Regulatory Developments

American Petroleum Institute Opposes Expansion of OTR

The EPA recently held a public hearing to receive comments on the Agency’s proposed denial (January 19, 2017, FR) of a petition to add nine states to the Clean Air Act’s (CAA) ozone transport region (OTR). At the hearing, Senior Policy Advisor Ted Steichen of the American Petroleum Institute (API) said that expansion of the OTR is unnecessary because existing federal programs are sufficient to bring the “vast majority” of U.S. counties, including those in downwind states, into attainment with the 2008 ozone standards by 2025.

Additional Controls Required

The petition at issue was filed on December 9, 2013, by Connecticut, Delaware, Maryland, Massachusetts, New Hampshire, New York, Pennsylvania, Rhode Island, and Vermont (see Fact Sheet is here). The petition requested that the EPA add Illinois, Indiana, Kentucky, Michigan, North Carolina, Ohio, Tennessee, Virginia, and West Virginia to the OTR.

States added to the OTR would be required to take additional steps to reduce air pollution that is transported by prevailing winds from those states to downwind states. These steps could include:

  • Implementation of reasonably available control technology (RACT) for stationary emissions sources. Under this requirement, state regulators require sources to meet emissions limits developed by the application of controls that are reasonably available considering current technologies and cost.
  • Broadened application of preconstruction permit application reviews under the New Source Review (NSR) program, which is designed to ensure that new major sources and modifications to major sources do not slow progress toward cleaner air.
  • Inspection and maintenance programs to reduce vehicle emissions by ensuring vehicles are in good repair.

Also, the CAA contains a good neighbor provision, which requires states to examine whether pollution generated in their state contributes to poor air quality in another. If a significant contribution is found, the state must adopt measures to alleviate this contribution and include these measures in its CAA state implementation plan (SIP).

Alternative Paths

In its proposed denial, the EPA said that other CAA provisions (e.g., the Cross-State Air Pollution Rule and the nitrogen oxides (NOx) SIP call) provide a better alternative pathway for states and the EPA to develop a targeted remedy to address interstate ozone transport by focusing on the precursor pollutants and sources most effective at addressing the nature of the downwind air quality problems identified by the petitioning states.

“The states and the EPA have historically and effectively reduced ozone and the interstate transport of ozone pollution using these CAA authorities to implement necessary emissions reductions,” said the Agency. “For purposes of addressing interstate transport of ozone with respect to the 2008 ozone NAAQS [National Ambient Air Quality Standards], the EPA believes that continuing its longstanding and effective utilization of the existing and expected control programs under the CAA’s mandatory good neighbor provision embodied in CAA section 110(a)(2)(D)(i)(I) is a more effective means of addressing regional ozone pollution transport with respect the 2008 ozone NAAQS for the areas within the OTR that must attain the NAAQS.”

Increased Compliance Costs

API’s Steichen said that the requested expansion of the OTR would have a detrimental effect on the O&G sector.

“API members would be impacted as they operate multiple refining and petrochemical manufacturing facilities in this proposed expansion area,” said Steichen. “The additional requirements that would be imposed through the petitioned expansion are not necessary for downwind states’ attainment with the 2008 ozone NAAQS and could only serve to increase compliance costs for states, citizens, and businesses, including API members operating in these states.”

Steichen’s comments are here.

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