States Act in Absence of Boiler MACT

On June 8, 2007 the National Emission Standard for Hazardous Air Pollutants for Industrial, Commercial and Institutional Boilers and Process Heaters/Indirect Heat Exchangers (Boiler MACT) was vacated by the U.S. Court of Appeals for the District of Columbia and remanded to EPA.  Under Section 112(j) of the Clean Air Act (known as “the MACT Hammer”), if EPA misses a NESHAP promulgation date, affected sources must submit an air permit to the local regulatory authority within 18 months of the original promulgation deadline for the purposes of determining a case-by-case MACT standard.  Because Section 112(j) does not directly address the scenario of a vacatur, state and local agencies have been unclear on how to proceed.  However, some states have begun to more forward under Section 112(j).

Recently, under pressure from a regional environmental advocacy group, Oregon required submittal of Part 1 applications and subsequently set a deadline for Part 2 applications for September 15, 2009 although it granted extensions until March, 15, 2010 to facilities that submitted Part 1 applications and requested extensions.  Virginia required Part 1 submittals in early 2009 and expects to call for Part 2 submittals upon publication of EPA’s proposed rule.  New Jersey recently published for public comment, a draft presumptive MACT determination intended to “streamline the case-by-case MACT determination process by providing the Department’s interpretation of the application of the MACT standard…”  North Carolina is also in the process of developing a process to meet the requirements under 112(j), based on opinion of the North Carolina Attorney General’s office that “the vacatur has the effect of un-doing the promulgation.”

Meanwhile, EPA has indicated it expects to publish a revised, proposed Boiler MACT standard in April 2010, with finalization expected in December 2010.   Since the vacatur, EPA has collected new and more data from which to derive the top 12 percent needed to set the standard.  A major concern among industry is the possibility that new EPA will consider the best performers on a pollutant-by-pollutant basis, potentially resulting in a standard that no unit can meet. 

Facilities that receive a 112(j) determination will be subject to the terms therein for five years (eight years, considering the 3-year compliance period), regardless of whether EPA issues a final Boiler MACT rule during that time period.  Some facilities may conclude that a state-issued standard is less risky than what EPA will ultimately promulgate and may want to encourage a state to finalize their 112(j) permit prior to December 2010.