Overview

On March 29 2010, the US Environmental Protection Agency (EPA) released its final decision confirming that greenhouse gas (GHG) emissions will not trigger federally-mandatory permitting under the Clean Air Act (CAA) until January 2 2011, at the earliest. In the interim, however, EPA recommends that agencies reviewing CAA permit applications promote, where appropriate, the use of Best Available Control Technology (BACT) to indirectly reduce GHG emissions.

The final decision also affirms EPA’s existing policy that a pollutant is not considered “subject to regulation under the permitting programs of the CAA unless that pollutant is subject to an emissions control requirement. While the final decision establishes when EPA will begin regulating GHGs, it does not specify how GHGs will be regulated. The rule on how EPA will regulate GHG emissions from lightduty vehicles (LDV Rule) was released on April 1 2010.

This is EPA’s first rule regulating GHG emissions and is intended to boost fuel efficiency standards for model years 2012 to 2016 new vehicles. By the end of this month, EPA is expected to release another rule on how it will regulate GHG emissions from stationary sources, such as smelters, refineries and power plants.

The proposed stationary source rule, also known as the Tailoring Rule, would limit CAA permitting requirements to industrial sources emitting more than 25,000 tons per year (tpy) of carbon dioxide equivalent pollutants. But a recent public statement by EPA Administrator Jackson indicates that this threshold may increase to 75,000 tpy in the final rule, which would reduce the number of sources required to obtain permits. Companies whose sources could be affected should carefully follow upcoming developments in the Tailoring Rule.

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