IN MAJOR REBUKE TO EPA, STATE FORCES FIRST-TIME BACT REVIEW FOR PM2.5

In a likely far-reaching decision, a Montana appeals board is forcing the state to redo a best available control technology (BACT) analysis for a proposed coal-fired power plant to include first-time reviews of fine particulate matter emissions (PM2.5), sending a strong rebuke to EPA’s long-running argument that BACT analyses can use larger coarse particles (PM10) as a surrogate for PM2.5 -- which critics say results in weaker emission controls.

 

Environmentalists say the April 21 decision has implications similar to the U.S. Court of Appeals for the District of Columbia Circuit’s recent rejection of EPA’s mercury rule for power plants, which has prompted many states to redo permit analyses to assess mercury controls. Activists also say that because the health effects of PM2.5 are more substantial than PM10, the new BACT review in Montana will force far more expensive pollution controls than what is required for coarse particles.

 

One environmentalist says the Montana decision is already reverberating among environmentalist attorneys challenging power plant permits in Georgia and South Dakota.

 

However, EPA says while Montana and other states may require more stringent BACT reviews, the appeals board ruling does not impact EPA’s BACT policy.

 

An EPA spokeswoman adds that a 1997 agency memo that allows using PM10 as a surrogate in the reviews remains the agency’s policy regardless of the ruling. “We would not think that would set a precedent. Our rules are still our rules. States can go stricter but that doesn’t set a precedent for our rules,” the spokeswoman says.

 

Industry sources are taking a wait-and-see attitude toward the scope of the 6-1 ruling by the Montana Board of Environmental Review requiring the Montana Department of Environmental Quality (DEQ) to conduct a new BACT analysis for PM2.5 for the proposed Highwood Generating Station.

 

But a second environmentalist says if Montana ultimately sets stringent PM2.5 requirements at the plant, other states reviewing power plant permits will have to consider adopting the same limit, or explain why they cannot impose the same controls. That is because BACT requires “top-down” reviews of pollution controls mandated at other facilities no matter where in the country they are located.

 

“This raises the bar similar to the D.C. Circuit ruling that kicked in case-by-case” mercury reviews, the source says. “These plants will have to start over and do BACT for PM2.5. This is a big deal.”

 

The Montana Environmental Information Center and other groups appealed the clean air permit that Montana DEQ issued to Southern Montana Gas & Transmission Cooperative last year for the proposed Highwood facility, in part over the BACT analysis’ lack of consideration of PM2.5 emissions. In final arguments submitted to the board in late March, environmentalists wrote, “Having failed to meet their heavy burden to demonstrate that PM2.5 BACT analysis is impossible, [Southern Montana] and DEQ cannot rely on illegal guidance from EPA.” The brief is available on InsideEPA.com.

 

A third environmentalist says EPA’s policy that PM10 can be used as a surrogate in BACT reviews “was at the heart of our case.” The challengers argued that the 1997 EPA memo -- authored by former Office of Air Quality Planning & Standards chief John Seitz -- is flawed because the Clean Air Act requires BACT analyses for any regulated pollutant.

 

EPA created a national ambient air quality standard (NAAQS) for PM2.5 in 1997, regulating it as a separate criteria pollutant from PM10. Then in 2006 the agency strengthened the PM2.5 standard, but has never required BACT reviews to include the pollutant.

 

Environmentalists argue that pollution controls for PM2.5 differ from the controls necessary to reduce PM10 emissions, and say that EPA’s BACT position undercuts the agency’s own arguments -- which it took to the Supreme Court -- for establishing a PM2.5 NAAQS as a separate criteria pollutant.

 

“These are different pollutants and that’s why they are listed separately, and to continue to treat them as the same thing undermines EPA’s argument that they should regulate PM2.5 in the first place,” the second environmentalist says. Because of EPA’s policy “no one is actually controlling PM2.5. And we said that is not appropriate, 11 years later, to say you don’t have to do a specific BACT for this pollutant.”

 

The first source adds, “As long as [EPA is] looking at PM10, they are not required to target PM2.5 specifically and our case was about trying to change that policy. And the state of Montana agreed with us and has become the first to say they will not wait around for EPA anymore.”

 

These sources say that the Montana PM2.5 BACT analysis will be closely watched and that it should require far more stringent controls at the plant, particularly as the health evidence against PM2.5 mounts, because the benefits of controlling PM2.5 will far outweigh the cost of emissions equipment.

 

However, a Southern Montana source says the new BACT analysis “may or may not require new pollution controls. It is conceivable we could end up with the same” that are now required for PM10. The source adds that the environmentalists’ claims about the significance of the ruling “may be overstated.”

 

A second industry source acknowledges that some states may adopt the Montana requirement but others may wait for EPA to finalize its PM2.5 implementation rule under the new source review (NSR) program, which it proposed last fall. While that rule will not change the BACT analyses requirements, it will establish specific PM2.5 thresholds at sources including power plants. The source says it will be difficult to determine what, if any, PM2.5 controls are required under BACT without the final EPA NSR thresholds. And because BACT has not included PM2.5 in the past, the existing models that Montana will have to rely on may not be credible.

 

The EPA spokeswoman says the use of PM10 as a surrogate in BACT reviews is “a temporary fix” until the agency finalizes its PM2.5 NSR rule, expected later this year.

 

Meanwhile, environmentalists say one reason Montana agreed to require the new BACT analysis is because of dissatisfaction with EPA in recent years.

 

“Our argument to Montana was that EPA’s credibility is not at its zenith at the moment,” one activist says. “The decision reflects a turning of the tides with state agencies recognizing that EPA is overreaching, particularly in implementation of NSR and the Clean Air Act, and that EPA guidance isn’t the gold standard [so] states need to take their own responsibility in upholding clean air standards.”

 

Southern Montana had argued to board that it should not be forced to conduct a PM2.5 BACT analysis because “no one has ever done this before” and “nobody should have to go first until EPA says how to do it,” the environmentalist says. “And the fact that we finally have somebody in this country saying they are not waiting for EPA any longer . . . means that argument is no longer valid.”

 

During the Montana board’s debate this week, several sources at the meeting including one of the commissioners say EPA’s waning credibility was a focus on the discussion, including the fact that EPA had pressured Montana to adopt its mercury rule that was later thrown out by the D.C. Circuit.

 

A Montana commissioner says the board was particularly swayed by environmentalists’ arguments that PM2.5 must be treated separately from PM10. “That was really the crux of the message,” the source says. “EPA has said for almost 10 years that we recognize that PM2.5 has serious health consequences . . . [but] hasn’t come up with new guidance despite that.” -- Dawn Reeves

 

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