Regulatory Developments, Special Topics in Environmental Management

Additional Good Neighbor Requirements Unnecessary, Says EPA

Based on “additional information and analysis,” the EPA is proposing to determine that its Cross-State Air Pollution Rule (CSAPR) Update for the 2008 ozone National Ambient Air Quality Standards (NAAQS) (October 26, 2016, Federal Register (FR)) satisfies the Agency’s obligation to issue federal implementation plans (FIPs) for 20 states to address air pollution from those states that significantly contributes to nonattainment in, or with maintenance by, the NAAQS in downwind states in the eastern United States. The Agency is also proposing to determine that there will be no remaining nonattainment or maintenance receptors in the eastern United States in 2023.

The proposed determination appears to support the Update Rule as a complete solution to the ozone transport issue. But this view actually changes the Agency’s position when it issued the Rule. At that time, the EPA stated that did not believe the Rule would be the complete solution to cross-state air pollution with reference to the 2008 ozone NAAQS.

“For most states, the electric generating unit (EGU) NOx [nitrogen oxides] ozone season emission budgets finalized in this action represent a partial remedy to address interstate emission transport for the 2008 ozone NAAQS,” the Agency stated in the 2016 action. [emphasis added] “However, as stated in the proposal, the EPA believes that it is beneficial to implement, without further delay, EGU NOx reductions that are achievable in the near term, particularly before the Moderate area attainment date of 2018.”

Now the Agency states in its proposal that “based on additional information and analysis,” the Update Rule fully addresses the Good Neighbor requirements applicable to the 2008 ozone NAAQS for all remaining CSAPR upwind states.

FIPs Issued

Following promulgation of the 2008 ozone NAAQS, states had until 2011 to submit their state implementation plans (SIPs) to the EPA describing how they would meet their obligations under the Clean Air Act’s (CAA) requirement—called the Good Neighbor provision—related to the interstate transport of ozone. In 2015, the EPA determined that 24 states had failed to make complete SIP submissions. (The Good Neighbor obligations of several of these states were subsequently found by the EPA to have been met.) This finding triggered a 2-year deadline (until August 12, 2017) for the EPA to issue the FIPs to address the Good Neighbor provision for these states. The Update Rule included FIPs for these states. The FIPs require that the EGUs in the upwind states participate in a NOx emissions trading program, which the EPA still recognizes as a proven implementation framework that provides regulated sources with flexibility in choosing compliance strategies.

In the Update Rule, the EPA noted that a final determination of whether the EGU NOx reductions quantified in the Rule represent a full or partial elimination of a state’s good neighbor obligation for the 2008 NAAQS is “subject to an evaluation of the contribution to interstate transport from non-EGUs and further EGU reductions that are achievable after 2017.”

Modeling the Future

The Agency now indicates that it has completed this evaluation using “future-year modeling” to identify how downwind air quality issues are linked to upwind states. Future-year air quality projections consider a variety of factors, including current emissions data, anticipated future control measures, economic market influences, and meteorology.

“Once the 2016 Update Rule is fully implemented, upwind states in this region are not expected to contribute significantly to nonattainment or interfere with maintenance of the 2008 ozone standards in any downwind state,” the EPA now concludes, based on its modeling. “Under today’s proposal, EPA and these 20 states would have no obligation to establish additional requirements for sources to further reduce transported ozone pollution to meet the 2008 ozone NAAQS.”

EPA’s prepublication proposal is here.