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February 3, 2011 |
USEPA "Changes Course" to Exempt Stalled Permits From New NAAQs and GHG StandardsA fundamental aspect of environmental compliance is the process of obtaining and renewing permits. This process becomes more difficult when regulations governing the permit are amended while the permit application is awaiting decision. USEPA has shed light on this issue in a recent Determination from the Assistant Administrator of the Office of Air and Radiation ("OAR"). Assistant Administrator McCarthy announced on January 31, 2011 that USEPA intends to exempt the Avenal Power Center in California from the new standards set for emissions of nitrogen dioxide ("NO2"), greenhouse gases ("GHGs"), and sulfur dioxide ("SO2") (the "Determination") because the standards became effective during the time period when the Avenal Power Center's permit application was awaiting decision. The Determination represents a substantial change in direction from USEPA's previous statements on this issue. The change comes about as part of litigation between USEPA and Avenal Power LLC ("Avenal"). Avenal submitted an application for a prevention of significant deterioration ("PSD") permit in 2008. While Avenal's PSD permit application was pending, new standards for NO2 became effective in February 2010. After the new NO2 standards became effective, USEPA stated that it would require Avenal to abide by the new standards, even though Avenal's permit application had been filed in 2008. In March 2010, Avenal sued USEPA in federal court, alleging that USEPA's position violated its obligation under the Clean Air Act ("CAA") to grant or deny a PSD permit within twelve months of receiving the completed permit application. Had USEPA issued a permit within that time period, the NO2 standards would not have applied. As the result of a policy review, USEPA has now determined that "it is appropriate, under certain narrow circumstances, to grandfather certain PSD applications" from the NO2 standard as well as other permitting requirements (including certain GHG and SO2 requirements) that have taken effect during the pendency of the applications. USEPA emphasized that its statutory obligation to grant or deny a permit application within twelve months was of central importance to the Determination. The Determination has broader application than just for the Avenal Power Center. The Determination announced that USEPA intends to "extend similar relief to other permit applicants that can show they are similarly situated." Because the Determination represents a change in USEPA policy, USEPA indicated it will issue a supplemental public notice to further explain its decision, which will be subject to a comments and a public hearing. RECENT ENVIRONMENTAL PUBLICATIONS"USEPA Releases Review of the Draft 2002 Subsurface Vapor Intrusion Guidance," Environmental Update (February 1, 2011)"USEPA Issues New Greenhouse Gas BACT Guidance," Environmental Update (November 16, 2010) "Kermit Was Right: It Isn't Easy Being Green — and Claiming That Status Will Require Greater Care," Environmental Update (October 7, 2010) "USEPA Proposes Transport Rule to Replace CAIR," Environmental Update (July 7, 2010) ABOUT SCHIFF HARDIN LLPSchiff Hardin's diverse environmental practice advises clients engaged in a wide variety of industries and commercial endeavors such as electric generation, natural gas distribution and production, chemical manufacturing, auto and auto parts manufacturing, consumer goods manufacturing, real estate development and investments by financial institutions and equity investors. |