On January 25, 2018, the U.S. EPA reversed its longstanding Clean Air Act “once in, always in” policy, opening the door for certain “major” sources of hazardous air pollution to finally downgrade to “area” sources. “Reclassification of Major Sources as Area Sources Under Section 112 of the Clean Air Act,” William L. Wehrun, Assistance Administrator, U.S. Environmental Protection Agency (Jan. 18, 2018). The Clean Air Act defines a “major source” as one that emits, or has the potential to emit 10 tons per year of any hazardous air pollutant, or 25 tons per year or more of any combination of hazardous air pollutants.  42 U.S.C. § 7412(a)(1). Sources with lesser emissions are “area sources.” 42 U.S.C. § 7412(a)(2).

The EPA’s “once in, always in” policy was created under Section 112 of the Clean Air Act in a 1995 memorandum authored by then-director of EPA’s Office of Air Quality Planning and Standards. Under this old policy, “major sources” of hazardous air pollutants were “always in” and could not be reclassified to an “area source” even if they subsequently reduced their potential to emit. See “Potential to Emit for MACT Standards – Guidance on Timing Issues.” John Seitz, Director, Office of Air Quality Planning and Standards, U.S. Environmental Protection Agency (May 16, 1995). This meant facilities classified as major sources were always subject to Maximum Achievable Control Technology (“MACT”) standards, regardless of whether they implemented new technology or processes that reduced the facility’s emissions of hazardous air pollutants. The only “out” from this policy was available where a facility permanently eliminated any potential to emit the hazardous air pollutants that had originally triggered MACT and Title V applicability.

The once in, always in policy effectively created a time-dependency on a facility’s MACT applicability where such a temporal limitation did not exist in the statute or implementing regulations. From a regulated facility’s perspective, there was little incentive for a major source to reduce emissions below the major source thresholds after its first substantive compliance date of a MACT standard because there were no benefits to be gained in terms of reduced monitoring, recordkeeping, and reporting, or opportunity to get out of major source requirements. According to EPA, the new policy is more consistent with the plain language of the Clean Air Act and will incentivize facilities to implement technologies that decrease emissions. The new policy will allow facilities previously classified as major sources to be reclassified to area sources by amending their air quality permit to include the limiting conditions. Downgrading to area source status can relieve a company of all or a significant portion of the regulatory burden. By re-classifying, most of these sources will avoid being subject to major source MACT and other applicable major source requirements, including hazardous air pollutant material content standards, control efficiency standards, testing requirements, reporting, record keeping and monitoring requirements, and in some cases, Title V permitting.

If you believe that your facility may be impacted by this policy change and would like to assess your options, please contact Phillip Hoover.