EnviroNotes

U.S. EPA No Longer Requires Adherance to Startup, Shutdown and Malfunction Plans
Environmental Stewardship Program Will Reward Participating Businesses

By Andy Bowman, Chair, Environmental Law Group, Bingham McHale LLP

On April 20, 2006, U.S. EPA published a final rule amending the startup, shutdown and malfunction (SSM) requirements for sources subject to a National Emission Standard for Hazardous Air Pollutants (NESHAP). 71 Federal Register 20446 (April 20, 2006). These amendments will reduce the reporting and recordkeeping burden for affected sources. The amendments became effective on April 20, 2006.

Sources continue to be obligated to minimize emissions at all times, including during periods of SSM. The final rule provides greater flexibility for owners and operators to minimize emissions during times of SSM. Sources must still prepare a SSM plan; however, U.S. EPA has removed the requirement that a source must follow its SSM plan during times of SSM. This change allows owners and operators the flexibility to deviate from their SSM plan when there is an unanticipated type of malfunction, an emergency not contemplated by the SSM plan, safety considerations or better means to minimize emissions. The amended rule recognizes that in some circumstances it may be more practicable to take steps to minimize emissions that are not included in the SSM plan. Whenever the source takes action inconsistent with the SSM plan during a startup or shutdown that caused an exceedance of an applicable emission limitation or during a malfunction, the source must still report actions inconsistent with the SSM plan as a deviation, but it will no longer be a violation of the SSM requirements.

The final rule also removes the requirement for the U.S. EPA to obtain a copy of a source’s SSM plan whenever a member of the public requests it. Any state or local permitting agency will continue to have the discretion to obtain a plan requested by the public, but there will not be a federal requirement to do so. U.S. EPA also clarified that the SSM plan should not be viewed as a compliance plan under the Clean Air Act or under the Title V permit regulations. SSM plans are not to be incorporated into the source’s Title V permit. Revisions to a SSM plan do not trigger the need for a permit modification.

Amendments have been made to clarify that reporting and recordkeeping is only required when startup or shutdown causes an exceedance of an applicable emission standard and for any occurrence of a malfunction. Such recordkeeping and reporting must include a description of the actions taken during periods of SSM to minimize emissions, the occurrence and duration of the SSM, actions taken which are different from the procedures in the SSM plan and information necessary to demonstrate conformance with the SSM plan. If the actions taken are consistent with the SSM plan, the report may be submitted as a checklist. Sources which fail to follow their SSM plans may face additional scrutiny to determine whether emissions were minimized.

Environmental Stewardship Program Will Reward Participating Businesses

By Matt Gernand, Attorney, Environmental Law Group, Bingham McHale LLP

On June 1, 2006, the Indiana Department of Environmental Management (“IDEM”) published draft rules that would create two voluntary programs designed to provide incentives for Indiana businesses and units of local government to be proactive and go beyond current environmental regulatory requirements. Because these programs will affect air, water, and waste regulations, three separate rules have been drafted to implement the new programs in each of these areas. 29 Ind. Reg. 3109 (June 1, 2006); 29 Ind. Reg. 3124 (June 1, 2006); 29 Ind. Reg. 3142 (June 1, 2006). These two programs will be similar to the National Environmental Performance Track Program (“NEPT”) administered by the United States Environmental Protection Agency (“EPA”). Because there are differences between the NEPT and IDEM’s programs, applicants interested in both programs will need to apply for and be accepted into both programs.

The proposed rules will implement the Environmental Stewardship Program (“ESP”) for businesses and the Comprehensive Local Environmental Action Network (“CLEAN”) for units of local government. In order to be accepted into either of these programs, the applicant must certify that it is currently in compliance with all local, state and federal environmental laws and that it has not been convicted in the past five years for an environmental-related crime. In addition, the IDEM may deny an applicant admission into the program if, among other things, the applicant has three or more significant violations in the past three years; has current unaddressed or unresolved significant violations; or has a history or pattern of noncompliance.

Further, applicants must implement an approved Environmental Management System (“EMS”). The EMS is defined as a “continuous cycle of planning, implementing, reviewing, and improving a set of documented processes and practices used to develop and implement the environmental policy and manage the environmental aspects of an entity to maintain compliance, reduce adverse environmental impacts and increase operational efficiency.” The EMS is required to be a written environmental policy that has the support and approval of senior management of the entity. It must identify and prioritize environmental issues at the facility and provide a plan that ensures continued compliance with environmental regulations and continuous improvement in environmental performance.

Finally, an applicant must identify continuous environmental improvement initiatives it will undertake during its membership in the program. For businesses in the ESP, the applicant must identify one initiative at the time of application and additional initiatives must be identified in the annual summary. For units of local government seeking entry into the CLEAN program, the applicant must identify 5 initiatives to be implemented during the three-year term of membership.

Once accepted into the ESP or CLEAN program, the term of membership is three years. The program participant will be required to file an annual summary detailing the results of its continuous environmental improvement initiatives and a review of its EMS.

To encourage participation in this program, the rules establish incentives for program participants. The incentives vary depending on what types of environmental permits the program participant may have.

For participants with permits issued by IDEM’s Office of Air Quality, the incentives include:

1) Federally Enforceable Operating Permits (“FESOP”) and Minor Source Operating Permits (“MSOP”) will be issued for extended terms of 10 years.

2) Allow for monthly volume-weighted averaging instead of daily averaging of all coatings applied in a coating or printing line subject to the requirements of 326 IAC 8-2 or 326 IAC 8-5-5.

3) Expedited permit process including on-site pre-application and post-application meetings between the participant and the permit writer upon request. An expedited review process by IDEM and EPA. IDEM will provide an expedited renewal process for FESOP and Title V permits. In addition, IDEM will assign the same permit writer for all the participant’s permits.

4) The opportunity to submit quarterly reports on a semi-annual basis.

5) Low routine inspection priority and one-day notice prior to performing a routine inspection.

6) Alternative compliance and monitoring strategies may also be available.
7) Qualified pollution prevention projects may be processed as a minor revision of a MSOP or FESOP.

For participants that have permits issued by IDEM’s Office of Water Quality, the incentives include:

1) The ability to submit Discharge Monitoring Reports (“DMR”) annually instead of monthly.

2) Opportunity for reduced sampling frequency.

3) Expedited NPDES and land application permit renewal process.

4) Assignment of the same permit writer for all of participant’s permits.
5) Low routine inspection priority and one-day notice prior to performing a routine inspection.

For participants that have permits issued by the IDEM’s Office of Land Quality, the incentives include:

1) IDEM will provide ESP/NEPT dual members with status as a Large Quantity Generator of hazardous
waste the opportunity to apply for extended on-site storage times to up to 180 days (and 270 days if the waste is transported 200 miles or more) to accumulate hazardous waste without a RCRA permit or interim status

2) Assignment of the same permit writer for all of participant’s permits

3) Low routine inspection priority for Large Quantity Generators and one-day notice prior to performing a routine inspection.

IDEM will also provide public recognition of ESP members.

The IDEM has announced it will hold a public hearing on these rules on June 20, 2006, at 1 p.m. Comments on the draft rules must be submitted by July 3, 2006. The rules are scheduled to be presented to the appropriate boards for preliminary adoption this fall. For additional information contact: Dan Murray, Assistant Commissioner of the Office of Pollution Prevention and Technical Assistance, 317-232-8172 or Stacey Martindale, ESP Program Manager, 317-234-4053.

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