Court Severely Limits Startup, Shutdown and Malfunction Exclusions Under MACT Standards

March 18, 2009
MGKF News Flash

In Sierra Club v. EPA, (D.C. Cir., No. 02-1134, (12/19/08)), the D.C. Circuit Court of Appeals determined that EPA had overstepped its legal authority in providing expansive relief from hazardous air pollutant ("HAPs") standards for startup, shutdown and malfunction ("SSM") events. The general provisions (Subpart A) of EPA's maximum achievable control technology ("MACT") regulations, promulgated at 40 C.F.R. Part 63, require sources to develop plans for minimizing emissions of hazardous air pollutants during SSM events. To the extent that a facility acts in accordance with its SSM Plan, its reporting obligations under Subpart A are reduced.

In recent years, EPA has expanded the regulatory relief afforded sources in the event of SSM events. In particular, in 2006, EPA ruled that sources need not submit their SSM plans for approval, and need not file semiannual reports of SSM incidents, if the facility acted in accordance with its SSM Plan on each such occasion. Further, EPA stated that emissions in excess of MACT standards occurring during SSM events would not constitute noncompliance, if the facility had responded to the incident in accordance with its SSM plan.

The Court agreed with the environmentalists' challenge that EPA had no authority to grant such relief from MACT standards. In particular, the Court held that the Clean Air Act requires MACT standards to apply at all times, including during startup, shutdown and malfunction events.

It is important to note that the specific regulations before the Court did not include narrowly-tailored provisions providing certain relief from MACT emission standards during SSM activities. In particular, EPA has promulgated certain MACT standards which include specific exceptions from emission limitations during SSM events, including regulations that establish a maximum number of hours in a calendar year during which a facility may implement maintenance activity without complying with the specific MACT emission limit. Although the language of the Court's opinion in Sierra Club raises question about the legitimacy of these specific regulatory allowances, the Court did not reach that issue, and instead merely held that EPA may not provide sweeping relief from MACT standards during any SSM incident for which the facility acted in accordance with an SSM plan (which would never have even been reviewed and approved by an agency under EPA's recent interpretation). The Clean Air Act allows EPA to establish exceptions to MACT requirements based upon technological considerations. Therefore, to the extent that EPA has justified specific, narrowly-tailored SSM provisions within individual MACT standards, and based such exceptions upon technological constraints of compliance, such provisions would not appear to be directly affected by the Court's ruling in Sierra Club.