EPA Delays Greenhouse Gas Permits for Manufacturing Plants

On April 2, 2010, EPA published a notice delaying the date when PSD and Title V regulations will apply to greenhouse gases ("GHGs") until after January 2, 2011. 1 Originally, the requirements were thought to take effect on the date EPA finalized the GHG emissions standards for vehicles. The April 2 final rule therefore both clarified and delayed the applicability of PSD and Title V permitting programs to GHGs. Questions about the PSD and Title V permitting programs arose as EPA made plans to promulgate regulations for GHG emissions from motor vehicles under Title II of the Clean Air Act in the near future. The April notice marks the culmination of a series of events beginning in 2007 but faces challenges.

In 2007, the U.S. Supreme Court held that GHGs fell within the definition of air pollutants under the Clean Air Act ("CAA"). The Court required EPA to determine whether GHG emissions from new motor vehicles cause or contribute to air pollution that may reasonably be anticipated to endanger public health or welfare, or whether the science is too uncertain to make such a finding. Massachusetts v. EPA, 549 U.S. 497 (2007). On November 13, 2008, EPA Region 8 issued a PSD construction permit that did not include best available control technology ("BACT") limits for carbon dioxide, a GHG. Recognizing Massachusetts, the Region concluded the court decision alone did not mandate PSD permits to include limits on carbon dioxide emissions. However, the Environmental Appeals Board remanded the permit to the Region with instructions to reconsider whether carbon dioxide was subject to BACT based on EPA's interpretation of the CAA's definition of which pollutants are "subject to regulation."

Thus, on December 18, 2008, the then-Administrator of the EPA issued a memorandum ("Johnson Memo") interpreting which pollutants were "subject to regulation" for the purposes of the federal PSD program. According to the Johnson Memo, pollutants "subject to regulation" were either subject to a CAA provision or subject to a regulation that required actual control of the emissions from the specific pollutant and was adopted by EPA under the CAA. Pollutants for which EPA regulations required mere monitoring or reporting were not considered "subject to regulation." In response to criticism of EPA's interpretation of the phrase "subject to regulation," EPA agreed to reconsider the Johnson Memo.

After issuance of the Johnson Memo, EPA determined that GHGs endanger the public...