In a FR notice, the EPA has indicated its intention to begin rulemaking that may impose financial assurance requirements to ensure that sufficient funds are available to clean up hazardous waste generated by three industrial sectors: (1) chemical manufacturing; (2) petroleum and coal products manufacturing; and (3) electric power generation, transmission, and distribution.
|
As required by a court agreement, the rulemaking will proceed on three different tracks, with one proposal due by July 2, 2019, the second by December 4, 2019, and the third by December 1, 2022. The agreement does not require that a proposal for a specific sector be issued by any of the three dates, and in its notice, the EPA has not indicated the order in which proposals for the sectors will be issued.
Neither does the agreement require that actual financial assurance requirements be imposed on the sector. The EPA may decide that such requirements are not needed, but that decision must be the product of formal rulemaking.
2008 lawsuit
The notice is the latest development following a lawsuit filed in 2008 by environmental groups. According to the suit, the EPA had failed to meet its obligation under Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) Section 108(b) to develop regulations that require classes of facilities to establish and maintain financial responsibility consistent with the degree and duration of risk associated with the production, transportation, treatment, storage, or disposal of hazardous substances. The Agency responded to the suit with two advance notices of proposed rulemaking (ANPRMs); one in 2009 indicated the intention to initiate financial assurance rulemaking for hard-rock mining; the second in 2010 indicated the same for the three other industries addressed in the current notice.
When the Agency failed to follow up with actual proposals, environmental groups returned to court, whereupon the Agency was ordered to issue a proposed financial assurance rule for the hard-rock mining industry by December 1, 2016, and publish a final rule 1 year later, and also announce, by the same date, whether or not it would issue proposals for the three additional sectors. The final financial assurance proposal for hard-rock mining was published in the January 11, 2017, FR, along with the notice that rulemaking for the three other sectors is also being initiated.
Wastes generated
In the notice, the EPA indicates that the three sectors are good candidates for CERCLA Section 108(b) financial assurance requirements. According to the Agency, the chemical manufacturing and the petroleum and coal products manufacturing industries were the top two industries in a ranking of the quantity of hazardous waste generated in 2007 and were responsible for approximately 64 percent of all the hazardous waste reported in the 2007 Resource Conservation and Recovery Act (RCRA) Biennial Report (BR) cycle.
The electric power generation, transmission, and distribution sector was responsible for approximately 0.05 percent hazardous waste generated. “This is not unexpected considering that coal combustion residuals (CCRs) are a Bevill exempt waste under RCRA, and thus not subject to Biennial Reporting requirements,” says the EPA.
Rationale
In its notice, the Agency briefly fielded several comments industry has submitted in response to the 2010 ANPRM. For example, commenters said the industries are already subject to financial responsibility requirements under RCRA. The EPA responds that the type of risk contemplated under CERCLA Section 108(b) is different than the financial responsibility requirements for closure imposed under RCRA and other statutes.
Industry commenters also argued that the three sectors are financially sound and not subject to bankruptcies. The EPA answered that the need for financial responsibility should not be informed by the financial health of the overall industry.
“Financial responsibility is imposed on classes within an industry, but is assessed at the facility level, and not the industry as a whole,” said the Agency. “Economic solvency at an industry-wide level is not a substitute for insurance against the possibility of CERCLA liabilities remaining unsatisfied on a facility-specific basis.”