Green House Gas Emissions Will Not Trigger Air Permits for Most Commercial Facilities

With adoption of the Green House Gas (GHG) Tailoring Rule on May 13, 2010, EPA limited the permitting burdens that would have resulted from its recent decision to limit GHG emissions from cars and light trucks. Under the Clean Air Act, once EPA decides to regulate a pollutant, the permitting requirements under the Prevention of Significant Deterioration (PSD) and Title V permit programs kick in for any facility that emits either 100 or 250 tons per year of the regulated pollutant. If those limits had applied to GHG emissions, more than six million sources would have been required to obtain permits, many for the first time.

Instead, EPA adopted a phase-in approach that will require permits from only the largest GHG emissions sources first. In the first phase (January 2, 2011 – June 30, 2011), only sources already subject to PSD permit requirements which construct new or modified GHG emissions sources of 75,000 tpy or more will be subject to the permitting requirements for their GHG emissions under PSD. Similarly, in the initial phase, no Title V permit will be required based solely on GHG emissions. Rather, a facility must already be a major source Title V permit holder for a pollutant other than GHG before it will be subject to the GHG permit requirements.

During the Second Phase of the GHG Tailoring regulation (July 1, 2011 – June 30, 2013), PSD permitting requirements will expand to new construction projects that emit 100,000 tpy of GHG, even if they do not trigger permit thresholds for any other pollutant. Modifications at facilities that increase GHG emissions by 75,000 tpy will similarly be subject to permitting requirements. And for the first time, Title V operating permits will be triggered if a facility emits at least 100,000 tpy CO2e, even if the facility has no other emissions that trigger Title V permit requirements.

EPA has committed to undertake another rulemaking in 2011 and to conclude that rulemaking by July 1, 2012. EPA will seek comment on whether additional phases of GHG permitting are necessary and whether smaller sources should be permanently excluded from permitting requirements. The threshold of GHG emissions which might be subject to permitting requirements in Phase 3 will not be less than 50,000 tpy. Smaller sources will not be required to obtain permits until at least April 30, 2016, even if the decision is made to implement permit requirements for smaller sources after the rulemaking is concluded in 2012.

Without this tailoring rule, EPA estimated that six million sources would need air permits and that 78 percent of GHG emissions from stationary sources would thus be regulated by permit requirements at a cost of $21 billion. With the Tailoring Rule, EPA estimates that 15,500 sources will need air permits, but that 15,000 of those sources already have an air permit. Even with the Tailoring Rule, EPA believes that 67 percent of GHG emissions from stationary sources are regulated at a cost of $69 million.

• What are GHGs ?
  • GHGs are the six gases that have heat trapping properties. Those gases are carbon dioxide, methane, nitrous oxide, hydrofluorocarbons, perflurocarbons and sulfur hexafluoride.
• Why are GHGs regulated?
  • The heat trapping properties of GHGs are believed to contribute to global warming.
• What is a CO2e designation?
  • Because the heat trapping capabilities of the six gases varies, there is an internationally accepted method of converting each GHG into an equivalent CO2 effect which is designated as the CO2e.