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Feb 2013
08
February 08, 2013

Important Changes for Commercial and Industrial Boiler Operators


The U.S. EPA has finalized and now published revisions to its hazardous air emission standards applying to industrial and commercial boilers. The revisions include changes to maximum achievable control technology (MACT) standards, the area source boiler rule, commercial and industrial solid waste incineration (CISWI) rules and non-hazardous secondary materials (NHSM) rules.

On December 21, 2012, the EPA announced that it had finalized its revisions.  The revised Major Source Boiler MACT was published on January 31, 2013, 78 Fed. Reg. 7138, and the Area Source Boiler rule was published a day later at 78 Fed. Reg. 7488.  The revised CISWI and NHSM rules are published at 78 Fed. Reg. 9112 (Feb. 7, 2013).

Given the history of litigation over EPA rulemaking under Section 112 of the Clean Air Act (CAA), there undoubtedly will be renewed litigation challenging various aspects of these rules, but it appears unlikely that any new challenges would result in the EPA completely vacating the rules.

Regulated entities must now consider in earnest their strategy for operating in compliance with these rules. Commercial and industrial facilities may need to consider many issues under the new rules, including the following:
  • What subcategory is my unit in and what emission standards and monitoring requirements apply?
  • Do I need to retain coal, oil or an alternate fuel fired boiler?
  • Can I control to meet the emission standards? What is the cost?
  • Can I limit my use of a boiler to 10% of capacity?
  • Can I and should I convert to natural gas?
  • Can I qualify as an area source unit?
  • Can I treat my alternate fuel as not a waste under NHSM?
  • Do I want to retain the option of combusting wastes as fuel?
  • What permitting modifications, if any, do I need to make before a compliance date?
  • What recordkeeping and monitoring requirements am I going to have to satisfy? 
Existing units subject to the Boiler MACT are required to achieve compliance by January 31, 2016. Some area source boilers have compliance requirements due by March 21, 2014.  The compliance date for existing units subject to CISWI, while dependent upon the timing of individual state implementation of rules to implement CISWI, cannot  exceed five years.

Working through these issues involves legal, engineering and economic considerations, beginning with a thorough understanding of the rules and how they will apply to an individual unit. With some industry sources estimating that the national cost of compliance may be as high as $10 billion, all owners and operators of units affected by these rules would be well served to pay close attention to the new requirements and available compliance options. 

Section 112 of the CAA, 42 U.S.C. 7412, requires the EPA to create emission standards for hazardous air pollutants (HAPs) in various sectors of the economy, including for new and existing industrial and commercial boilers. Such standards are known as National Emission Standards for Hazardous Air Pollutants (NESHAPs) and are codified within 40 C.F.R. Part 63. Congress has mandated MACT standards for major sources of HAPs. For minor sources of HAPs, also referred to as “area sources,” emission standards are to be established by the EPA through application of generally available control technology (GACT).

However, Congress required the EPA to separately regulate emissions from units that combust solid wastes. Section 129 of the CAA grants distinct authority to the EPA to create emission performance standards for such units. Whether a material, when combusted, is considered a solid waste is determined by reference to the  EPA’s rules published under Resource Conservation and Recovery Act (RCRA), 42 U.S.C. 6901 et seq. Standards published under Section 129 are referred to as the CISWI rules and are codified under 40 C.F.R. Part 60.

More than a decade ago, the EPA initiated development of MACT standards for industrial and commercial boilers (Boiler MACT). However, the agency’s efforts were derailed in 2007 by a court decision vacating the rule because the rulemaking had improperly included under the Boiler MACT rulemaking units which combust solid waste for energy recovery.  In NRDC v EPA, 489 F. 3d 1250 (D.C. Cir. 2007), the court concluded Congress intended any unit combusting non-hazardous solid wastes for any purpose (for energy recovery or waste destruction) be regulated under Section 129 and not Section 112.

Following the court decision, the EPA began a multi-prong rulemaking effort to develop a new Boiler MACT, new CISWI rules to address boilers and process heaters burning waste for energy recovery and new rules under RCRA to define when materials otherwise considered solid wastes would be considered fuels and not wastes when combusted for energy recovery. In 2010, the EPA proposed four new rules: a Major Source Boiler MACT, and Area Source Boiler NESHAP, CISWI rules for units burning waste for energy recovery and a NHSM rule to define under RCRA materials when combusted materials would be considered “fuels” and when they would be considered “wastes.” Against a background of continuing litigation over the timing of the EPA’s rulemaking, the agency published final rules in 2011 only to immediately announce that it would reconsider the rules it had just promulgated. In December, 2011, the EPA proposed revisions to all the rules. EPA’s final rulemaking in December 2012 concluded this reconsideration.  Only the federal courts can determine if this rulemaking saga is now truly over.

Steve Kohl, a partner at Warner Norcross & Judd, focuses his practice in air emission regulation and litigation.  He has spoken and written on Clean Air Act regulation of hazardous air pollutants for the American Bar Association and State Bar of Michigan and currently serves as a member of the Air Toxics Workgroup of the Michigan Department of Environmental Quality.  Steve can be contacted at skohl@wnj.com or 248.784.5141.

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