Environmental APRIL 2002 MACT Hammer Poised to Strike Many industrial entities may soon be required to submit § 7412(3)(A). MACT standards may require reductions in applications seeking “case-by-case” establishment and a variety of ways, including the use of material substitutions implementation of maximum achievable control technology or enclosed systems, the capture and removal of hazardous (“MACT”) to curtail air emissions. The so-called “MACT air pollutants, or specific equipment design or operator hammer” is scheduled to require applications by sources training requirements. 42 U.S.C. § 7412(d)(2). within several manufacturing categories and subcategories no later than May 15, 2002. Accordingly, it is critical that those who may be affected by the MACT hammer take appropriate action now in preparation to meet the deadline. This Alert is intended to provide a general understanding of the MACT requirements, to publicize the quickly approaching deadline, and to assist in providing an outline for an appropriate course of action. Congress sought to ensure the EPA’s compliance with the Act’s deadline for setting MACT standards by including a provision commonly referred to as the “MACT hammer.” 42 U.S.C. § 7412(j). The MACT hammer provides that where the EPA has not promulgated a MACT standard for a category or subcategory by the deadline, each owner or operator of a major source within that category or subcategory must submit a Title V permit application to the proper Clean Air Act authority (in most cases, the State) by MACT BACKGROUND May 15, 2002. 42 U.S.C. § 7412(j)(3). Before approving In an effort to accelerate the reduction of hazardous air the applications, the EPA or state authorities are to establish pollutants emissions (“HAPs”), Congress issued several MACT standards on an individual, or “case-by-case” basis. directives to the EPA in its enactment of the Clean Air Act 42 U.S.C. § 7412(j)(5). Sources with existing Title V Amendments of 1990. Pub. L. 101-549 (Nov. 15, 1990) permits will be required to apply for an amendment to (the “Act”). For example, the EPA is required to publish incorporate case-by-case MACT standards, while those and regularly amend a list of source categories and operating under a Title V application must submit an subcategories of all major and area sources of HAPs. 42 amended application requesting a case-by-case MACT U.S.C. § 7412(c)(1). The EPA is further required to determination. Accordingly, the MACT hammer represents establish national emissions standards for HAPs in each a formidable task for both major sources and Clean Air Act category and subcategory, to be achieved through the authorities. implementation of MACT at all major HAP sources. 42 U.S.C. § 7412(d). These directives were to be achieved for all categories and subcategories no later than November 15, 2000. 42 U.S.C. § 7412(e)(1)(E). SOURCE CATEGORIES AND SUBCATEGORIES To date, the EPA has identified over 100 HAP source categories and subcategories, but has established final For new sources, MACT requires the achievement of the MACT standards for only a fraction of these. As recently as maximum degree of emissions reductions that has been January 2002, the EPA recognized that approximately 60 achieved in practice by the best-controlled similar source. source categories and subcategories are likely to be affected 42 U.S.C. § 7412(d)(3). For identified existing sources, the by the MACT hammer. Moreover, the status of the EPA’s emissions standards may be less stringent than those promulgation efforts is very liquid and subject to change on required of new sources, but must not be less stringent than a daily basis. With that in mind, below is a survey of the the average achieved by the best performing twelve percent status of the identified source categories and subcategories of existing sources within each source category. 42 U.S.C. as of March 14, 2002. Kirkpatrick & Lockhart LLP MACT PROPOSED – NOT FINAL ASPHALT ROOFING & PROCESSING Asphalt Roofing Asphalt Processing CELLULOSE PRODUCTION MFG. Carboxymethylcellulose Production Cellulose Ethers Production Cellulose Food Casing Manufacturing Cellophane Production Methylcellulose Production Rayon Production COKE OVENS: PUSHING, QUENCHING & BATTERY STACKS FLEXIBLE POLYURETHANE FOAM FABRICATION OPERATION FRICTION PRODUCTS MANUFACTURING GENERIC MACT: Carbon Black Production Cyanide Chemicals Manufacturing Ethylene Processes Spandex Production HYDROCHLORIC ACID PRODUCTION INDUSTRY/FUMED SILICA PRODUCTION INTEGRATED IRON & STEEL LARGE APPLIANCE (surface coating) METAL COIL (surface coating) INDUSTRY MUNICIPAL SOLID WASTE LANDFILLS PAPER & OTHER WEB COATING (surface coating) PETROLEUM REFINERIES - Catalytic Cracking, Catalytic Reforming & Sulfur Plant Units POLYVINYL CHLORIDE & COPOLYMERS PRODUCTION PRIMARY COPPER REINFORCED PLASTIC COMPOSITES PRODUCTION ENGINE TEST FACILITIES (Combined with the Rocket Testing Facilities rule) FABRIC PRINTING, COATING, & DYEING INDUSTRIAL, COMMERCIAL AND INSTITUTIONAL BOILERS & PROCESS HEATERS IRON FOUNDRIES LIGHTWEIGHT AGGREGATE (to be delisted) LIME MANUFACTURING MERCURY CELL CHLOR-ALKALI PLANTS (formerly Chlorine Production) METAL CAN (surface coating) METAL FURNITURE (surface coating) MISCELLANEOUS METAL PARTS & PRODUCTS (surface coating) Asphalt/Coal Tar Application to Metal Pipes MISCELLANEOUS ORGANIC CHEMICAL PRODUCTION & PROCESSES Alkyd Resins Production Ammonium Sulfate Production Benzyltrimethylammonium Chloride Production Carbonyl Sulfide Production Chelating Agents Production Chlorinated Paraffins Production Ethyllidene Norbomene Production Explosives Production Hydrazine Production Maleic Anhydride Copolymers Production Manufacture of Paints, Coatings, & Adhesives OBPA/1,3-diisocyanate Production Photographic Chemicals Production Phthalate Plasticizers Production Polyester Resins Production ORGANIC LIQUIDS DISTRIBUTION (non-gasoline) PAINT STRIPPING OPERATIONS TIRE MANUFACTURING PLASTIC PARTS (surface coating) WET FORMED FIBERGLASS MAT PRODUCTION PLYWOOD and COMPOSITE WOOD PRODUCTS (formerly Plywood and Particle Board Manufacturing) MACT NOT YET PROPOSED ASPHALT/COAL TAR APPLICATION METAL PIPES PRIMARY MAGNESIUM REFINING RECIP. INTERNAL COMBUSTION ENGINES (NESHAP/NSPS) AUTO & LIGHT DUTY TRUCK MFG. (surface coating) REFRACTORY PRODUCTS MANUFACTURING (formerly Chromium Refractories) BRICK, STRUCTURAL CLAY PRODUCTS & CLAY CERAMICS MANUFACTURING SEMICONDUCTOR PRODUCTION CLAY MINERALS PROCESSING (To be addressed in the Brick, Structural Clay Products, and Clay Ceramics Manufacturing rule) COMBUSTION TURBINE (formerly Stationary Turbines) SEWAGE SLUDGE INCINERATORS (to be delisted) SITE REMEDIATION TACONITE IRON ORE PROCESSING WOOD BUILDING PRODUCTS (surface coating) (formerly Flat Wood Paneling) Source: Office of Air Quality Planning and Standards, United States EPA, available at http://www.epa.gov/ttn/atw/eparules.html 2 KIRKPATRICK & LOCKHART LLP ENVIRONMENTAL ALERT DETERMINING APPLICABILITY OF MACT STANDARDS Does the source currently hold a Title V permit, or does it have a pending Title V application? If so, the The EPA acknowledges that it will not have final MACT source will not necessarily be required to submit a new standards in place for all source categories and Title V application. However, it is required to submit a subcategories by the May 15, 2002 deadline. The EPA has request for permit amendment or an amended signed a final rule directing source categories affected by application by the MACT hammer deadline if it meets the MACT hammer to submit basic information to the each of the above criteria. Clean Air Act authority by the May 15, 2002 deadline, to be followed by a more detailed supplemental application “It is important to recognize that the MACT hammer within 24 months. The EPA refers to these two sequential applies to source categories and subcategories with no submissions as Parts 1 and 2 of the application, final MACT standards - where a MACT standard has been respectively. See “National Emission Standards for proposed, it should not be assumed that the standard will Hazardous Air Pollutants for Source Categories: General be final before the May 15, 2002 deadline.” Accordingly, Provisions; and Requirements for Control Technology potentially affected sources that have not already done so Determinations for Major Sources in Accordance with should undertake an applicability analysis as soon as Clean Air Act Sections, Sections 112(g) and 112(j),” possible in preparation for the looming deadline. The available at http://www.epa.gov/ttn/oarpg/t3pfpr.html MACT hammer is in motion and closing in fast. (“Final Rule”). While the Final Rule mitigates the immediacy of the MACT hammer to some extent, as discussed below, potentially affected sources should begin assessing now whether a Title V submittal will be required. WHAT HAPPENS NEXT: AN APPROPRIATE COURSE OF ACTION WHEN THE MACT HAMMER IS POTENTIALLY APPLICABLE As noted above, the Final Rule has somewhat softened the blow of the MACT hammer by dividing the application To determine whether the MACT hammer will require a process into two parts – Part 1 and Part 2. Sources submittal by May 15, 2002, owners and operators should affected by the MACT hammer must submit Part 1 of the consider each of the following: MACT application to the CAA authority (in most cases, Does the facility emit HAPs? Section 112(b) of the Clean Air Act provides a list of HAPs, which has been supplemented by the EPA in subsequent regulations. 42 U.S.C. § 7412(b); 40 C.F.R. § 61.01(a). Is the facility a major source of HAPs? A facility is a major source of HAPs if it has the potential to emit 10 the State) by the May 15, 2002 deadline. The EPA has indicated that failure to submit a timely Part 1 application may lead to an enforcement action. A Part 1 application must contain the following information: the name and physical address of the source; a brief description of the major source and an tons per year of any HAP, or 25 tons per year of all identification of the relevant source category; HAPs combined. 42 U.S.C. § 7412(a)(1). Does the facility fall within a source category or belonging to the relevant source category; and subcategory with no final MACT standard? The EPA has stated its belief taht owners and operators should an identification of the types of emission points an identification of any affected sources within a facility for which a MACT determination has already be able to reasonably determine whether a source is been made. within a category or subcategory with no final MACT standard by referring to the proposed rules that have Part 2 of the MACT application is due no later than 24 been published or, for a category or subcategory for months after submission of Part 1, and must contain the which no rule has yet been proposed, by referring to following information: the EPA’s Air Toxics Website. This, however, may not for new sources, the anticipated day date of startup; identification of the HAPs emitted by each affected be as clearcut as the EPA suggests. An owner or operator who is unsure about MACT applicability may submit a Part 1 MACT application asking for an source in the relevant source category and an estimated applicability determination by the permitting authority. total controlled and uncontrolled emission rate for each HAP; MARCH 2002 Kirkpatrick & Lockhart LLP any existing Federal, State, or local limitations or an individual MACT determination. Instead, it must only requirements applicable to the affected source; comply with the relevant final standards by the deadline set identification of control technology in place for each affected emission point; forth therein. As noted above, the status of the rules relating to many of the identified source categories are in a state of flux. The EPA has indicated that while it will miss any information relevant to establishing a MACT floor, the May 15, 2002 deadline for a number of source and at the option of the source owner or operator, a categories, it is hopeful that it will have final rules in place recommended MACT floor; and for several others. Furthermore, of the source categories any other information reasonably needed at the with no final rule by the deadline and therefore requiring a discretion of the permitting authority. Part 1 application, several may have final rules in place before a Part 2 application is due, and others after Upon receipt of the Part 2 application, the CAA authority submission of a Part 2 application, but before an individual is responsible for determining the appropriate MACT determination is due from the permitting authority. Thus, standard for each individual source, unless the EPA has frequent monitoring of the status of the relevant MACT finalized a MACT standard for the relevant source rule may allow a source to avoid time and expense category in the interim. involved in unnecessary preparation of any or all of a While the responsibility for determining a MACT standard MACT application. lies with the CAA authority, an owner or operator of an ARNNIE DODDERER affected source has an opportunity to influence the 412.355.8255 adodderer@kl.com individual determination by submitting the following optional information in the Part 2 application: KENNETH S. KOMOROSKI recommended emission limitations for the affected 412.355.6556 kkomoroski@kl.com source, together with support information, or recommended design, equipment, work practice, or BARR Y M. HAR TMAN BARRY HARTMAN operational standard, or a combination thereof, as an 202.778.9338 bhartman@kl.com emission limitation; a description of the control technologies the source intends to apply to meet an emission limitation FOR FURTHER INFORMATION about criminal enforcement of including technical information on the design, environmental laws or Kirkpatrick & Lockhart’s environmental practice, please consult the author or one of the Kirkpatrick & Lockhart LLP office contacts listed below. You may also visit our webpage at www.kl.com. operation, size, estimated control efficiency, and identification of the affected sources to which the control technologies will apply; and a recommended monitoring program to demonstrate continuous compliance any MACT emissions limitations. Throughout the MACT application process, a source should remain aware of the ongoing status of the MACT Roger C. Zehntner Stephen A. Kennedy R. Timothy Weston Paul W. Sweeney, Jr. Daniel A. Casey Anthony P. La Rocco Warren H. Colodner Kenneth S. Komoroski Richard W. Hosking Edward P. Sangster Barry M. Hartman Boston Dallas Harrisburg Los Angeles Miami Newark New York Pittsburgh Pittsburgh San Francisco Washington 617.261.3149 214.939.4917 717.231.4504 310.552.5055 305.539.3324 973.848.4014 212.536.3912 412.355.6556 412.355.8612 415.249.1028 202.778.9338 rzehntner@kl.com skennedy@kl.com tweston@kl.com psweeney@kl.com dcasey@kl.com alarocco@kl.com wcolodner@kl.com kkomoroski@kl.com rhosking@kl.com esangster@kl.com bhartman@kl.com rules for its relevant source category, as its appropriate course of action is subject to sudden change. Once a final rule is in place, an affected source is not required to seek ® Kirkpatrick & Lockhart LLP Challenge us. BOSTON ■ DALLAS ■ HARRISBURG ■ LOS ANGELES ■ MIAMI ■ NEWARK ■ NEW YORK ■ PITTSBURGH ■ SAN FRANCISCO ■ ® WASHINGTON ......................................................................................................................................................... 4 This publication/newsletter is for informational purposes and does not contain or convey legal advice. The information herein should not be used or relied upon in regard to any particular facts or circumstances without first consulting with a lawyer. KIRKPATRICK & LOCKHART LLP ENVIRONMENTAL ALERT © 2002 KIRKPATRICK & LOCKHART LLP. ALL RIGHTS RESERVED.