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Startup, Shutdown and Malfunction Exemption Wacked by D.C. Court (01/07/09)

On December 19, 2008, the D.C. Circuit Court of Appeals granted environmental Petitioner’s challenge to EPA’s startup, shutdown and malfunction (SSM) provisions and vacated the SSM exemption.  The decision was 2 to 1 with Circuit Judge Rodgers writing for the Court, and Senior Circuit Judge Randolph writing a strong dissenting opinion.  Below we summarize the way the Circuit Judges Rodgers and Tatel apparently viewed this case.  However, Senior Circuit Judge Randolph does not agree that the Court has jurisdiction over the Sierra Club’s petition for judicial review.  Judge Randolph reminded his colleagues that the original SSM regulation was issued by EPA in 1994, and the Sierra Club took no legal action.  Under the CAA, a petition for judicial review of an EPA regulation must be filed within 60 days of the regulation’s publication in the Federal Register.

In the 1970s EPA determined that excess emissions during SSM periods should not be considered violations of the Clean Air Act (CAA) emission standards under section 111 (i.e., new source performance standards).  Although sources are exempt from numerical limits during SSM events, EPA requires owners and operators to maintain and operate any affected facility including air pollution control equipment in a manner consistent with good air pollution control practices for minimizing emissions (i.e., the general duty requirement).  In 1994, EPA adopted the SSM exemption for section 112 rules (i.e., maximum achievable control technology (MACT) standards).  Although sources were exempt from numerical limits, EPA required each source to develop and implement an SSM plan.  Each SSM plan must describe in detail procedures for operating and maintaining the source during SSM periods and a program of corrective action for malfunctioning process and air pollution control equipment.  Each plan was to be incorporated by reference into the source’s Title V permit.

In 2002, EPA removed the requirement that a source’s Title V permit incorporate the SSM plan, and instead determined that a source’s Title V permit must simply require the source to adopt an SSM plan and to comply with it.  Additionally, EPA decided that an SSM plan was to be made publicly available only upon request.  The Sierra Club sought reconsideration of the 2002 rule.  In 2003, EPA decided to require members of the public to make a specific and reasonable request of the permitting authority to request the SSM plan from a source.  Both the Sierra Club and Natural Resources Defense Council (NRDC) challenged the 2003 rule.  In 2006, EPA retracted the requirement that sources implement their SSM plans during SSM periods.  EPA’s reasoning was that since the SSM plan was not part of the Title V permit, the Agency could not require it to be followed.  Nonetheless, EPA stated the general duty to minimize emissions remains intact and is the applicable and enforceable requirement.  Petitioners now argue that the exemption from compliance with emission standards during SSM events is both unlawful and arbitrary, and the 2002, 2003, and 2006 rules unlawfully and arbitrarily fail to assure compliance with applicable requirements under Title V.  According to Judge Rodgers’ opinion, EPA’s SSM exemption violates the CAA’s requirement that some section 112 standard apply continuously.  Accordingly, the Court granted the petitions and vacated the SSM exemption.

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Last Revised: January 28, 2011