EPA Proposes to Disapprove Major Aspects of Texas Rules for the Implementing the Federal Clean Air Act in Texas

 In September 2009, the U.S. Environmental Protection Agency (EPA) proposed to disapprove several major aspects of Texas Rules for implementing the federal Clean Air Act (CAA) in the State. The rules in question have been before the EPA for several years, albeit under a different President and political party, without action to approve or disprove them.  A group of companies recently settled a federal court action to require EPA to take action on the rules adopted by Texas.  The EPA action in part has evolved out of this settlement.  The challenge is that companies that have obtained permits and operated under the rules adopted by the Texas Commission on Environmental Quality (TCEQ) face questions of  additional cost of compliance and enforcement under the CAA if EPA disapproves the rules.

 

EPA expressed several concerns in its notice. Specifically, EPA seeks to disapprove among other things the flexible permit program by which companies can make changes within their facility and not amend their permit, and the Texas rules on New Source Review for modifications of facilities under the federally-delegated program.  A major EPA concern is that the TCEQ rules allow modifications that do not require a permit amendment, as would be required under the CAA.  The question is what triggers what is called New Source Review (NSR), which imposes much more stringent requirements on a source of air emissions after changes are made at a facility, including review of the Best Available Control Technology to identify which technology is necessary to control the emissions.  EPA contends that the Texas rules and definitions would not require the same level of control of emissions as those issued by EPA.  In addition, EPA has raised concerns previously regarding the public notice requirements under the TCEQ rules for air permit applications as not following the EPA process under the federal program.

 

In October and November the agencies met and exchanged communications regarding working to work through their differences. The TCEQ pointed out that the rules had brought grandfathered and unpermitted facilities under the Texas air permitting program, and cut emissions. EPA asked the TCEQ to issue a letter to regulated facilities regarding the EPA notices and the potential implications.  The TCEQ has used emails and placed information on its website to communicate the status of EPA actions and to advise regulated entities that any action taken on pending applications affected by the EPA notices may result in additional permitting or enforcement because of the uncertainty of future EPA action on the proposed disapproval notices.

 

Although disagreeing with EPA’s positions, the TCEQ announced a rulemaking schedule to address EPA concerns starting in December 2009 through at least August 2010.  The outcome of the EPA-TCEQ negotiations and the final revisions to the state air emission regulations may have significant impacts on regulated facilities in Texas, particularly if additional controls are required to reduce emissions at these facilities, and if any enforcement action is taken by EPA or citizens groups against them under the federal act.