EPA Region 6 Signals Policy Shift in Startup, Shutdown and Malfunction Events - Good News for Texas

EPA Region 6 recently proposed to approve Texas’s affirmative defense regulations in its State Implementation Plan (“SIP”) applicable to excess air emissions that occur during certain startup, shutdown or maintenance (SSM) events. EPA Region 6 is proposing to take this action because Texas’s SSM SIP provisions were crafted such that, in EPA Region 6’s opinion, they continue to provide adequate protection and do not interfere with Clean Air Act requirements in Texas.   

Region 6’s proposal, if adopted, would be a shift in EPA’s national policy related to SSM events that would allow SSM affirmative defense provisions in SIPs provided they are adequately protective and do not interfere with applicable Clean Air Act requirements. Such a policy shift also impacts the other states subject to EPA’s 2015 SIP Call that required the elimination of affirmative defenses for SSM events.

With respect to Texas, in 2010, EPA had previously approved Texas’s SSM affirmative defense regulations as set forth in its SIP, and EPA’s approval was upheld by the 5th Circuit Court of Appeals. However, in 2014, the D.C Circuit Court rejected EPA’s SSM affirmative defense provisions in the hazardous air pollution regulations (i.e. NESHAPS). As a result of the D.C Circuit’s decision, EPA decided to expand the impact of the decision to SSM affirmative defense provisions in SIPs. As a result of this decision, EPA determined that the SIPs of several states, including Texas, were inadequate and required these states to submit corrections to their SIPs by November 2016. 

In March 2017, after Texas had submitted its SIP revision to EPA, Texas requested that EPA Region 6 reconsider its position with respect to its 2015 SIP Call. After receiving concurrence from EPA headquarters to propose an action inconsistent with EPA’s national SSM policy, EPA partially granted Texas’s request concluding that it may be inappropriate to impose civil penalties on emissions sources for unavoidable events beyond the control of the owner or operator (i.e., malfunction events). Accordingly, EPA Region 6 has proposed to find that Texas’s SSM affirmative defense provisions applicable to certain excess emissions that occur during malfunction events do not make the Texas SIP inadequate, and to withdraw the SIP Call issued to Texas in 2015. 

Once finalized, Texas would be removed from EPA’s 2015 SIP Call and allow Texas’s SIP to contain affirmative defenses that exempts air emission sources from penalties for certain SSM events set forth in Texas’ air pollution control regulations. However, not all excess emission events are exempt from civil penalties. Owners and operators of air emission sources may choose to take advantage of the Texas Self-Audit/Self-Disclosure programs to ensure that they have all required programs in place and satisfy all the regulatory requirements or they will lose their affirmative defense and be exposed to civil penalties.  

For more information, contact Patrick Larkin (patrick.larkin@clarkhillstrasburger.com), Mark Steger (msteger@clarkhill.com), or another member of the Energy, Environment and Natural Resources Practice Group.