally and internationally recognized experts in their respective fields. Members are appointed by the EPA Administrator for a three-year term and serve as Special Government Employees who provide independent expert advice to the agency.

EPA is seeking nominations for the “health chair” of the CASAC. The CAA requires that at least one member be a physician who is a member of the National Academy of Sciences and has expertise in health effects of air pollution. EPA is interested in physicians who have knowledge and experience in air quality relating to criteria pollutants (ozone, particulate matter, carbon monoxide, nitrogen oxides, sulfur oxides, and lead). Nominations are due by July 27.

You can read the Federal Register notice here.